The following is taken from en email sent to me yesterday by Margot Zen at Diversified Mortgage here in Mammoth Lakes. She is one of the few lenders I recommend to my buyers because she and her staff work quickly, are very knowledgable and communicate well with my clients:
"I wanted to update you on some pending federal legislation that could have a HUGE positive impact for us who do business in more expensive areas. The federal government has put together an "Economic Stimulation Package." It has already passed the House and is on its way to the Senate. One of the areas that I am most excited about is they are proposing to raise the CONFORMING loan amount for high cost areas, such as ours, to above the current $417,000 limit.
They are proposing to increase that limit for a 12 month period to as high as $750,000. What does this mean to us?
It means our clients who are on the fence about purchasing property where they need a loan above the $417,000 limit will be able to get a loan at a much more affordable rate. (The difference between the interest rate on a conforming and a jumbo loan today are 5.48% vs 6.71%, which is a pretty big difference). If this passes the senate, we could see it go into affect as soon as mid February."
As an example of the effect this may have, let's hypothetically 'buy' a 2bd/2bath ski-in/ski-out condo at the Bridges for $700,000 (there is one on the market for $749,000). With a 10% down payment and a Jumbo loan at the rates Margot mentions (6.71%), the monthly payments would be $4,069. If the loan were instead considered conforming and rates were only 5.48%, the monthly payments would drop to $3,569, a savings of $500/month (or $6,000 per year).
It will be interesting to see if buyer activity increases if/when the conforming limits are raised. And, of course, refinance activity should increase from current owners with loan amounts between $417,000 and $750,000.
Sellers better not raise their prices artificially to take advantage of this demand-side advantage. I also predict that the spread will not be as much if/when the limits are raised. As my grandfather once said, "Nothing is ever as good or as bad as they first seem."
Margot can be emailed at margotzen@dmortgage.biz.
Saturday, January 26, 2008
Sunday, January 20, 2008
The Night of Lights makes an explosive return to Mammoth!
If you weren’t able to attend last week’s Night of Lights here at Mammoth Mountain, California, then you’d better make sure and put it on your calendar for next year! The event was resurrected from its last showing over 10 years ago and relocated to Canyon Lodge in order to provide easier access to any and all that were interested. Adults, children and babies alike were able to access Canyon from all avenues including the Village Gondola, the bus system and just taking a short walk from their home or car. I think it’s safe to say it was a huge success!
It was truly an incredible evening! It began with an amazing Snowmobile demo show featuring X-games athletes pulling off full 360 degree back flips like they were nothing! The
crowd exploded with applause, hoots and hollers after each amazing stunt. After the demo was complete, the torch light parade began with Chairs 8, 16 and 22 being lit up in red flares. Then the succession of torch carriers inched down the mountain, finally forming a large “M” for all to see. Mother Nature cooperated by providing a bright crescent moon that just happened to line up perfectly over Lincoln Mountain and Chair 22. Then the fireworks began! It was definitely the most incredibly choreographed fireworks show that I’ve ever seen with music including the songs of U2, Pink Floyd and Aerosmith, just to name a few. Most definitely a night to remember!
Were you there?? Let us know what you think.
-TLP
It was truly an incredible evening! It began with an amazing Snowmobile demo show featuring X-games athletes pulling off full 360 degree back flips like they were nothing! The
crowd exploded with applause, hoots and hollers after each amazing stunt. After the demo was complete, the torch light parade began with Chairs 8, 16 and 22 being lit up in red flares. Then the succession of torch carriers inched down the mountain, finally forming a large “M” for all to see. Mother Nature cooperated by providing a bright crescent moon that just happened to line up perfectly over Lincoln Mountain and Chair 22. Then the fireworks began! It was definitely the most incredibly choreographed fireworks show that I’ve ever seen with music including the songs of U2, Pink Floyd and Aerosmith, just to name a few. Most definitely a night to remember!Were you there?? Let us know what you think.
-TLP
Wednesday, January 16, 2008
Mammoth Real Estate Inventory drops overnight
From December 31st, 2007 to January 1st, 2008 the Mammoth real estate inventory dropped 11% overnight! There were 474 condos, homes, lots and commercial listings in Mammoth Lakes, CA, at the end of 2007 and only 422 the next day.
What happened was that many listings were set to expire on 12-31-07 and they have not been renewed (I was waiting to see if any had been relisted, but as of today we still have only 424 listings). And this decrease was not a result of a buying spree over New Year's. The only other time in the last 5 New Year's Eves that this has happened was '04/'05 when inventory dropped 8% but climbed back up within one month.
What this is doing is weeding out the non-committed sellers; "Oh well, my condo didn't sell, so we'll just let it expire and wait until the market gets better." This will help simplify choices for buyers.
The chart above include what I like to call the pink stale market indicator line. Hot markets usually clear out inventory and slow markets have lots of inventory that sit on the market for a long time. This quick clearing of some of our inventory may help quicken things up. BUT the whole credit crunch phenomenon is a new dynamic that has shrunk the pool of prospective buyers this time around. Sellers need to know that their target market has dwindled because buyers' lenders are requiring more documentation of income and more money down (i.e. 40% down payment for the new Westin Monache!)
The good news for sellers is that there is recent evidence of pent-up demand for Mammoth real estate. I listed a foreclosure (see MammothLakesForeclosures.com) last Friday and had 5 offers by Monday morning with 4 more on the way before the bank accepted one of the offers. An associate of mine also listed a foreclosure last week and put it into escrow on Monday. The interest generated by these two listings was encouraging. The prices were good on these listings, but they were not given away by the banks for pennies. I think these foreclosures and other recent distress sales are slowly showing sellers where their prices need to be in order to sell. Whether they heed this downward price pressure or just let their listings expire without selling is telling of just how motivated they truly are. -DC
What happened was that many listings were set to expire on 12-31-07 and they have not been renewed (I was waiting to see if any had been relisted, but as of today we still have only 424 listings). And this decrease was not a result of a buying spree over New Year's. The only other time in the last 5 New Year's Eves that this has happened was '04/'05 when inventory dropped 8% but climbed back up within one month.
What this is doing is weeding out the non-committed sellers; "Oh well, my condo didn't sell, so we'll just let it expire and wait until the market gets better." This will help simplify choices for buyers.
The chart above include what I like to call the pink stale market indicator line. Hot markets usually clear out inventory and slow markets have lots of inventory that sit on the market for a long time. This quick clearing of some of our inventory may help quicken things up. BUT the whole credit crunch phenomenon is a new dynamic that has shrunk the pool of prospective buyers this time around. Sellers need to know that their target market has dwindled because buyers' lenders are requiring more documentation of income and more money down (i.e. 40% down payment for the new Westin Monache!)The good news for sellers is that there is recent evidence of pent-up demand for Mammoth real estate. I listed a foreclosure (see MammothLakesForeclosures.com) last Friday and had 5 offers by Monday morning with 4 more on the way before the bank accepted one of the offers. An associate of mine also listed a foreclosure last week and put it into escrow on Monday. The interest generated by these two listings was encouraging. The prices were good on these listings, but they were not given away by the banks for pennies. I think these foreclosures and other recent distress sales are slowly showing sellers where their prices need to be in order to sell. Whether they heed this downward price pressure or just let their listings expire without selling is telling of just how motivated they truly are. -DC
Friday, January 11, 2008
The Ritz-Carlton is coming to Mammoth Lakes
THE RITZ-CARLTON RESIDENCES
MAMMOTH
After much anticipation and speculation as to whether or not it would happen, the Ritz-Carlton is now officially scheduled to take its place in Mammoth. Just yesterday we were presented with the initial roll-out of the extensive marketing campaign that is set to unfold over the next few months. Unlike past campaigns, which have focused primarily on Southern California, this one is supposed to be far reaching, including Dallas, TX, and Vancouver, Canada.
The Ritz-Carlton Residences will be located adjacent to the existing Westin Monache, just across from the Village gondola. All concierge and full-service amenities imaginable will be offered. Plans are in place (pending CalTrans approval) to build a pedestrian bridge over Canyon Blvd that would service both the Ritz and the Westin. With completion scheduled for the end of 2010, timing could be good in relation to anticipated air service.
We were told that floor plans will range from approximately 1,200 to over 5,000 square feet. Pricing is supposed to start at about $1,400,000 and go to over $6,000,000. This will be an entirely new level of development for Mammoth.
The “homes”, as they are to be called, will be sold using a reservation program, similar to what has been used in the past by Intrawest for all of their projects. Reservations are $10,000, fully refundable, and will be accepted starting January 30th. The actual sales date is scheduled for the end of April.
Please feel free to contact us should you like more information on THE RITZ-CARLTON RESIDENCES, MAMMOTH.
Thursday, January 3, 2008
Blizzard coming to Mammoth Lakes, CA
Blizzard Coming to Mammoth Lakes!!
There is much anticipation in town today following yesterday's announcement of a blizzard warning coming for tomorrow, Friday, January 4th. Locals are getting reverse-911 calls from the Mono County Office of Emergency Services warning that travel is not recommended, we should all have provisions to last us 72 hours, there may be power outages, and to stay tuned to the radio for weather updates.
Upon this news spreading, everyone flocked to our only grocery store, Vons. My wife went last night at 7:30pm and saw lines to the back of the store. I just went at 10:15am this morning to take these pictures:
[Bread aisle at Vons]
[Water aisle]
But good news, Vons is being re-stocked as I write this and folks are adjusting travel plans accordingly. We are preparing for cell phones and internet to be down. If you need to reach me regarding real estate, try my or my partner's email and phone (click here for the Contact Us page of our website), but if you don't get through, just wait until the storm passes on Saturday midday. Let's hope no one gets hurt and that our mountains get the 5-10 feet of snow that is predicted! Good luck to SoCal as well, with the flooding predicted and the burn areas getting soaked.
Taken from the NOAA.gov website just now, "Blizzard warning from 4 AM Friday to 10 AM Saturday...A major winter storm developing in the Pacific will reach the Sierra and western Nevada on Friday. Cold air from a low pressure system in the Gulf of Alaska will combine with a plume of subtropical moisture [the famed pineapple connection!] to produce very large snow accumulations between Friday morning and Saturday morning in the Sierra...Winds will increase to 80 to 100 MPH with gusts near 145 mph"
Those of you who own property here but who are out of town, make sure to ask your property managers to pull in any furniture from your deck/balcony. If your roof does not shed snow easily, ask your property manager if it needs to be shoveled after the storm. Be prepared for large snowdrifts to accumulate on the leeward side of buildings (usually the northeast corner, since the winds prevail from the southwest).
There is much anticipation in town today following yesterday's announcement of a blizzard warning coming for tomorrow, Friday, January 4th. Locals are getting reverse-911 calls from the Mono County Office of Emergency Services warning that travel is not recommended, we should all have provisions to last us 72 hours, there may be power outages, and to stay tuned to the radio for weather updates.
Upon this news spreading, everyone flocked to our only grocery store, Vons. My wife went last night at 7:30pm and saw lines to the back of the store. I just went at 10:15am this morning to take these pictures:
[Bread aisle at Vons]
[Water aisle]But good news, Vons is being re-stocked as I write this and folks are adjusting travel plans accordingly. We are preparing for cell phones and internet to be down. If you need to reach me regarding real estate, try my or my partner's email and phone (click here for the Contact Us page of our website), but if you don't get through, just wait until the storm passes on Saturday midday. Let's hope no one gets hurt and that our mountains get the 5-10 feet of snow that is predicted! Good luck to SoCal as well, with the flooding predicted and the burn areas getting soaked.
Taken from the NOAA.gov website just now, "Blizzard warning from 4 AM Friday to 10 AM Saturday...A major winter storm developing in the Pacific will reach the Sierra and western Nevada on Friday. Cold air from a low pressure system in the Gulf of Alaska will combine with a plume of subtropical moisture [the famed pineapple connection!] to produce very large snow accumulations between Friday morning and Saturday morning in the Sierra...Winds will increase to 80 to 100 MPH with gusts near 145 mph"
Those of you who own property here but who are out of town, make sure to ask your property managers to pull in any furniture from your deck/balcony. If your roof does not shed snow easily, ask your property manager if it needs to be shoveled after the storm. Be prepared for large snowdrifts to accumulate on the leeward side of buildings (usually the northeast corner, since the winds prevail from the southwest).