Question about Big Bear Lake CA

[Jennifer McPherson]

I have been doing a lot of research into where we might buy another STR and was looking at Big Bear Lakes, CA because it is very close to a downhill MTB park and my kids race DH and have always wanted to get a place close so we can go spend a few weeks there whenever we want.

WHY.... are there so many places for sale here?  Red flags are going up around me regarding this area.  Anyone know why this is?

Thank you!

Jennifer

[Sharon Sasser]

Quote from @Craig Tomlinson:

Quote from @Sharon Sasser:

Hi Jennifer, it's been a while since I have been on the forums.  I thought I would check out the Big Bear forums and see what is new from the last time I checked.  I just purchased in Sugarloaf.  That's after 3 years of intense looking and two offers in 2019 that I got cold feet on because it would have been the first investment property that I have owned.  I kick myself for not buying back then.  Both those homes were in Moonridge and in the 600K value range now.  A lot has changed since you posted this question 4 months ago.  I did make an offer in January 2022 on a home in Sugarloaf.  It was a cute A frame and ending up selling 30K over asking price.  I offer listing price and a bunch of people swooped in and bid up the price, so I checked out.  I didn't feel right to make an offer that high.  330K for a tiny 1bed, 1 bath with loft cabin.  It was like this for all homes I was looking during this time.  Bidding wars abound for every property I wanted to make an offer on.  After the interest rate hikes of late.  I saw an opportunity to buy because properties were remaining on the market for a long time.  Interest rates priced buyers out of the market because the returns no longer made sense.  I got a decent price on a cabin compared to my peers earlier this year.  My cabin is in a better location of Sugarloaf, it's walking distance to national forest, over 1k square foot home, and the lots across the street aren't developed so it feels less crowded.  My kids have freedom to play safely in the snow.  I plan to refinance when the rates go down.  I see opportunity abound as the Federal Reserve is intent on forcing us into a recession.  Those who have saved for this point in time will find much better deals than their peers did during the pandemic buy surge.  Hope to hear more on here from others and their thoughts and experience with Big Bear, especially from fellow hosts like me.  Returns in Big Bear never made sense going with traditional management companies.  I will have to self-manage like I do our rental in Hawaii.   

 Hi Sharon, 

Im curious how your purchase in Big Bear has performed? Like you, I evaluated a bunch of properties back in 2019-early 2020 and regret not making a move back then. But hingsight is always 2020. Have you been able to make profitable returns in Big Bear?

PS I love that you also have a place in Hawaii. How Awesome! Thank you for insight you might have for someone interested in the area of Big Bear Lake!

 Craig,

Good question. Apologies for the delay in responding. It's a super saturated market following the pandemic work from home demand. Hosts were making a lot of money then, but the demand has dried up and there is now a ton of competition due to a lot more rentals on the market. So many people purchased in the hopes they could get in on the cash cow, but failed to see how temporary those profits would be. I purchased knowing it wasn't likely going to be covering all my debt service, but that it might cover close to most of my debt. We love Big Bear, so we come up a lot to enjoy the cabin. I try hard to market it and adjust prices to attract bookings. Everything is brand new in the cabin too and our listing pictures are professional. I see a lot of cabins are going on the market now. A mix of people that purchased during the FOMO covid cabin craze and owners that have had their cabin for years. It looks like the market is trying to correct and weed out all the speculators. Prices are coming down a bit. It's a good time to buy a cabin if you want to get in on a second home, but not yet a good time to buy if you are expecting a profit on your investments. Prices are going to have to come down substantially more for it to be considered a good investment for covering the debt service. I don't regret the purchase because I always wanted a cabin in Big Bear and am with what we picked and the location to the forest. 

2023 I made around 4K in profit. I have only had around 4 bookings so far in 2024. Not a good return on investment, but I am having a blast with my family enjoying the cabin.