Massive Fourth of July Week, And Then Mammoth Mellows Out!
Market Summary: July 2 – July 16
The Mammoth Lakes MLS is reporting 23 real estate closings in Mammoth for the period ranging from a low of $170,000 to a high of $1,099,000. Of the 23 closings, 21 were financeable properties and 15 were conventionally financed. Ten of the 23 sales were condos selling under $380,000 and add four (4) residential properties selling over $800,000. The 10-year Treasury and mortgage rates both ticked upward during the period. This period last year there were nine (9) closings.
At the period’s end the condominium inventory is up seven (7) to 82. There were 21 new condo listings in the period and 10 are already under contract and in escrow. The least expensive condo is listed at $225,000 but there were a couple of less expensive condos that came to the market, but they have already sold. There are still only nine (9) condos listed under $325,000. Most new listings continue to have significantly higher asking prices but not all. Low appraisals continue to be an issue — and now some buyers are backing out of contracts on that basis. A small build in inventory and slightly slower sales activity might once-again bring the best condo buying opportunities in late summer. There are some. This time last year there were 170 condos on the market, two years ago 213.
Single Family Inventory
The inventory of single-family homes is up 10 to 50. There are now six (6) homes listed under $600,000 but that still isn’t purchasing much. There are some decent new listings in the price points above that. There are also some new listings that faired the past winter but it appears the owners are “over” dealing with these properties under extreme conditions. This time last year there were 73 homes on the market.
The total number of properties in “pending” (under contract) in Mammoth Lakes is down 11 to 59 at period’s end. Of the 59 properties in “pending,” there are 47 in “Active Under Contract” status (formerly “back-up”) and one Contingent Short Sale. The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is down 12 at 92. This time last year it was 57 and 100 respectively. The recently heated real estate market driven by the big winter and the announced Ski Area merger has clearly slowed down.
Market Updates and News
Despite the slowdown, local appraisers are taxed and quoting 3 to 4 week turn-arounds for new appraisals. I had a long conversation with one just the other day and he definitely sounded stressed. But for now it appears we have settled back into a “normal” summer selling cycle. The frenetic stream of leads has slowed down. I expect the inventory to build slightly in the condo and single family segments. The low-end will continue to see pressure but we’ll see how long it takes for some price reductions to come through. The late summer and fall will be interesting. The “anticipation of winter” always changes this market.
The extreme run-off continues but the high country is becoming increasingly accessible. I’m glad the real estate frenzy has slowed for now. The coming months will be fabulous for local hiking. The Fourth of July crowd was massive but the subsequent weekends have been quite uncrowded and very pleasant. The string of summer “events” that marry music, food and alcohol begins and tourism will certainly increase. And hotter weather will drive people to the high country. Electric bikes are becoming wildly popular. People are riding them every where, including lots of people who don’t look like they’ve ridden a bike in a long time. Everybody needs to pay attention.
A significant part of the Mammoth real estate market is being driven by short term rental income production. The Airbnb / VRBO phenomenon continues. Many buyers are purchasing with huge expectations (their agents told them so). It may have slowed for now, but I certainly expect the frenzy to continue through the next year. Especially if we get some positive news out of the Ski Area merger deal and eventually snow. But for now we’ll take the perfect summer weather.
One interesting sidebar; The Magnolia Lodge property was developed in the mid-2000s. It is a luxury, large four-unit condominium project in the very north west corner of the Village. It was originally restricted (by the developer) from short term rentals. The restrictions ultimately made very little sense. The Village is about rental and convenience, not peace and quiet. Within the last few months, 3 of the 4 units have been on the market. They have been poor resellers. But the HOA recently voted to eliminate the rental restrictions. Now these units have the potential to be rental monsters — like renting a lovely home right in the Village. It will be interesting to see the rental success and appreciation in the years to come. And the Town is grateful to have new bed tax generators that certainly have the potential to generate $10-15,000 in annual bed tax alone.
The Town Council has approved the grading contract for the Mammoth Creek Park West Ice Rink project. The work is scheduled to begin after Labor Day. The final construction cost estimates will be in by then and many in the community believe the cost will be in the neighborhood of $15M. We’ll see. Nothing is cheap to build here in Mammoth Lakes. And the local HOAs are still arguing that the Ice Rink/MUF project is not in conformance with the Town’s General Plan. Litigation is still a possibility.
Meanwhile there is a really odd and nearly hypocritical direction by the local governments. Mammoth Lakes Housing is actively pursuing vacant office and commercial space in town to convert to affordable housing (housing is at a crisis stage in Mammoth; there is a good letter on the subject in this week’s issue of The Sheet from long-time Mammoth Councilman Kirk Stapp). The first conversion project is moving forward at the Mammoth Mall (behind the old Charthouse). Vacant office space is in the process of being converted to housing. MLH is looking at others.
So at the same time that we have a glut of underutilized commercial space, the County and Town are looking at developing new office space for County and Town administrators. We’re talking a $20-40M project on the property next to the new courthouse. And one question I hear more frequently; if there is plenty of business in town but we don’t have any employees because of a housing shortage, shouldn’t we spend the millions on solving housing rather than building a fancy ice rink?? No one really seems to have an answer.
The Forest Service is looking for comments to the Draft Environmental Impact Statement. The site makes it very easy to make comment but finding the specific DEIS is difficult or missing. Regardless, readers should take the time to make comment. I’m still a big believer that the gondola system should be completed as a condition of the exchange. Every property owner and lift ticket purchaser would benefit.
And while Airbnb already has a “Select” portfolio it appears that they are going to raise the bar even higher with Airbnb Lux. The goal is to compete with high end hotels. The rumor is that it will include “mansions, penthouses, and other abodes of the truly affluent.” They have already acquired Canadian company Luxury Retreats that specializes in upscale villas…..I’m wondering what kind of qualifications I’ll need in order to rent one of these properties….
What a difference a year makes… a home in the Slopes that has been on the market the past few summers (after being rented during the winter) finally sold for $578,000. I’ve spent considerable time in the property the last few years and it is really a “complete gut.” Even worse, it has a downstairs living floor plan which is traditionally not the most favored in this environment…. And another house on John Muir Trail sold for $550,000….How did they get a loan??
And more buyers chasing nightly rental income; the high sale of the period was a home (B&B??) that sits (a rarity) in a zone that allows transient rentals. But paying $1.1M for a home located next to mobile homes and across from substandard apartments?? Not exactly a “resort” location. This property has also been on-and-off the market over the past few years….Good luck.
Meanwhile a nicely remodeled 3/3/1 town home in Snowcreek 5 sold for $650,000. That makes sense. Nice views too!
Speaking of Snowcreek, the phase I and II 2 bedroom +loft / 2 bath town homes have been selling briskly already. Last summer they sat and sat. But this year they are selling quick. Maybe it is because the Meadow looks so awesome after the big winter!
Two low-end listings came on at Snowcreek II and Horizons Four that represented major upward moves in pricing. Both have already gone to escrow. While other good buys are sitting.
A residential vacant lot in the Slopes closed for $170,000. These continue to become increasingly scarce.
Favorite New Listing For The Period!!
This is one of those properties that when you walk into it you just say “Yes.” This is the 2B floor plan at Creekhouse (aka Snowcreek 7). This specific unit is like brand new (built in 2014). It is sold furnished including some wall decor. It is beautiful. The location is right over the Mammoth Creek drainage and Meadow area. It has expan
This floor plan is 3 bedrooms and 3.5 bathrooms (2251 square feet) and a nice 2-car garage. The formal entry and garage entry both enter the main level where the kitchen, dining, and living room are. There is excellent utility here including a powder room. The formal entry is covered and adjacent to a large covered deck overlooking the green belt — a perfect place for hanging out. There are three more covered decks all facing the green belt; each bedroom has its own private deck. There is good separation in the downstairs bedrooms for privacy. This is a unique and lovely floor plan in an incredible location.
Listed at $948,000
Listing courtesy of Kathleen Richardson, Mammoth Village Realty
Other Real Estate News
The California State Senate recently passed Senate Bill which would add a $75 fee to recordings like real estate transactions and refinances. The monies would go towards state housing subsidies. The Bill now goes to the Assembly where it needs two-thirds approval, but that is expected. And I certainly would expect Governor Brown to approve. Or maybe he would disapprove thinking that the amount should be increased.
The new fee is estimated to provide $250 million in new funding for low-income housing developments. An additional Bill that passed the Senate included a $3 billion bond for low-income housing. If it all passes, let’s hope some of that money ends up in Mammoth…
Planing consultants were in town and meeting with public officials and business owners looking at the Main Revitalization program known as “Walk, Bike, Ride.” But the takeaway is that it is all more pie-in-the-sky dreaming with no short term impact. My readers know that I see the program as a thousand baby steps.
For instance, Salsa’s taco shop on the corner of Chateau and Old Mammoth is right across the street from my office. I can see it all day long. Several months ago two local and long time cooks in town took the place over. One thing they did was put six heavy duty table/bench combinations out front with nice Coca Cola umbrellas. Now there are people there eating constantly; groups, families. etc. Business is clearly up. The tables and umbrellas made the place stand out. And their customers are migrating over to Mimi’s Cookie Bar next door. The customers are enjoying it. It is a successful baby step.
I recently came across a planning article that explained the distortion Mammoth has with the Main St. Plan. The writer (planner) refers to a “male/female” approach to economic development. The male approach (like an ex-footbal player would have??) is to bulldoze everything and start over; “valuing big, valuing new, valuing the deal.” The opposite is the female approach; taking “eclectic, local, one-of-a-kind commercial places” and improve what is already there. And to not only improve but to “embrace and leverage that is there to ratchet up economic performance and brand.” It is about cultivation not replacement.
The male approach (scrap and replace) requires out-of-town development dollars and national chains. The female approach fertilizes what exists, keeps it affordable for local ownership, and fosters local wealth creation. And I might add makes it far more interesting for both visitors and local residents. It makes it authentic.
The female or “improve what you have” approach requires that the Town planners have a new toolkit. We’ve already forsaken the sign ordinance that was created 25 years ago. And true redevelopment is far too expensive. The toolkit needs to be Mammoth specific. So rather than hiring dreamy consultants at $100K apiece that take us no where, Mammoth needs a new tool kit consultant. If a couple of enterprising cooks can figure it out, maybe the Town can figure it out too.