Big Bear’s COVID-19 Information: Will It Affect Real Estate?
Unfortunately, the Now-Categorized Pandemic COVID-19 Corona Virus Is Having Its Effect on Our Big Bear Mountain Community
Today in Big Bear Lake California, Snow Summit Ski Resort and Big Bear Mountain Resort has officially announced the temporary closure of both resorts putting a halt to Big Bear’s winter sports activities. The Alterra Mountain Company made this public announcement:
March 14, 2020, Denver, CO: “After careful thought and deliberation of our duty in the face of the COVID-19 (Coronavirus) outbreak, and in what I believe is in the best interest of our guests, employees and local communities, Alterra Mountain Company will suspend operations at our 15 North American ski resorts, starting the morning of Sunday, March 15, until further notice. All lift operations, food and beverage, retail and rental services will be closed until further notice.
Alterra Mountain Company destinations are Steamboat and Winter Park in Colorado; Squaw Valley Alpine Meadows, Mammoth Mountain, June Mountain and Big Bear Mountain Resort in California; Stratton and Sugarbush Resort in Vermont; Snowshoe in West Virginia; Tremblant in Quebec, Blue Mountain in Ontario; Crystal Mountain in Washington; Deer Valley Resort and Solitude Mountain Resort in Utah; and CMH Heli-Skiing & Summer Adventures in British Columbia. (CMH Heli-Skiing & Summer Adventures will continue to operate through Tuesday, March 17.)
Each resort will work directly with guests in canceling their visit and will provide refunds to those who have hotel and other bookings during this closure period. We anticipate heavy call volume over the next several days and appreciate guests’ patience as we work hard to respond to all inquiries. For inquiries regarding current BBMR reservations, please call (844) GO2-BEAR.
I sincerely apologize for the inconvenience this short notice will undoubtedly create. We look forward to welcoming you back to the mountains as circumstances improve.”
In other local Big Bear News. The Bear Valley Unified School Districts Superintendent of Schools has made this announcement regarding School Closures.
“All Bear Valley Unified School District’s schools will be closed from Monday, March 16th through Friday, April 10th. Although there are no current cases of Novel Coronavirus COVID 19 reported in San Bernardino County or in Bear Valley Unified, the health and safety of our students, staff and our surrounding community is a priority.”
The novel Coronavirus that causes COVID-19 has taken a toll on economies globally and now locally. Who would have thought our little town on top of the San Bernardino Mountains could adversely be affected by a Virus originating from a small province in China weeks earlier. From stocks to tourism to the real estate industry this uncertainty hanging over the market is causing people to ask the questions, how will real estate respond in the short term, and what will occur on the broader horizon?
As quickly as the new Coronavirus crossed China’s borders, the impact on the financial markets has been almost as swift. Fearing a bear market, investors directed their capital reserves to the relative safety of the bond market, resulting in the largest one-week stock market drop since the 2008 financial crisis. The Dow just had its biggest crash since 1987.
A special report from a large commercial real estate firm points to recent history as an indicator for how long and how far reaching this market correction might be. SARS, H1N1 and other recent pandemics also generated short-term market volatility. While it’s still too early to compare the full health impacts of COVID-19 with those strains, the markets stabilized in the range of three to six months on average during past events.
Separate from this new health scare, nationally real estate supply and demand are largely in balance. Locally in Big Bear Lake we are averaging 103 closed escrows a month with an average sales price of $298,081. As of today, our current inventory of Big Bear lake active listings is hovering at 390 active residential listings up nearly 40 homes than the last 90 day average. I definitely see in the next 60 days an increase in supply of actively listed homes for sale.
The biggest real estate impact from the coronavirus will be in the vacation rental or short term rental markets as tourists cancel vacations and corporations curtail employee travel. With Big Bear Lake being a vacation destination and a tourist based economy we will see the local economy affected. The effects will be determined by the longevity of the current global travel restrictions and closures of large public venues. Currently the iconic vacation rental sites such as VRBO, Homeaway and AirBnB are on top of it helping rental hosts and consumers with tips, resources and policy changes in light of the COVID-19 virus.
What I continue to read is in the short term, the novel coronavirus will do little to drive down demand for full time housing in the U.S, resulting in a continued favorable rental environment. At the end of 2019, multifamily vacancy rates in the U.S. stood at 4.2 percent. Thoughts that I have shared with my clients who own a vacation rental property is to possibly change their business model of being a vacation rental to a full time rental unit. Big Bear Lakes full time rental market has been hit hard due to the increase in demand for short term vacation rental income producing properties. The demand for full time rental homes and the lack thereof has driven up monthly rent schedules making it an advantages alternative for some home owners.
It is unsure what detrimental impacts the COVID-19 will have on our Big Bear Real Estate Market or the value of your home. With a shortened ski season, fear of traveling and economic impact of disposable income, families and individuals will surely be curbing their spending on vacations. At the same time, for those with the ability to purchase real estate this could prove to be a tremendous buying opportunity with potentially fewer competing offers, increase supply and low interest rates. Some investors are even looking to real estate following the uncertainty with the stock market.
I hope you find this helpful, my resources for this information is in correlation to responses to pandemics from the recent past, current market analysis, 25 years of real estate investing and the current situation with COVID-19. One point that should be addressed is If consumer confidence levels plummet and/or stock market volatility swells out of control, the situation could be far different.
PLEASE BE SURE TO DO YOUR PART ON KEEPING THE PUBLIC SAFE. WASH YOUR HANDS AND BE AWARE OF YOUR SURROUNDINGS.
