Big Bear Bummers

After roughly 120 days on market they finally found a buyer. Although they didn’t get the $325,000 windfall they were initially hoping for (assuming a 3% commission), walking away with $265,000 after just three years of ownership is nothing to shake a stick at.

This seller had a few key things going for them:

1. They bought well in 2021 ($840,000),
2. They completed meaningful upgrades and maintenance,
3. The listing photos are high quality,
4. The house is super dialed in with killer views, and
5. They were willing to accept a low offer (-$60,000 under asking price) to get the deal done.

I still think the new buyer overpaid – $470 per square foot seems pretty high. They are likely catching a falling knife, but they clearly have a bunch of cash lying around so they’ll be fine in the long run. And there is no arguing with the market…$1,140,000 is what someone was willing to pay for this place. A comp is a comp.

My main concern is this big, albeit discounted, sales price will give nearby sellers the impression that the good ol’ days of massive profits are back, prompting them to hold back on much-needed price cuts.

Going to be an interesting winter…

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Address: 1273 Pigeon Rd, Big Bear Lake, CA 92315

Redfin: https://www.redfin.com/CA/Big-Bear-Lake/1273-Pigeon-Rd-92315/home/3511289

Beds/Baths: 4 bed, 2 bath, 2,424 squares

Purchase Price (10/2021): $840,000

Asking Price: $1,200,000

Difference: +$360,000

Commission (5%): -$60,000

Total Gain/Loss: +$300,000

Anybody know the first rule of selling drugs?  That’s right: Never get high on your own supply.

Unfortunately, that’s exactly what this greedhead seller did. He smoked alllllllllll the crack rocks and came up with this asking price.

And those rocks would put Boulder Bay to shame. 

Don’t get me wrong – this place is sick. Amazing deck, lots of square footage, nice updates, stellar design, super clean. I absolutely love it. If these dreamers did a complete renovation I might kinda sorta maybe see where they were coming from with their (wildly ambitious) Wishing Price. 

But according to the old listing photos they didn’t do a full reno and most of it was like this when they purchased in 2021. 

The seller did shell out for a new roof (not cheap, I’ll grant them), Bosch oven, hot tub, pool table felt, vinyl floors (which frankly look worse than what was there before – wrong tone, bro), but other than that it doesn’t look like they did a whole lot.

The bathroom is nearly identical. This photo is from the 2021 listing (I love the phone right by the shitter — please tell me they kept that):

And this photo is from 2024 — looks like they added some paint and new artwork (same decorative plant and rug though):

So how can the seller justify a profit of 300 grand after commissions for less than three years of ownership?  A period during which interest rates more than doubled, sales cratered and insurance costs dramatically increased?

They can’t.

This is straight up delusion. 

The dead giveaway these people aren’t playing with a full deck is this flowery word salad of a listing description:

Nestled amidst the majestic mountain beauty of all that is Big Bear Lake, this modified A-Frame cabin captures you at first glimpse. The lower entryway way invites you to experience the epitome of mountain living in California, surrounded by trees, nature and glorious views. Situated in the serene neighborhood of Moonridge, this charming retreat offers a tranquil escape whilst being a 5 minute walk to Bear Mountain Resort, for all those snowboard and skiing lovers. For more added convenience, explore the wonders of nature on the National Forest Truck Trails hiking path, also a 5 minute walk, perfect for outdoor enthusiasts seeking adventure. It’s very tough to beat this location; the Alpine Zoo and the 9-hole golf course are also a hop, skip ’n jump. With all-new flooring, furniture, and appliances spread throughout this 2,424 sqft home, this meticulously maintained 4 bedroom, 2 bathroom residence exudes comfort and cabin-style. Cozy up by the gas or wood-burning fireplace, entertain in the family room with a game of pool or compete on the Pac-man game. Whatever your heart desires, this A-Frame will have you indulge in all its amenities, such as the indoor spa-room on the bottom floor, which is accessible from the master suite and bottom deck. Additional highlights include a boatload of parking spaces and ample amounts of serene, forest views. This is a perfect opportunity for a part of full-time STR, as it boasts amazing revenue so far just in 2024. This home boasts a plethora of recent upgrades, including a metal roof upgrade in 2023 with a lifetime warranty, a new Bosch range, and a spacious enclosed woodshed. Enjoy the outdoors fresh scent and breeze from the reconstructed upper deck, strengthened for year-round durability, or unwind in the indoor spa room featuring a new 5-person spa and wine cooler, in case you fancy a few tipples with the bubbles. Easily immerse yourself in the local culture and community with quick access to nearby restaurants, shops, and every recreational opportunity at hand. Big Bear Lake itself a short distance away if your vocations are in water sports, fishing, and romantic lakeside picnics. Discover the perfect blend of mountain-luxury and pure convenience at 1273 Pigeon Rd, where every detail and decor has been thoughtfully curated for modern mountain living. Embrace the tranquility and charm of Big Bear Lake in this exceptional property.

And what is going on here?

Big Bear Lake itself a short distance away if your vocations are in water sports, fishing, and romantic lakeside picnics.

“Vocations”?  Was this written by ChatGPT?

My favorite part:

This is a perfect opportunity for a part of [SIC] full-time STR, as it boasts amazing revenue so far just in 2024.

If this claim about “amazing revenue” was true, why on earth would they let go of such an incredible cash cow? 

We all know why.

Anyhow, are you interested in rewarding this seller for all of their “hard work” of paying a mortgage for a few years?  Here’s what you’re looking at:

Asking price: $1,200,000 (LOL)

Down Payment (20%): $240,000

Monthly Payment: $8,279/mo (@7.4%)

Yowza!  Nearly $100,000 a year in overhead.  You’re going to need a lot of short-term rentals if you want to knock down those onerous carrying costs. 

Considering this person paid nearly half a million dollars less with a much lower interest rate and they still can’t make it pencil out as a rental, what are the odds that you’ll be able to?

This is undoubtedly a very special property, but that is clouding the seller’s judgement. The current asking price is frankly insulting.

Although they bought early enough during the frenzy that they will definitely walk away with a nice profit (those gains from 2021-2022 haven’t been totally erased for quality properties) $1.2 million represents a 43-percent increase in value in two-and-a-half years. I just don’t see how that makes sense in today’s market.

Someone who loves the smell of their own farts as much as this guy is going to be reluctant to cut the price significantly because it would mean having to admit they aren’t as smart as they think they are. To these kinds of deluded fools a price cut is like giving Narcan to a heroin addict — it immediately kills the high.

So they will likely continue with their steadfast dedication to pure, uncut greed.

But all it will take is a few desperate Moonridge sellers to let their properties go for 2021 prices and our hubristic seller could suddenly be staring down the barrel of a financial loss, rather than the $300,000 bonanza they’re banking on.