Monday morning I received an email from a past client who asked me, “When’s the best time to sell a Lakefront in Big Bear”? My initial response was Summer. The weather is great, the water level is usually at it’s highest point after the winter snow melt, and it seems like the recreational focus shifts from the ski slopes over to the lake. I wasn’t sure if my answer was convincing enough (for either of us) so I thought it would be a good opportunity to do some research and share it with everyone. So here you go, Jim.
I looked at 4 key factors in determining when to put your home on the market:
1. Let’s take a look at when lakefront homes have sold in the past. I’ve broken down sales per month over the past 6 years below. It’s important to note that these are closed sales. Most buyers and sellers have been in escrow for 30-60 days prior to this so the activity was really 1-2 months prior to the recording date.
Looking at the numbers above I get the following information: January averaged 1.83 sales. February averaged 1.33 sales. March averaged 2.0 sales. April averaged 2.67 sales. May averaged 2.33 sales. June averaged 1.17 sales. July averaged 2.33 sales. August averaged 2.67 sales. September averaged 2.5 sales. October averaged 2.83 sales. November averaged 2.6 sales. And December averaged 2.4 sales. I think you would agree that the first quarter of each year seems to be slightly weaker than the rest of the year……probably because of the weather. But the numbers aren’t THAT far off. If homes are priced right, they seem to sell in all seasons of the year.
2. Next, I would recommend that you look at the lake level. Over the past 6 years, the lake has been down over 17.47 feet at the dam (on October 18, 2004) and it’s been as high as .34 inches from being full (on May 15, 2006). For more information on lake levels read this post, or click here to see how lake levels impact property values. The photos below were taken from the backyard of the same home and visually prove my point.
View from backyard of 39200 Seminole in 2004
View from backyard of 39200 Seminole in 2006
3. Interest rates are another key factor to take a look at. Now…. I understand that some buyers in the $1M to $4M price range for a second home aren’t affected by this as much (they pay cash, they may have a better credit rating, etc), but it does affect the affordability for everyone in general. Below is a graph completed by homefinders.com which shows where interest rates have been over the past 25 years on a conventional 30 year fixed rate. Some lenders are speculating that rates will go above 7% next year if more people put money in their pocket instead of investing in long term bonds. It will be interesting to see. If a buyer is in the jumbo loan market, things will change dramatically! Rates for jumbo loans right now are lousy which impacts loans over the $417,000 mark and home sales in the upper end.
4. I saved the most important factor for last. Supply and Demand….the true measure of when to sell your home. How does your home compare to the competition and how many homes are on the market? A great tool in determining how your home compares to others is to put yourself in a buyers eye. Physically view the competition. Walk through each home as if you wanted to buy in the area and see the positives and negatives of each property. Are they clean? Is the water deeper near one home or another? Are they offering it furnished? Does it have rental history? How’s the view? The access? And how does this compare to yours? Currently there are 39 lakefront homes for sale in Big Bear. That seems high, considering only 13 have sold so far this year. Most of these properties have been sitting on the market all year. They’ve been rejected for one reason or another (price, location, size, etc) and probably won’t sell unless they lower their price.
If I can answer any questions or if you would like to know what the value of your home is in todays market feel free to email me at mikewochner@gmail.com
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