Mammoth Lakes, CA

These photographs were taken by Robert Swetz 5-23-2009 at Mammoth Lakes California - duplication is prohibited by copyright laws - all rights are reserved. I have re-sized the photos so they may be a little fuzzy.

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Mammoth Lakes California Real Estate

Mammoth is located in California midway up the state where the California Nevada border where the angle changes direction. This area is the Eastern Sierra Nevada mountain range and is accessible year-round for winter as well as summer activities. Winter activities include: skiing and snowboarding on Mammoth Mountain’s 3200 skiable acres and varied terrain, snowmobiling, sledding, ice skating, snow shoeing, cross country skiing. The Eastern Sierras are well-known among fisherman for some of the best trout fishing around. There are numerous lakes accessible by car as well as those in the back country, all fed by snow melt run off. Department of Fish and Game stock many of the lakes in easily accessibly areas and also in the back country by airplane. Summer activities include fishing, fly fishing, camping, hiking, mountain biking on Mammoth Mountain, paved bike trails through the Town of Mammoth, floating down the Owens River, art festivals, jazz festival, ‘green’ festival and many more.

Homeownership in Mammoth Lakes California is dominated by second homeowners and investor ownership. Given the ever changing financial markets, financing for purchases is still available, it’s just that the guidelines are more restrictive. With income documented by pay stub, about a 25 – 35% down payment and a credit score of 720-780, and a property NOT classified as a condo-hotel, you should be golden in getting a loan. And interest rates are in the high 4’s but that could change any time.

If you are wondering why you should buy a home in Mammoth now, let me give you some good reasons:

· Prices are down approximately 42% from late 2005/early 2006 prices

· Selection is great with over 330 condos currently on the market

· Interest rates are low

· If you are a cash buyer, you have great negotiating power on property priced over conventional financing limits.

· If you would like to buy a primary residence in Mammoth, you can take advantage of the $8000 tax credit and if it qualifies by FHA, you could use that tax credit towards your down payment in some circumstances.

Search listings NOW at Mammoth MLS Listing (http://www.mammothmlslistings.com)

Courtesy of:

Stacie Robbins, Realtor Associate

Coldwell Banker Mammoth Real Estate

Stacie@OwnMammoth.com or on my cell at (760) 793-6344

Mammoth Foreclosures 4.0––Walk-Aways and Weasels This column has been delayed several times by work duties, showing property, great ski conditions, and my ongoing attempt to understand how the Stimulus and Housing Bills and foreclosure intervention by the government will ultimately affect the Mammoth real estate market. My summation at present: the artificial delay of many foreclosures that began early last fall will now only further postpone the inevitable and will prolong and flatten the downward slide of real estate values. Many can argue the virtue in these actions, but I’m more of the Tea Party mindset. But all these delays are much to the chagrin of many would-be buyers in the local market who are regularly scrutinizing the inventory online and are trying to somewhat time the bottom and who are getting impatient because they want to “set themselves up” before they’re too old. Maybe the Ski Area can bring back the senior citizen pass especially for them. Very little of the Washington salvation packages directly apply to Mammoth. We have a small percentage of owner-occupied properties. Conforming loan limits eliminate another large percentage. And those owner-occupied locals that are in trouble can’t qualify for much because they already have late payments and few, if any, can meet the “affordable” criteria (that is unless they already live in “affordable” housing). Even the Ski Area appears to be having they’re own stimulus epiphany (like every other local resident, at least those not lost in denial, has been experiencing for at least the past year.) The revelation is that survival now means discounting EVERYTHING, getting volume up, cutting costs, and becoming more humble and proficient at what you do. The good news: air service is working and we’ll have water this summer. Despite the government intervention efforts, Mammoth foreclosures continue at a slow but steady pace. My projection is that we’ll be at a similar pace for 2009 as we were in 2008, or maybe a little more. (One reader suggests that based today’s economic environment that I shouldn’t predict things beyond a few months, but I’m trying to plan fishing trips.) There is no flood of distressed property in the pipeline, no alarming concentrations of stress, and no apparent rush to exits (but that is one of the underlying rationales for the intervention.) But the foreclosures will continue to set the pace for prices in the market. So far they are driving prices down, but they are also finding the levels where there are ready, willing and able buyers. Price support is a good thing and we are clearly seeing it in the low-end of the market. (The foreclosures we are handling in the Bishop area are definitely finding solid price support.) However, I see an insidious hidden indicator in the Mammoth MLS and it is growing. They are called short sale listings, and every agent in town (not me) seems to be taking them on. Regular readers know how I feel about short sales in this market. (My office did recently complete a short sale, but it met the two most important criteria: an owner occupied property and provable hardship.) The volume of new short sale listings could be telling, or maybe not. Stressed owners are thinking it could be the easy way out instead of foreclosure or enduring the pain. “Short sale experts” are popping up all over the place (don’t pre-pay any fees!!) Increasingly desperate (and inexperienced) agents are taking them on not knowing the work and uncertainty involved. The process can take many months and while it is going on an REO (or other real seller) can pop up and make the short sale deal not look so appealing to the buyer (now happening with frequency). And banks are now playing new games with non-hardship short sellers like demanding cash, or cash from credit card cash advance lines, or going after anything of value the seller has before finalizing the transaction. (The short seller is going to have to expose their full financial picture to qualify for the short sale—no more “stated income” shenanigans.) Further, the “bank” may just be servicing the loan for an investor (a non-portfolio loan) and the investor may be distracted or not care for a short sale. But I digress. The REAL issue is how many of these proliferating short sale MLS offerings are future foreclosures. The trend is already clear. Many short sale listings end up as foreclosures. Savvy buyers are beginning to see and understand this trend. But again, the real issue is how many of these new and growing short sale listings will end up as foreclosures. Although there has been some signal from the lenders that they have some appetite for short sales, I see no indication they are moving strongly in this direction. (Part of it is they are overwhelmed.) Which brings me to the title of this column––Walk-Aways and Weasels. That seems to summarize the attitudes I’m observing of these distressed sellers. They seem to fit into one of these two categories. Many of these new aspiring short sellers would like to be Walk-Aways but they don’t want to destroy their credit. But many don’t want to put forth the effort (and disclosure) to facilitate the short sale. Or they don’t want to put anything in (like cash) to make it happen. They want their cake and eat it too. In the Mammoth foreclosure market there have already been many true Walk-Aways. They rolled the dice and lost. They’re not asking the casino for their money back. They’re not whining about being victims. They politely walk away with their dignity (or the appearance thereof). They don’t rob the property. And some of the owners who might even qualify for a short sale don’t even try. We were recently assigned a new REO listing in the Village and you never know what you’re going to find when you walk in the door the first time. So there it was: clean, everything in order outside of a little wear and tear, almost like you would find it if you were a paying guest, except a bit dusty. When we went to put the electricity on we discovered that the service had been off for a year. The owner knew it was over a long time ago and didn’t abuse it, didn’t even use it, didn’t rent it, nothing. Just used their last freebie buffet coupon and left quietly. On the other hand are the Weasels. Here’s the opposite experience––one foreclosed Village owner was still renting (and taking money from renters) a month after he had been foreclosed on. (There’s a nice resort experience for one of our visitors, “ah, well sir, the unit you rented was foreclosed on a month ago and the bank isn’t renting it out and you’ll have to get your money back from the previous owner, but we have some similar units available at $$$ a night.”) While the Walk-Aways are pretty easy to deal with, the Weasels are always something else, and sometimes disgusting and entertaining as well. The banks have a way to keep the Weasels at bay for the most part, it’s called “cash–for-keys.” It’s right out of the old landlord’s handbook––paying undesirable tenants to leave, leave the place in good shape, and sign their rights away. Foreclosed on owners, or their tenants, can get a check for being nice Walk-Aways. And then there’s the weaseliest of the Weasels, and I just can’t help telling you about him because if you met him you just might think he’s a nice guy. But he is a small but prime example of why we are in this global economic pickle today that will cost us for decades to come. I refer to him as Bugs Bunny. See Bugs was a “real estate investor” and he always let you know it. He was a client of one of my former associates. We have subsequently ended up handling a property he was foreclosed on. As all the paperwork flows through my office, the financial damage he created becomes apparent. He bought a small 70’s built condo about 10 years ago. By 2007 he was able to put about $250,000 in his pocket via cash-out refinances. Shortly after putting the biggest loan possible on the property he stopped making payments to everybody––the bank, the Homeowner’s Association that was in the midst of a major (and costly) renovation project, the County (the State), and God only knows who else (little guys often get stiffed by these people). All the while he kept renting the property and generating revenue. Ultimately he gets foreclosed on. So now the bank pays him to remove his personal items and legally abandon the property. Today, we have the property in escrow and my calculations are the bank will lose about another $250,000 by the time they pay off the HOA liens, the taxes and other expenses to liquidate the property. So one little condo puts a $250k in cash in his pocket and the bank will realize about $500K in total loss. Oh, and this bank got bailout money from the Feds. And if that doesn’t put Bugs the Weasel on my poop list, he starts claiming (after he gets his move-out check and signs away his rights) that a couple of Home Depot light fixtures (that were attached to the property) have “sentimental value” and we “stole” them from him. He thinks this is so important that it warrants regular, whiny voice mail messages. Then he tells me that he wants to “pick them up while he’s up in Mammoth skiing next weekend” and that if I don’t he’s going to file a police report. He was “greatly offended” when I called him a Weasel. Man, this is a great country. And we wonder why we’re in such deep doo doo.

Well Mammoth has officially been dumped on. We now have a base of 64-100" and lots of powder!! There are many nice places to stay and if want to look around at some real estate while you are here give us a call! If you are an agent with clients looking in Mammoth-send them our way and get a referral fee. Visit our website today for lots of local info and listings in Mammoth. Go to www.mammothsoldsisters.com

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Q: So Paul, does everybody, including us, think they can pick the bottom of the real estate market in Mammoth? We think that with all of the information now available on the Internet, including your blog, we will be able to do that. But c’mon, what’s your best take on when the bottom will be and can we time it perfectly?

A: In the last few months the questions and comments about “the bottom” have become more frequent and more entertaining. Many owners or wish-to-be sellers are in the
“we’re there-we’re there, or…we’re close, aren’t we?” state of mind. Or they’re convinced that the start of regular air service (Dec. 18) will be the bottom. Meanwhile, bottom feeding buyers are trying to predict the specific quarter, like “2^nd quarter 2010, 2013” or based on some other event such as, ”when Starwood sells to Vail” or “when Main St. is redeveloped” or…(well, I’ll save that for later). At least the bottom feeders aren’t talking about earthquakes, volcanoes and hantavirus. The only thing I know for sure is that we’re heading towards the bottom. I know, genius of me to have that figured out.

Everybody wants to predict the bottom of every market. But cycles are never perfectly predictable. This picking the bottom stuff (at least here in Mammoth) is more psychological than financial. In fact, I’ve had people get upset with me because I would not proclaim “the bottom” or predict its soon arrival. Read any good financial book and you’ll discover that you’re lucky if you bat .500 at anything. Your odds of getting perfect skiing are about the same, but that doesn’t stop most people, especially not fanatics.

The one thing most people don’t realize about “bottoms” (or tops for that matter) is that you don’t know you were there until months, or years, after they occurred. No algorithm or statistical modeling will help, especially in Mammoth where emotion and “life’s clock” are such huge drivers in the market. True bottoms can only be seen in the rear view mirror. And losing your youthfulness, or squandering the opportunity for precious years with your children and grandchildren, while waiting for some “bottom” no longer makes any sense for most.

My regular readers will know there are far more important concepts to consider than nailing the absolute bottom. First, they know I watch the foreclosure market intensely because that will prove to be the best barometer of the market for a multitude of reasons (previously discussed ad nauseam). But secondly, they know that hitting the bottom isn’t as important as purchasing a quality property, and this type of market provides the buyer the patience to do that. Back in the goldilocks market I would gasp when sales would come through the MLS and people were buying dog-meat properties for high prices. The 80’s and 90’s taught us there were locations that simply didn’t resell when the market got soft. When the market got hot there wasn’t much discretion. Non-discerning agents and their buyers had little insight, and after all, real estate only goes up. In today’s market buyers should simply get screaming deals or great properties. Preferably both, but buying an outstanding property is far more important in the long run.

The third thing my readers know I watch closely is the inventory. The total inventory is really so small that it is relatively easy to watch. (I have found that many potential buyers know the inventory better than many local agents.) Right now there is a growing number of wait and hold sellers/owners. Personal knowledge and the files on my desk show this. The inventory also reflects it. Many listings expire and don’t reappear. Mammoth really has an unknown supply of sellers. Most of these people aren’t necessarily delusional, they just fall into the “don’t have to sell” category, and most likely there is great emotion tied to the property. (Adult children who rarely come to Mammoth seem to have a strong influence over their parents when it comes to selling “the Mammoth cabin”.) Others are just waiting for the “adjusted basis”. And many that didn’t sell in the past year are now happy they didn’t because they likely would have put those proceeds into mutual funds. So much for batting .500.

On the other side of the pendulum swing, some of the current listings and “short sales” are going to end up as foreclosures. And some heading to foreclosure aren’t listed, they aren’t even going to try to sell. (And pay attention, banks are getting hungry for cash.) But overall the inventory is remaining stable, there are no staggering or alarming numbers. A good percentage of that inventory would probably sell if the prices were cut by another 10-30%.

The other thing about real estate bottoms is that they aren’t “V” shaped bottoms, they are “U” shaped bottoms. And with all the wonderful economic news out there today, I would expect the U to be rather wide. That is unless some black swans come to the party. But what that really means to me is that this bottom period that we are in, or are about to enter, or is somewhere in our future, will be a period for buyers to make quality purchases in the local marketplace. And please don’t come looking for “cash flow”.

One thing I’m also observing, and should remain so, is that not all segments of the market will bottom at the same time. For instance, the values in the condo hotel segment of the market have declined substantially off of the peak(s) (the rear view mirror is a little fuzzy). I’m seeing numbers (recent sales) off as high, or greater, than 50%. There are buyers at these discounted prices, but I think there will be some additional minor declines in value, especially in the less than best locations. It all depends on how strong the winter rental income is and how many more foreclosures we will see in the next 12 months––and there are some in the pipeline. On the other hand the single-family home market between $700K and $1M remains stubborn. If the sellers cut their prices by 50% off the peak in this segment the inventory would vanish in a few days. Foreclosures aren’t impacting this segment of the market. Decent homes in the $500K range sell quickly. We may see the bottom of that segment in the next 12 months. But would could be close now. Not all segments are created equal.

Buying an excellent piece of real estate to share with family and friends should be more satisfying to the ego than being able to brag about buying at the bottom for dirt-cheap. Based on the emails and calls I receive, more and more people are beginning to think this way and are spending the time to educate themselves. There are still plenty of people that want to own in Mammoth, maybe more than real sellers. These buyers still have cash and good credit, and there are simple reasons why they do. Now if they can just get that perfect property and time the pricing bottom too. Just don’t ask me how to do that. As for the bottoms of our skis, I’m still amazed at how the crews on the Mountain can make such good skiing with such little snow. Enjoy! And Happy Thanksgiving!<!--EndFragment-->