Strong Real Estate Activity, But No Snow In The Forecast!!

Market Summary: September 24 – October 22

This report is for the past four weeks. The  Mammoth Lakes MLS is reporting 59 real estate closings in Mammoth for the period ranging from a low
of $118,000 to a high of $3,160,000. Of the 59 closings, 53 were financeable properties and 39 were conventionally financed. Thirty-one (31) of the 59 sales were condos selling under $400,000. There was one REO closing. For the same four week period last year there were 44 closings. This is traditionally the busiest selling season for Mammoth real estate — “the anticipation of winter” as I like to call it. The threat of higher interest rates has some buyers motivated but others are clearly hyped on the Ski Area’s new ownership and the potential for greater prosperity. Sales volume may very well be higher if there was just a little more inventory for buyers to choose from.

Condominium Inventory

At the period’s end the condominium inventory is down 14 to 51. There were 32 new condo listings in the period and 16 are already under contract and in escrow. Some of the new condo listing have some real “fishing” prices. We’ll see if the market supports these new prices. There are now only three (3) condos listed under $339,000 and they are brand new to the market and won’t last long. This time last year there were 129 condos on the market. The past 12 months have brought an impressive change to the Mammoth condo market.

Single Family Inventory

The inventory of single-family homes is down eight (8) to 40. There are now only five (5) homes listed under $600,000. Interesting that they haven’t sold. The sale of two multi-million dollar homes may indicate the high-end may finally pop. This time last year there were 61 homes on the market.

Pending Transactions

The total number of properties in “pending” (under contract) in Mammoth Lakes is down 13 to 67 at period’s end.  Of the 67 properties in “pending,” there are 51 in “Active Under Contract” status (formerly “back-up”).  The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is up six (6) to 117. 

Market Updates and News

This is a four week report. I was here for most of the period but had an annual fishing trip scheduled right in the middle. It was nice to get a break in the activity. Appropriately, the highlight of the fishing trip was watching our trophy tuna being devoured by multiple great white sharks. The local real estate market is getting devoured too. Many potential buyers are somewhat perplexed; wait for better inventory at what is likely to be higher prices or grab a compromised property at today’s value??
And there still hasn’t been any Ski Area derived hoopla. The biggest news so far is that the Chair 13/14 Outpost will now be featuring a variety of chi-chi grilled cheese sandwiches instead of BBQ. That and a beer sounds great, but at $25??
Mammoth has experienced a beautiful early autumn with a rather quick turning of the fall colors and a variety of warm, pleasant days mixed with cooler temps. Most of the snows stakes are in place and the irrigation systems winterized. There is still plenty of work needed to be completed; new roofs in variety of places, the sidewalk/retaining wall project on upper Main St., significant repairs remaining from last winter, and plenty of foundations that are now just coming out of the ground. The new Grocery Outlet project on Old Mammoth Road is in the final stages of grading. The reasonably good weather in the forecast may give them the opportunity to get the foundation poured before it gets buried in snow.  
Spending some time away from Mammoth always helps me get some perspective. I spent time pondering What Matters??? at this point. The Ski Area’s new ownership is likely to be less profound then most think, especially for those who haven’t been down this road before. Reflecting on the sales in 1996 (Intrawest) and 2005 (Starwood Capital) the sales and periods were very different. My take-away is that the national and State economies influence what happens here in Mammoth more significantly than who or what owns the Ski Area. And those forecasts are a mixed bag.
And I’m beginning to ask myself why Mammoth would be on any priority list for the new KSL/Aspen ownership. Is Rusty’s $100M really on the list?? Or is the Main Lodge exchange expense part of that?? We’ve heard these garbled messages before. And we’ve heard the “greatest opportunity” lines before. The reality is that because of the location, demographics and quality of the skiing, the enterprise can muddle through and still pull-down excellent financial numbers here in Mammoth. While many of us see the place as somewhat broken, the corporate honchos may not. And if it ain’t broke, why fix it? And real estate values have to still come a long way before a solid development cycle occurs. So far, there is no magic, only hollow hyperbole.
​​​​​​​So what does matter?? The Town’s coffers are in very good shape. But how that money is allocated in the near future is critical. It isn’t for wasting. We have three Town Council seats up for election in June. And I’m hearing an impressive amount of discussion amongst the town’s people about who and what is right for our future. Housing for local residents, and residents that are critical for a functioning community (middle income housing), is moving into a priority position. And unlike the bulk of second homeowners, these are voters. The future occupants of the three TC seats are likely to be the ones who are moving to resolve the housing crisis with the Town’s wealth instead of a $15M ice rink (which still does not have the full go-ahead).
And many in the community believe we are simply spending way too much on marketing. While those efforts have produced incredible bed tax generation for the Town, the law of diminishing returns may have been exceeded and the money is needed somewhere else. This too is likely to be a heated election debate. 
​​​​​​​The wildfires in northern California are a warning about that potential here in Mammoth. But in the past 10+ years a great deal of the threat has been addressed by the local agencies. They have been aggressive about creating fire breaks in critical locations around town. We have witnessed significant thinning and management. All the way down to the Village. We have also witnessed the incredible response by the various agencies to any threats. The massive fire crews and air support show up almost instantaneously. We are lucky.
And what else matters?? It needs to snow.
Meanwhile, ongoing presentations about the Main St. revitalization remain unrealistic to the local economy. The proponents seem to think we really do have the “giant eraser” and endless financing to construct a brand new downtown. None of them seem to have any clue about Eldon Beck’s “processional effect” which makes downtowns and villages interesting and vital. The short sightedness is incredible. It has almost become a waste of time to even bother listening. The Grocery Outlet people wouldn’t have anything to do with it. The Town even thinks they could offer pre-approved cookie-cutter buildings for the property owners. They don’t like the 70’s funk but they want the downtown to look like tract homes. Can it get more absurd?? 
The condo remodeling boom continues on strong. Today’s buyers either have to purchase one that is already substantially remodeled or make plans to do their own. Local contractors are booked through the winter so next spring will be the first opportunity. The positive aspect about this is the owner will get to “experience” their new properties before making critical (and expensive) decisions. I was talking to a local contractor just the other day who has 30 years of remodeling experience in Mammoth; he was tearing out a kitchen that he installed just five years ago. There was nothing wrong, the owner just wanted something different. They probably realized that could have made better design choices. And one of the great opportunities is to see what other owners of similar units have done — plenty of good ideas.
Mammoth continues to have fruitful discussions with Inyo County over airport improvements at Bishop Airport. The airport basically has three runways (post military era) that can accommodate any type of aircraft. It is “flyable” almost every day of the year. It has long been sought for a back-up to Mammoth but the Bishop folks have resisted. That has now changed. The FAA is offering grants to improve electronics and security. Mammoth is offering to help make maintenance subsidies. This could be a major step in solidifying Mammoth’s air service reliability.

Noteworthy Sales

With all these condo sales under $400,000 there are rising prices to be seen everywhere. Included are 1-bedroom sales at Snowcreek II, Viewpoint, and The Summit all pushing right to the $300,000 mark. Wow. And significantly higher closing prices at Bigwood, Discovery Four, Horizons Four, Aspen Creek, Timberline, Sherwin Villas, Tosca, Hidden Valley, St. Moritz, and San Sierra.
Two Westin Studios closed for $248,000 and $249,000. Both lower floors and ho-hum locations. Prices are up.
​​​​​​​A total of 12 Snowcreek properties sold including two 2/2 “flat” units in Phase V and four 2 + loft units in Phase I and II. All at rising prices.
The two SilverBear 2 bedroom units that have been on the market seemingly forever both closed; at $390,000 and $391,000.
The three sales at Sherwin Villas are all lofted units with stair accesses that may be problematic under the new transient occupancy regulations pertaining to lofts. I hope all of that was disclosed. 
​​​​​​​The high sale for the period ($3,160,000) is a 6800 square foot Rosaasen built home on one of the premier lots in the Bluffs subdivision. Super quality construction in excellent condition. Purchased way below replacement value.

Favorite New Listing For The Period!

TimberRidge is a quirky project in Mammoth Lakes. It sits at the highest elevation of any private property in town and looks down at Canyon Lodge. It is one of the true ski-in and ski-out condo projects but it can be challenging to do so under certain conditions. It can also be difficult to access in snowstorms. The project is also known to have spectacular views. 
   Many years ago the owners started replacing the dining room and living room windows with steel frames and floor-to-ceiling windows. The effect on the north side of the project is quite dramatic. You feel like you are in the tree tops. So here is a new listing that has those dramatic windows and views. This is a 2 bedroom / 2.25 bath / 1-car garage unit that also happens to be an REO (bank owned) and is being sold fully furnished. Ready to use now, and remodel later.
​​​​​​​Listed at $439,900​​​​​​​

Other Real Estate News

The Board at the California Association of Realtors® (CAR) recently made a bold move by approving a $100 surcharge to every agent in California for 2018. The money will be specifically allocated to proceed with establishing a State ballot measure for the November 2018 election. That measure will address the “portability” of property taxes for homeowners over the age of 55; allowing them to transfer their property tax basis from their current primary residence to a new primary residence within California. And as many times as they desire. The new tax basis would be calculated via a formula.
This style of property tax portability already exists in some counties within California. But the “new” county has to a “reciprocal” county (like Orange County). Not all counties are reciprocal. Mono County (Mammoth) is not. There are currently only 11 reciprocal counties in California. And this only works if the replacement property is equal to or less than in value.
But the new proposal/legislation will allow owners to move up in value and only add the difference in the property tax basis from old to new. A downward calculation is also proposed if the owner buys a replacement of lesser value.
The Realtor arguments in favor of the proposed legislation are; there should be no moving penalty for seniors, AND it would create new housing opportunities for the younger generations that in theory should increase the local tax base.
This was just voted on last week. More information will be coming. There will be push-back from the membership over the $100 (they are shortsidedly cheap). There is destined to be push-back from the State Board of Equalization. It is shall be a interesting referendum. I expect some nut-case arguments too.
My initial impression; I’m surprised that CAR wants to allocate major resources to this. I am fine with the proposed legislation (especially now that I can qualify as a “senior”….lol). But I personally believe there is a much bigger fight coming; the attempted repeal of Proposition 13 in its entirety. This proposed legislation would disappear if that happens and the effort will be wasted. Obviously, CAR doesn’t think Prop. 13 is in potential danger. We’ll see.
Thanks for reading!

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