Sales dropped 27% this August when compared to August 2009, while the median and average sale prices showed modest gains of  5% and 8%. Last month’s average home price was $272,865 while the average in August of ’09 was $250,120. The median sales price was $187,000 last month compared to $178,000 a year ago.

Looking at median price per square foot, what I believe to be one of the more accurate measures of market value, we also see stability.

Price per square foot bumping along the bottom...

Looking at the graph above, you can see that although there has been up and down movement in the $150 – $160 price range, the median price per square foot has stayed relatively stable over the past nine months.

Again, the question is that although price declines have decidedly slowed if not fully stabilized, will the decline in the number of sales prompt sellers to lower their prices in order to move their properties? Or will the sellers win the stand-off, with buyers giving in and paying closer to the seller’s asking price.

Only time will tell. But one thing is for certain – as far as price declines are concerned, the current direction of Big Bear real estate values is in a much better place than it was this time last year.

(Written by Paul Zamoyta, info@zamoyta.com, 909.557.8285)

The number of sales this July took an unexpected dip. Compared to July 2009, this July saw a 31% decrease in the number of sales of residential homes as reported in the Big Bear MLS.

Although sales slowed significantly, the median price per square foot rose from $154 to $159 from last month, while the average sale price rose from $249,756 in June 2009 to $267,719 this June.  The median sale price saw a similar increase jumping from $182,500 last month to $209,950 in July.

Sellers in July conceded on average about 4% off their list price in negotiations while the average time a home was on market before selling was 104 days.

August should be very interesting. With interest rates hovering around an incredible 4.5%, I would imagine we’ll see more potential buyers making a move.

But as I’ve become fond of saying lately, the only certainty these days is more uncertainty.

Paul Zamoyta ~ 909.557.8285 ~ info@zamoyta.com

Being that we’re looking at a median, it tends to smooth out the exceptionally high and low sales numbers that might influence sometimes deceptive average price numbers. And being that it’s based on price per square foot, the possibility of very large expensive homes or very small inexpensive homes swaying values is compensated for.

So let’s take a look!

Below is a history of the median price per square foot for Big Bear homes as reported in the Big Bear MLS.

If you take the highest and lowest numbers as represented in this graph, you will find there’s a 47% decrease in price per square foot. If you look at the starting number from July 2006 and compare it to the current data for July, you’ll derive  a 45% decrease in price per square foot.

Wow! Nearly a 50% decrease in values in four years.

Although the big question seems to be whether or not values will fall further, when you consider how much homes have dropped in value coupled with the incredibly low interest rates right now, it certainly seems like a great time to buy.

For those that tell me they’re going to wait for the market to drop another 10%, I like to remind them of the relationship between sales price and interest rates. Very generally put, an increase of 1% to your mortgage interest rate equates to about 10% of a homes value.

In other words, if you buy a $300,000 home today and you put 20% down, your mortgage will be for $240,000. At 4.5% interest, you’ll be paying $1,216/month.

If you wait for the home to drop 10% further to $270,000 and put 20% down, your mortgage would be for only $216,000. But in the meantime, if your mortgage rate increases to 5.5%, your payment would actually be higher at $1,226/month.

Of course, no one knows what will happen to prices let alone interest rates over the next few months. But ultimately, the better informed you are, the better the chance you can make the right decision when the time is right.  

Paul Zamoyta ~ (909)557-8285 ~ info@zamoyta.com

Number of sales ~ 2009: 367 /2010: 399 ~ 8.7% increase

Average Price ~ 2009: $283,747 /2010: $243,731 ~ 14.1% decrease

Median Price ~ 2009: $220,000 /2010: $185,000 ~ 15.9% decrease

Avg Price per SF ~ 2009: $185 /2010: $170 ~ 8.1% decrease

Days on Market before selling ~ 2009: 131 / 2010: 122 ~ 6.9% decrease

Percent of sales price to list price ~ 2009: 95% /2010: 95%

Bank Owned Sales (as % of total sales) ~ 2009: 41.3%/ 2010: 42.2%

Short Sales (as % of total sales) ~ 2009: 8.2% /2010: 13.3%

As you can see, compared to the first half of last year, we’ve seen sales continue upward, although modestly. Prices have seen about a 15% decrease and a more slight 8% decrease in price per square foot.

The time that homes are listed for sale before actually selling and the amount that sellers negotiate down off their list price have stayed relatively unchanged.

Bank owned properties have stayed more or less constant, composing just over 40% of all sales. Short sales, however, seem to be increasing in market share.

As many now know, a short sale is a transaction in which a homeowner is looking for their bank’s approval to sell their home for a loss. Because the owners are selling the property for less than what is owed on it, they need the bank’s permission to do so.

Both sellers and the lenders oftentimes are motivated to take part in a short sale as the owner avoids a foreclosure on their record (although they still take a significant credit hit) while the bank doesn’t have to go through the lengthy and expensive foreclosure process.

Although these transactions seem to be becoming slightly more popular, the number of Big Bear homes to sell as a short sale each month do not appear to be an overwhelming number.

From the graph above, you can see that there are only about 8 – 12 short sales of Big Bear homes each month, accounting for only about 10% - 15% of the market share.

Many sources have said that short sales will become more prominent as banks, already overwhelmed with existing bank owned inventory, will try to avoid additional costly foreclosures. Ironically, short sales are usually anything but short and have the reputation of sometimes turning into time-consuming fiascoes. It is not unusual for banks to be unorganized and illogical in their decision making, leaving agents to wonder whether it is truly a matter of the bank negotiator’s incompetence or if the lenders have some other ulterior motive in delaying or denying short sale approval.

The bottom line is that for every short sale that is approved, there are likely several times those which fall apart for one reason or another, with the property in question ultimately ending up being foreclosed on.

Although there are many unsuccessful short sale sellers and unsuccessful short sale purchasers who would advise you to stay as far away as you can from these frustrating and lengthy attempts at a transaction, there are also those who were successful in their attempts and feel their efforts were well rewarded.

If you are thinking of short selling a Big Bear property or are interested in buying a Big Bear home that is a short sale, please do not hesitate to contact me for more information.

Paul Zamoyta ~ INFO@ZAMOYTA.COM ~ 909.557.8285    

www.BigBearLakefrontRealEstate.com

June of 2009 saw 79 sales whereas in June of this year, sales dipped to just 72.

Median and average sale prices of Big Bear homes also showed a year-to-year decline. The average sales price in June of 2009 was $294,000 compared to $250,000 this June. Whereas the median sales price in June 2009 was $252,000 compared to $182,500 last month.

Price per square foot showed similar declines selling on average at $168/sf this June compared to $183/sf in June 2009.

In comparison to May, June saw it’s usual uptick in activity with the number of Big Bear home sales seeing a 29% increase.  The average sale price from May to June stayed relatively the same with May’s average being $248,894 while June’s was $249,756.

Traditionally, July through September are are busiest months for home sales in Big Bear. With interest rates dipping to well below 5% and prices reverting back to 2002-2003 levels, it will be interesting to see if we experience increases in the number of sales on a year-to-year basis once again.

In comparing Q1 of 2009 to Q1 of 2010 for pricing though, there were drops of 14% and 10% respectively in the average and median prices. This should not come as a surprise as most followers of the local real estate market realize that prices have continued to slide, albeit more slowly, over the past year. The silver lining is that this year’s annual drop is about half of what it was the previous year.

As you look at the graph,  prices have been bumping up and down from quarter to quarter with the overall direction being downward for most of the last two years.

The good news is that it looks as if prices are starting to do the proverbial “bumping along the bottom”. When you consider the last three quarters, you can see that the low points start to show an upward trend in pricing. In that regard, you could even make a case that things are starting to bump up.

With home inventory almost 50% lower than last year, the number of Big Bear home sales slowly but consistently increasing, and with aggressive government sponsored loan modifcation efforts set to begin on April 5th that aim to keep people in their homes and out of foreclosure, there are more than a few hopes to hang your hat on.

I’m not calling a turn-around yet, but the signs sure are looking better.

Paul Zamoyta ~ (909) 557.8285 ~ info@Zamoyta.com

50 degrees and sunny today!

From January 2010 to February 2010, the average and median prices of Big Bear homes showed appreciation, while comparisons to 2009 values show just how much the market has fallen over the past year. The one consistent measure is that the number of sales has moderately and consistently increased across the board.

Comparing January 2010′s sales to February 2010′s sales, there was an 18% increase in average sale price and an 11% increase in median sale price. The number of sales from last month also rose by 8%.

Comparing February of 2010 to February of 2009, average price dropped 13% while the median price saw a 16% fall. Sales, although, saw a 7% increase.

In the Year-To-Date comparison, comparing January and February of 2009 to January and February of 2010, average prices have dropped 16% while the median has dropped a significant  27%. The number of sales though has moderately increased by 8%.

These numbers show how Big Bear real estate prices have continued to fall over the last year, but at slower rates than the previous year. The number of sales has continued to improve, while inventory (as mentioned in a previous post) has fallen dramatically.

Although a mixed message for the Big Bear real estate market, as long as Big Bear home sales increase and inventory stays at today’s numbers, it only makes sense that property values should bottom out. But like all areas of the economy right now, no one is brave enough (or idiotic enough) to predict with certainty what the next few months will bear. The one thing I can say relatively certainly, is that numbers-wise, we sure seem in a better place than we did this time last year when inventory was 50% higher and two years ago when the number of sales were 30% fewer.

(If you have any questions or comments about this blog post or Big Bear real estate in general, please contact me at info@Zamoyta.com )

Big Bear home inventory continues to fall. A good sign suggesting market recovery.

It’s looking like we’ve seen about a 30% drop in the number of homes for sale from last year. This is due to the 30% increase in sales we saw as buyers took advantage of the down market’s good values. As well, sellers who can choose not to sell at this time are doing just that – waiting.

Anyway you look at it, a decreasing inventory is better news for values than a steady or rising inventory. It’s nice to see consistent signs of things getting better heading into 2010!

Paul Zamoyta ~ 909.557.8285 ~ info@ZAMOYTA.com

Regardless of being a weak month to use as a comparison, it might be more revealing to compare January 2010 to previous January numbers.

Looking at these numbers, you can see an obvious trend downward, but the potential positive here is the leveling off of the price per square foot.

I have often stated that the price per square foot, in my opinion, is perhaps the most accurate indicator of where market values stand. In a previous post, I noted that in the 4th quarter of 2009, the uptick in price per square foot of Big Bear homes was a huge positive sign. On the same note, the slowing of the decline in January 2010′s price per square foot is far better than the pace in which things had previously been falling.

Comparing the number of January sales to the average amount of time a home is on the market reveals some better news too.

Note that while January sales of Big Bear homes have  gone up over the last few years, the median amount of time a property is on the market before selling has come down significantly. Sales rising and homes selling more quickly is a positive sign that we are much better off than in 2007 and 2008 when sales dropped by almost 70% and over half the homes took over 4 months to sell.

So the big question is whether or not the Big Bear real estate market has stabilized. As I regularly say here in my forum, no one can definitively tell you what the future holds. But by looking at the market numbers not only in this January comparison, but also from over the last few months, the conditions of the Big Bear real estate market are far better than they’ve been in quite some time.

For more information, or for any Big Bear real estate questions you may have, please contact me!

Paul Zamoyta ~ 909.557.8285 ~ info@ZAMOYTA.com