Lakefront at 651 Cove Drive Goes into Escrow

Lakefront Home Goes Into Escrow: 651 Cove Drive, Big Bear Lake, CA 92315

I’m a little surprised this lakefront home took as long as it did to sell. For one, it’s “bank owned” and when buyers hear those two words they automatically think value. And unlike most bank owned properties, this one is clean and updated. It’s located over in the Papoose Bay area near the point on Cove Drive.  Properties on Cove Drive tend to be a little higher in price due to the depth of the water. In 2011, a lakefront home two doors down from this sold for $1,900,000.

History on this Lakefront Home in Big Bear

Originally built by John Vos in 1988, this custom deep water lakefront has breathtaking views from every level.  Completely remodeled by “Interiors” (a local furnishings company) back in 2006.  Large open living room with vaulted beam ceilings, granite slab counter top in the kitchen, distressed wood flooring, and approximately 3110 square feet with 3 bedrooms, 2.5 baths, and a large bonus room downstairs.

The only thing I would have personally done in terms of upgrading the home is to update the kitchen appliances and the bathrooms. But that’s just my opinion. Everything is operational and in excellent shape. All one really needs to do is buy furniture and move in.  Another feature I like is the “wet room” … there’s a walkway along the south side of the house so you can come off the lake, hang up your wet-suit, bring in your inner tube, ski’s, etc before you walk into the house.  It even has an additional washer/dryer hookup so you don’t have to haul in wet clothes.  Great concept IMO for lakefront living.

Pricing Information on this Lakefront Home

This lakefront home sold back in March of 2007 for $1,800,000 furnished.  The previous owner went through a long, drawn-out process of trying to short sell the property.  They started at $1,950,000, dropped the price several times ending up at $1,399,000, had several offers that were submitted to the bank, but the bank ended up taking the property back.  The current list price is $1,250,000 which drew multiple offers. Check back to get sales information in March.

Click here to view the CC&R’s (covenants, conditions, and restrictions) for this lakefront home.

Photos taken when previous lakefront homeowner owned the property.
Furnishings have been removed.

Lakefront view from hot tub

Entrance to this Lakefront Home

Lakefront living room

Lakefront Kitchen

Lakefront dining area

Lakefront Master Bedroom

Lakefront secondary bedroom

If you’re in the market for a lakefront home, feel free to contact me. I’m here to help and know the area very well.

128 Round Drive

The lakefront market in Big Bear seems to be chugging along as sale after sale gives consumers more confidence on the higher end.  There are currently 6 lakefront homes in escrow (not too shabby given the fact that only 16 lakefront homes sold in 2011).  3 of the 6 pending sales carried over from 2011, but we’ve had 3 new ones this year so we’re off to a great start!

128 Round Drive, listed by Tyler Wood of Coldwell Banker, went into escrow yesterday.  This was a deep water lakefront that was on the market for 193 days.  Built in 1987, it had 4 bedrooms, 4 baths, 3075 square feet and it came with a boat.  Round Drive is one of the more exclusive streets along the lake in Big Bear.  It’s centrally located (you can take the back roads and escape some of the traffic), you’re close to the ski slopes, village, and restaurants, and the water is deep.  The only knock I’ve heard against this property is the fact that the master bedroom is upstairs…so I’ve had a couple clients that didn’t like the floor plan, other than that, I like the location, I like the depth of the water, and the back yard.  The seller reduced the price twice before getting an accepted offer.  They started at $1,300,000, reduced to $1,200,000 after 3 months, and reduced again 3 months later to $1,175,000.

Stay tuned for closing details.  Below are photos of the inside in case you skipped over this one.

Saw this in the Grizzly this week……
State Considers Cuts To Boating Department
written by Kathy Portie

One week after California Governor Jerry Brown released his 2013 budget proposal, the Marina Recreation Association sounded the alarm.

Brown proposes to merge or eliminate several state departments as part of his cost-cutting measures. The California Department of Boating and Waterways is on the chopping block. The plan is to merge the department with the state’s Department of Parks and Recreation. The Marina Recreation Association asked its members to contact legislators and oppose the proposal.

Local members of the Marina Recreation Association include Big Bear Marina LLC in Big Bear Lake and Captain John’s Fawn Harbor & Marina in Fawnskin. Association members include marina owners in Arizona, California, Nevada, Utah, Oregon, Idaho, Montana, Washington, Hawaii, Mexico, Canada and Australia.

What does the elimination of the state department mean to the Big Bear Municipal Water District and Big Bear Lake marinas? Big Bear Marina owner Alan Sharp is concerned the money collected in boating licenses and other lake fees will no longer go toward lake and waterway improvement programs.

“The reality of it is the money would go to Parks and Rec,” Sharp said. “The Department of Boating and Waterways revenue comes out of boat registration. That money is earmarked to improve lakes and launch ramps. Put that into the Department of Parks and Rec, that money could be put somewhere else.”

The proposal also sends a red flag to the Big Bear Municipal Water District, which depends on funding from the state agency for its fleet of vessels and employee training. Lake Manager Mike Stephenson is cautious when criticizing the proposal. “I don’t understand the proposal well enough to know how it will affect us,” Stephenson said. “But I don’t want to see them go away. It could have a lot of effect, mainly on the reimbursable training program and officer training program.”
The Marina Association’s statistics show that recreational boating contributes about $16.5 billion to the gross state product, representing 1.2 percent of the state’s economy. It generates about $1.6 billion in state and local taxes. Loans through the Department of Boating and Waterways generate approximately $20 million in revenue each year for the state.

The California Department of Boating and Waterways is self funded by vessel registration fees, boating fuel tax dollars and boating facility construction loan payments. Department programs include officer training, financial aid and equipment grants for more than 100 local and state agencies including boating law enforcement training, marina and launch ramp construction loans and grants, vessel sewage pumpout station grants and abandoned vessel removal assistance.
Stephenson said every boat in the MWD fleet has been paid for through Department of Boating and Waterways grants. “For us, the vessel grant program is important,” Stephenson said. “It helps pay for new engines, drives and boats. And if we lose the education program for our guys, I don’t know where we’d find a replacement.”

The Big Bear Municipal Water District has not taken a stand for or against Brown’s budget proposal. How the money from boater fees is used under the merger will be the determining factor, Stephenson said. “That’s one of the questions that I have,” he said. “If that is eliminated, I’d be extremely opposed (Brown’s proposal). But I don’t see how the government could allocate the money to something else.”
The precursor to the California Department of Boating and Waterways is the Division of Small Craft Harbors, which functioned within the Department of Natural Resources until 1961. At that time, the division was relocated to the Department of Parks and Recreation.

The division was elevated to the Department of Harbors and Watercraft in 1966. The name was changed to the Department of Navigation and Ocean Development in 1969 and to the Department of Boating and Waterways in 1979.
This is not the first time a California governor has proposed eliminating the department. “The issue comes up with every administration,” Sharp said. “We’ve been fighting this for 13 years.”

180 N Eagle Drive

This is a nice, higher-end sale for Gilligan Log Homes.  Built in 2011, this log style deepwater lakefront home covered 4553 square feet and was listed for $2,399,999.  Huge logs throughout, hardwood floors, marble, slate, granite and a wine room….Ummmmm .  A true mountain home.  Stay tuned for closing details….I would hope for Gilligan’s sake that there’s no loan or appraisal….there haven’t been many sales in the $2M+ range over the past year.   If it’s a cash sale, I anticipate a 30 day or sooner type sale otherwise it might be a little tricky getting this one closed.

This is a good sale.  It gives buyers and sellers confidence in the upper end range.

Who Gets the Vacation Home?
Is there a way to hand off a vacation home to the next generation so that everyone still wants to spend time together there?

Tensions often mount when a family figures out what to do with a property that could be a lightning rod for sibling rivalries—not to mention a sizable chunk of an estate.

Creating a new generation of family vacationers is the exception, not the rule, and it requires thoughtful planning.

Tryfan Evans, director of investments at Tufts University, is researching the issue for his family’s property near Stowe, Vt., which has a stocked pond and cross-country ski trails and which the children of the original owners recently inherited.

Mr. Evans, one of the grandchildren of the original owners, is evaluating the costs and benefits of setting up a limited liability company, or LLC, trust or other structure to accommodate intrafamily transfers and provide a framework for sharing expenses.

He is on the right track, experts say. One big friction point in such an arrangement is how to pay the costs involved in maintaining a home—including taxes, insurance, utility bills—after the previous owner dies, says Mary Schmidt, an estate-planning attorney in Boston.

Other factors to consider: How the family gets along, where they live, what happens when the children who inherit a home get married and who is going to use the property, says Linda Hirschson, a shareholder at law firm Greenberg Traurig in New York.

Distance and lack of money are the big reasons a family member might want out—and lead to a house being sold.

Ms. Schmidt recently advised a client who wants to leave a $10 million vacation home to her family to do so in a trust, and to fund the trust with life insurance. That way, a professional trustee can manage the property, and the insurance proceeds can cover expenses. And, if one of the heirs wants to sell, the money in the trust can be used to buy him or her out, she says.

What if you need additional money to replace the roof? “The house has to be rented,” Ms. Schmidt says. “If I’m the trustee, I say, ‘Because we do not have the necessary funds, it will be rented in August.’”

Two types of trusts to consider are a dynasty trust and a “qualified personal residence trust,” or QPRT. Either could help families take advantage of a temporary increase in the gift-tax exemption to $5.12 million from $1 million for individuals and to $10.24 million from $2 million for couples.

In the case of an unusual property that a family hopes to preserve for generations, rather than losing “a rare gem you could never recreate as a family,” a “dynasty” trust might make the most sense, says Martin Shenkman, an estate-planning lawyer in Paramus, N.J. Such a trust “could go on forever.” And once you’ve made the gift to the trust, he says, it’s no longer subject to estate taxes.

In most cases, he says, the property should be held in an LLC owned by the trust, with the trust typically set up in one of four states that allow them: Alaska, Delaware, Nevada or South Dakota.

A QPRT lets a homeowner give a residence to the trust while still allowing him to use it for a set number of years before transferring ownership to heirs at a discount to the current market value. “If you’re looking for a more tax-efficient way to divvy this thing up, the QPRT may be the way to go,” says Blanche Lark Christerson, managing director at Deutsche Bank Private Wealth Management in New York.

Also keep in mind whether the heirs would be subject to state estate tax, which may have a lower threshold than federal estate tax, she says. If the state where the property is located has a low asset threshold for state estate tax, and you live in a different state, having the property held in an LLC with more than one member could help shield you from that tax, Ms. Christerson says.

If estate tax isn’t an issue, and the family’s adult children get along well, forming an LLC, setting up a maintenance fund and creating an operating agreement that covers rights of use and property management could be enough. Ms. Hirschson worked with a family in which the kids lived “all over” but successfully shared and managed a ski-resort getaway this way, she says.

But if the potential heirs don’t seem likely to see eye to eye, or some live far away, consider letting those who aren’t interested sell their share to the others—possibly using other assets from the estate to do so, Ms. Hirschson says.

She worked with a set of parents who wanted to leave a New Hampshire farm to three children, one of whom lived in New York and two who lived in other parts of the country. Ms. Hirschson arranged for bidding by the children, with then money to buy the home coming out of their share of the estate after other bequests.

Even if one generation of siblings successfully shares the beach house, keep in mind that it isn’t likely their progeny would do the same. Unless family gatherings and traditions associated with a place remain strong, they probably won’t have the same attachment to it. So when you are setting up a trust or other structure to hold or manage a property, consider building in an exit strategy.

For example, Ms. Schmidt says, if a house is held in a trust, you might want to build in the option, after several decades, to have it sell the property and distribute the proceeds to the living heirs.

In terms of closings, we only had 16 lakefront sales in 2011, which is low compared to previous years…….comparable to 2008 levels.

Avg List Price for a Lakefront Home in Big Bear in 2011: $1,101,768

Avg Sales Price for a Lakefront Home in Big Bear in 2011: $1,033,870

Avg List Price to Sales Price Ratio for a Lakefront Home in Big Bear in 2011: 94%

Avg Sold Price per Square Foot for a Lakefront Home in Big Bear in 2011: $375.25 

Avg Days on Market for a Lakefront Home that Sold in Big Bear in 2011: 166 Days

CLICK HERE TO VIEW EACH LAKEFRONT SALE IN 2011 FROM A GOOGLE MAP.

• 50% of all lakefront properties sold (8 out of 16) were paid with cash.  That’s slightly higher than the average for the entire Big Bear Valley area (37%) in 2011.
• After a slow start, there was a high percent of lakefront sales closing in September and October in 2011 (7 of 16).  I don’t see any sort of significance here, other than the Summer months produced several sales and it was good to see an uptick in the numbers.
• One property didn’t have the MWD’s required lake frontage in order to have a boat dock in front of it (the MWD requires a minimum of 25′)…it has 10′ but still has a dock in front of it.  I hope that doesn’t come back to burn anyone.

We had 1 Bank Owned Sale, 2 Short Sales, and 13 Traditional type sales.

The interesting thing to note on the traditional type sales is the fact that many of them were sold for less than what they were previously bought for but they weren’t technically “short sales” with the bank.  The owner just lost equity in the home (over 50% of all traditional sales).

What to Expect in 2012:

I will go out on a limb and say that the number of sales in 2012 will be above 20. Normally I don’t like to bust out the crystal ball, but I do see increased activity along the lake and in this price range.  There’s currently 3 pending lakefront sales…and it seems like there’s a contrarian view that real estate is going to come back over the next 3-5 years.

With the lack of precipitation this January, I could also see lower water levels affecting the shallow water lakefronts in a negative way.  It wouldn’t surprise me to see the lake down 5-6′ during the Summer, which doesn’t sound like a big amount but it will affect some of the properties currently on the market.

If you have a question, or if I can help you with your search in any way feel free to call or email me.  I’m here to help.

643 Cove Drive

643 Cove Drive- This was the first property the investor bought.  Located in the Papoose Bay Estates subdivision, this property is a deep water lakefront that faces west.  Paid $1,595,000 in August of 2006….owner has discounted it 20% and is now up for sale at $1,275,000.

811 Peninsula

811 Peninsula- This is a beautiful full log home that faces Boulder Bay and was purchased in July of 2009 for $2,000,000.  Owner has discounted this home 25% from what they paid for it and have it back on the market at $1,500,000.

200 N Eagle Drive

200 N Eagle Drive- This property was purchased for $1,750,000 in March of 2009.  Owner has discounted the price on this home approximately 20% down to $1,395,000.

Everyone seems to be looking for a bank owned lakefront home because they think they’ll get the best value on a foreclosure.  Sometimes that’s the case, but based on what I’m seeing, some of the best deals over the past year or two have been from motivated sellers…traditional type sellers who have lots of equity in their home and they want to move on.  I’m guessing this investor has found an investment out of the area and he’s cashing out so he can take advantage of something else.  After all, there’s no mortgage on any of these homes, so he doesn’t HAVE to sell….but he understands the market and has priced them accordingly.

Big Bear will experience its first Polar Plunge March 10. The Plunge benefits Special Olympics Southern California–Inland Empire Region. The event is largely sponsored by the Law Enforcement Torch Run for Special Olympics. It is open to all brave enough to take an invigorating early spring dip in the lake at Swim Beach.

Civic clubs, schools, businesses and other organizations can organize teams, and individuals and families can also plunge. A disc jockey, concession booths, food, games and prizes are part of the fun planned for participants and spectators.

“We’re really excited to unveil the Big Bear Plunge,” said Kelly Kloepping, event promoter. “This is what people would call a true plunge.” She should know. Kloepping, the assistant vice president of marketing and communications for Special Olympics Southern California, hails from chilly Wisconsin, where divers guide the swimmers to the surface from beneath the thick ice.

While Big Bear Lake likely won’t have ice in mid-March, the local Polar Plunge is more akin to a typical plunge than similar Southern California events held at Pacific Ocean beaches. The lake’s water averages about 35 to 40 degrees in March.

Participants gather pledges to raise funds. Registration starts at $50 per person. Plungers have ranged in age from 5 to 80-something years old. These ice-water waders show up in all sorts of getups, from outlandish costumes to wedding dresses. Proposals have been made at plunges.

“Plunging is becoming a sport that draws unique enthusiasts … a true winter outdoors you’re-crazy kind of thing,” Kloepping said. This is a great way for civic groups and school teams to show their spirit, she said. Teams often coordinate costumes and can hold signs. Awards are given for accomplishments such as best costume and highest earners.

On the promotional end, Kloepping is working with Northwoods Resort and Dan McKernan, marketing and public relations manager for the Big Bear Lake Resort Association. The message to visitors will be to come and enjoy Big Bear’s scenery, play games, buy souvenirs, enjoy the food and watch brave children, women and men “freezin’ for a reason,” Kloepping said. Inland Empire Special Olympics athletes will serve as ambassadors. Kloepping plans to officially announce the event at a press conference in January.

The Law Enforcement Torch Run is the largest grassroots fundraising event for Special Olympics. This year law enforcement officers in Southern California raised more than $1 million. Law enforcement agencies participating in the Big Bear Plunge include the San Bernardino County Sherriff’s Department, Beaumont City Police, California Highway Patrol and more. The idea for a Polar Plunge at Big Bear came from Beaumont Chief of Police Frank Coe, Kloepping said.

“They told me because it’s my idea, I have to be the first one in,” Coe said with a chuckle. “The Special Olympics is very important to me. The athletes and their families are just very special people … . The Special Olympics builds their confidence and courage. It’s very rewarding to see the athletes compete and to see the courage they have in doing things we take for granted.”

For more information about the Big Bear Lake Polar Plunge, visit www.sosc.org/bigbearplunge.

Below is a video I found on YouTube from Lake George…they do it every New Years and the turnout is pretty strong!

755 Cove Drive-  Cabin was built in 1947 but was tastefully decorated (sold fully furnished) and in a wind-protected bay (Boulder Bay).  I liked the fact that it had a 3 slip boat dock, the fact that it was on Cove Drive (typically homes in this area have deeper water so the land value is higher here compared to properties further east).  The buyers have already addressed the shake roof (click here to read about city ordinance 2007-373) and it has a nice Old World charm to it.  There was a big disparity between list price and sales price but I think it sold closer to the true value….this was a traditional sale (not a short sale or foreclosure).  The MLS stated that it rented out approximately 125 days for the 1st year it was on the rental program in 2010, so they had good supplemental income while it was on the market.  This closed in June for $735,000.

755 Cove, Big Bear Lake, CA 92315

39008 Waterview- This was partially built (just past the framing stage)…rough electrical and plumbing was done but not signed off by the building inspector.  So whoever bought this will probably have to hire an architect and re-engineer everything.  But they flat out stole this property.  I had a client that wanted to buy this property for substantially higher but the bank stuck with their 1st offer.  Perfect example of TARP money going to work for the banks.  They lost quite a bit of money on this one but I’m sure they got compensated on the back end.  It closed for $360,000 (under land value in my opinion).

39008 Waterview, Big Bear Lake, CA 92315

136 Lake Drive-  This cabin was built in 1950 but was dramatically remodeled in 2009.  Located near Gilner Point, it had 2 offers on it and was a short sale.  We were fortunate to get this one pushed through.  The buyer waited 6 months, was very patient, and everything worked out.  This was a great deal….everything was decorated by Interiors and the property was “turn-key”.  It closed on 9/2 for $700,000.

136 Lake Drive, Big Bear Lake, CA 92315

40041 North Shore- Located on the north side of Big Bear Lake, this Fawnskin property had a 2-slip dock and a guest house.  It was a rental and was a little worn on the inside but the numbers were good.  Fawnskin isn’t always an easy sale…a lot of people want to be close to the ski slopes and the Village but this had nice views looking back at town.  It closed on 9/21 for $899,000.

40041 North Shore, Fawnskin, CA 92333

418 Gibralter- This A-frame was centrally located and in good condition.  For some, it might have been too small (at 1696 square feet and only 2 bedrooms) but it had a nice mountain feel to it and it was priced fairly aggressively.  Lots of upgrades from when I sold the home.  Huge deck on the back with built in spa, tankless water heater, security cameras, etc.  Someone got a good value at $650,000.

418 Gibralter, Big Bear Lake, CA 92315

657 Cienega- This property was located in Metcalf Bay close to Pleasure Point Marina.  I wasn’t a big fan of the water level here, and it was real close to the marina but the house was nice.  Huge open great room with lots of glass overlooking the lake.  3 slip dock and 3 car attached garage.  It sold on 9/28 for $935,000.

657 Cienega, Big Bear Lake, CA 92315

39136 Waterview- This sold in 3 days.  It was custom built in 2007 with views from every room.  Completely gated with a separate guest house towards the front of the property.  Sold for full price at $1,500,000.

39136 Waterview, Big Bear Lake, CA 92315

Outlook for the 4th Quarter

Looking at the last couple of months for 2011, there are 4 homes currently in escrow:

40116 Lakeview- Listed at $1,299,000….this property is contingent upon the sale at 39645 Lake (the sellers on Lake plan on buying this).

39645 Lake- Listed at $929,000….this property has an encroachment issue which is trying to get sorted out.

147 Eureka- Listed at $1,199,000…this went into escrow a couple of days ago but should close before the end of the year.

436 Edgemoor- Listed at $1,125,000…this included 4 other parcels and went into escrow a couple weeks ago.

We might get another sale or two going into the holidays but traditionally speaking we are heading into the slower months.  It’ll be interesting to see how many of the 34 lakefront homes currently for sale stay on the market, and how many decide to re-list in the Spring.  If you’re looking for a waterfront home in the Big Bear area, give me a call or send me an email.  I know this segment of the market very well and would love to help.

So many agents mentally shut off when escrow closes…commission checks are cut and files are closed out.  But there’s still a few things to take care of to ensure a smooth transition.

Utilities-  Now that the property is in your name, you’ll need to get the utilities transferred over into your name.  This seems like a no-brainer, but I can’t tell you how many times a new homeowner drives up the mountain to enjoy their new home and the utilities are shut off….an entire weekend without power, water and gas!

• Call Bear Valley Electric or go on their website and download their application.  You might need to have your escrow information available to reference so they can verify that the property is in your name.
• Call Southwest Gas or go on their website and fill out an application to start service.
• Call Department of Water and Power or go on their website and fill out a water service application.  Again, you will need your escrow information in order for them to process the application.
• Not a necessity, but figure out if you want cable, internet or phone….for some, an hour or two without internet seems like an eternity.  So make sure you contact the appropriate carrier ahead of time.
• Does your property have an alarm?  Call Paul Bernardo over at Lake Alarm (cell phone 909-725-2918) to get everything dialed in.  You want to make sure your new investment is protected and you have a sense of security when you’re not in Big Bear.