Real Estate Price and Foreclosure update

Quick Mammoth Lakes real estate update:

Condo Sales pace down by 53%
So far this year, 114 condos have sold (annualized rate of 176) vs. 374 in 2006. For homes, the pace is better with 30 selling so far this year (annualized rate of 46) vs. 55 last year.

Prices are basically the same
CONDOS: 2006 Average price = $662,000 (median $560,000)
CONDOS: 2007 Average price = $680,000 (median $546,000)

HOMES: 2006 Average price = $1,092,000 (median $895,000)
HOMES: 2007 Average price = $1,090,000 (median $905,000)

Yesterday someone called me asking for the complete list of foreclosures here. Others have called to ask how much our prices have crashed. They are surprised when I tell them there is only 1 foreclosure and that prices have not crashed.

Mob psychology is a funny thing. Most of our visitors come from Southern California and they hear about the real estate mess in their areas and assume the same thing is going on up here.
But our product is still fundamentally sound (4.5 square miles of private land surrounded by amazing natural beauty) and so are our buyers, who come in with healthy down payments or 1031 exchange money and therefore do not have crazy sub-prime loans.

Most sellers are able and willing to hold on until they get a reasonable offer or until the market improves. There are very few fire sales right now. So if you are a buyer with good credit, use a full time real estate agent (such as myself) to determine which listings are priced reasonably, buy for the long term and don't worry about the short term market fluctuations.

Good news for high-end property owners; a house in Juniper Ridge that was listed at $4.89M just went into escrow. Only two homes over $2M have sold in the last year. And a 3-bedroom at The Village just sold for $1.36M ($933/sqft)! So, nope, our market is not crashing. I think sellers are setting the tone about where they feel their properties should be valued. Unfortunately, buyers are not agreeing with them at this time.

Corporate purchase of approx. 6.5 acres in Mammoth

We in the Mamoth real estate community learned about this about two weeks ago, but this article just showed up today on Business Wire:

"Cypress Equities Acquires Hillside Property at Mammoth Lakes

DALLAS--(BUSINESS WIRE)--Cypress Equities, an affiliate of The Staubach Company, announced today they have acquired the “Hillside” property at the intersection of Lake Mary Road and Canyon Boulevard in Mammoth Lakes, Calif. Cypress Equities is currently working on a management agreement with a Five-star Hotel Operator for private, ultra-luxury residences featuring the finest in hotel amenities.

Chris Maguire, CEO of Cypress Equities, said, “We know Mammoth Lakes is not a secret - the mountain and the surrounding area makes for a phenomenal year-round resort. We also know that the real estate here in Mammoth is undervalued, so we plan on making this the ultimate destination for those who are seeking a luxurious and serene lifestyle with excellent skiing, biking, fishing and hiking.”

Currently, the “Hillside” property floor plans, sizes, amenities and services are in the design and review phase and the complete project consultant team is being assembled. A marketing campaign is expected to launch later this fall.

More information regarding the new Mammoth development will be released when the Hotel agreement is completed.

About Cypress Equities
Cypress Equities was formed in 1995 as the development affiliate of The Staubach Company. With seven development offices in Dallas, Atlanta, New York, Phoenix, San Francisco, Fort Lauderdale and Nassau, Bahamas, it is an independent company with a dedicated staff that focuses on portfolio acquisitions, build-to-suits, project development, sale-leasebacks and other development services for retail, automotive, hotel and resort property. Cypress Equities is currently developing over $3 billion in projects across the country. "

We like to hear the part about Mammoth real estate being undervalued, but be wary of this as a marketing ploy to try and hype up Mammoth to justify the price they just paid for the land. Hope they researched our town's development impact fees and housing mitigation ordinance.

Here is a Google Earth image of the approx. 6.5 acre parcel that Cypress Equities has purchased for an unconfirmed $53,000,000:

The parcel is adjacent to the Westin "Monache" and across the street from the Village gondola.

And yes, Cypress Equities is an affiliate of The Staubach Company... as in Roger Staubach (http://www.staubach.com/). I'm pretty happy to own a rental condo right across the street at Hidden Valley, hoping that values can only rise with this news. And while the construction right at our condo entrance should put a damper on things for a few years, there is talk of putting in a traffic circle nearby at Lake Mary Rd and Canyon Blvd.

Early August update

Just waiting for our 2nd daughter to be born. Due date was Aug 13th, which would have been cool to have our 2 daughters exactly 18 months apart, but that came and went and we are left trying to decide to either wait and run the chance of another big baby (our first daughter was 9 lbs 9.5 oz) or induce by any of a number of methods. The one they tried last night didn't work, so we're back home and will try again tonight.

But we get to experience the brand new wing at the Mammoth Hospital. The facilities are very nice and the nurses love their new ward. But what we heard about the hospital running out of money seems true, as TVs are missing from all of the labor & delivery rooms. Regardless, the rooms are nice and big and the care given to us by our small town hospital is outstanding. It's funny when asked so often, 'so are you having the baby down in Bishop?' Many out of towners don't realize that Mammoth even has a hospital! You got to when so many snowboarders are breaking wrists in the winter (like I did back in '99 here) and when so many elderly get altitude sickness in the summer.

I overheard a Vons manager saying that last week was their best week of the summer. That confirmed our feelings what with all the 'traffic' and such. The Bluesapalooza event had cars parked on both sides of the entire length of Minaret Blvd from Meridian to Main Street. The opening night was one of those times when Mammoth gets overbooked. The local Mammoth Lakes Theatre Company was in action doing a small play and the Felici Trio also had their closing concert. I opted for the latter as I had a free ticket and joined the standing room-only crowd in applauding the musicians who again played flawlessly.

And because of my wife's pregnancy, I had to miss the entire week's worth of concerts and events surrounding the 30th Sierra Summer Festival. I felt cheated as I put in month's of work lining up housing for 70 musicians and didn't even get to hear them perform, let alone perform with them as I usually do. Next year...

In addition to the music events, high school running groups have been swarming all over town. It's so great to see them training together in groups, exploring all of our trails. I even got to compete against them in the Footloose/Charthouse 5k/10k last weekend. I ran the 5k in 20:40, just fast enough to take 1st in my age group, showing you the lack of competition in my age group! Pancakes and coffee right afterwards were the true reward.

Real estate wise, things are still very slow. Buyers and sellers are still staring each other down, waiting for one to blink. The most recent offer I wrote up ended up expiring as my buyer decided to wait a while to see if the seller becomes more motivated. Yesterday I told a condo owner who was thinking of selling to wait half a year and reassess; he didn't really need to sell. Just enjoy Mammoth right now and wait for conditions to improve.

Enjoy the last few weeks of summer!