Big Bear Market Report July 2009

The Big Bear Report

A Monthly Review of the Big Bear Real Estate Market

July 2009

For the first time in 10 months, the median home price in Southern California did not decline. The result of combining record low interest rates and the sharp decline in overall sales have given some real estate "experts" an indication that we may be close to hitting bottom. As I've mentioned in previous reports, no one can predict the bottom until we are on our way up.There are just too many variables, especially with the current administrations illusion on capitalism.

My personal observation (along with many "down-the-hill" brokers) is that sales activity at prices below $500,000 has really picked up, but that the $500,000 and up range is very soft right now. A significant factor that affects our ability to attract "upper end" prospects to areas like Big Bear and Lake Arrowhead is our regional county loan limits. San Bernardino may be the largest county in the country but we have the lowest of the conforming loan limits available, currently $417,000. Orange and Los Angeles counties are currently $729,750 and San Diego's conforming loan limit is $697,500. Perhaps we will see a "trickle" up effect as sales continue to pick up in the lower ranges.

If you think about it, the "buying public" is in the midst of a perfect storm. With the likely possibility of inflation rearing it's ugly head, it's important to remind any investor that real estate has always proven to be the best hedge against inflation. This makes investing a much more serious strategy than at any time since the depression.

Short sales and bank owned property will likely remain a fixture in the coming months and may continue to be the driving force behind keeping the median home prices soft. However, not all prospective buyers today are attracted to the inherent risk and inconveniences of buying a "bank controlled" property.

Unfortunately, it seems our personal economic survival is no longer based on the work ethic, but rather recognizing that our current administration wants to reward mediocrity at the expense of the ambitious. Until next month...

Mike Dolan

Big Bear's Leading Realtor

# 8 Prudential Agent Award

7 time PREA 100 Award

11 time Diamond Circle Award

2 time 5 Year Legend Award

(909) 866-6453 (Office)

(909) 936-6453 (Cell)

mikedolan@bigbearproperties.com

Mikedolan.com