Big Bear Bummers

Address: 724 Georgia St, Big Bear Lake, CA 92315

Link: https://www.redfin.com/CA/Big-Bear-Lake/724-Georgia-St-92315/home/3509169

 Beds/Baths: 2 beds, 1 bath, 600 squares

Purchase Price (1/2022): $495,000

Asking Price (9/2024): $460,000

Difference: -$35,000

Commission (3%): -$13,800

Total Loss: -$48,800

These people purchased in early 2022 for $495,000, and in March 2024 attempted a $539,000 money grab. Then, after wasting months with chickenshit price cuts that conveniently preserved their ability to walk away with a profit, the asking price finally crossed the Rubicon into a money-losing proposition.

Good on ’em for finally acknowledging that the market has changed since the halcyon days of ever-increasing values, but this is going to hurt. Assuming they can find a buyer for the current demand of $460,000, they will eat nearly $50,000 for just 2.5 years of ownership. That’s a tough lesson in the perils of irrational exuberance, but here we are.

Unfortunately, $460,000 – just 7% less than they (over)paid at the peak of the pandemic-era frenzy – is not going to happen. Because at the end of the day this is a 600-square-foot cabin. Yes, it’s pretty tidy with decent updates, but as a tiny 2-bed/1-bath its use case and future value are extremely limited.

By the way, I love that the “fireplace” is just a space heater:

And, uh, 600 square feet might be an overstatement. Because at the very end of the listing description we learn: “Property profile says 1 bedroom and 1 bathroom and 498 sq ft.”

OOOOOOOPS.

Better hope you can find the permits for that bedroom addition.

Although they have gradually come down in price from their initial $539,000 ask, $460,000 still seems INSANE for 600 non-lakefront square feet. That’s $767 per square! Or $920 per square if you go by the size listed in the public records.

This larger property nearby can’t even get $425,000 (it’s not nearly as nice, but still):

And this larger, albeit much rougher property can’t get $385,000:

And although this place is super outdated, it’s more than twice as big at $475,000:

Hence why our featured seller has been begging on the market for 235 days.

Outside of a once-in-a-generation housing bubble brought on by a global pandemic and the Fed’s money printer being stuck on overdrive, how could this place objectively be worth $460,000? Or even $400,000 for that matter?

These people way overpaid and are going to get crushed. How heavy their loss is remains to be seen, but I wouldn’t be surprised if they have to give up most of their down payment to get out of this unenviable situation.