More Fantastic Weather, More Crowds, And More Frustrated Buyers!
Market Summary – November 14 to November 28
The Mammoth Lakes MLS is reporting 14 real estate closings for the period ranging from a low of $340,000 to a high of $2,100,000. Of the 14 closings 13 were financeable properties and nine (9) were financed closings. The closings included three (3) brand new Obsidian Villas units. These units were put under contract in the summer of 2020 and closed in the $460-470 per square foot range. Patience paid off for these buyers because the market has gone parabolic since the agreements were originally signed. This period last year there were 19 closings.
The 10-year Treasury yield ended down to 1.482% but it was much higher during the period. The mortgage industry blamed the new Covid variant ruckus of Friday for the drop in yields. Many markets moved on the news and it will all be sorted through in the coming week(s). The mortgage rate trend has been ticking up slowly and is expected to continue. But how high they will go is anybody’s guess. One mortgage related tidbit from the period; “Almost 40 percent of the loans Fannie Mae purchased in August received appraisal waivers”……Appraisal waivers and “desktop appraisals” may become the norm in 2022. Maybe negative amortization loans will make a comeback too.
At the period’s end the condominium inventory is down five (5) to 10. Absurd. And two (2) of the 10 are deed restricted units that have lingered on the market. These deed restrictions mean they are only available for purchase by local employees with certain income levels. Quite frankly, with the ongoing affordable housing crisis in Mammoth it is surprising somebody hasn’t purchased them. Or that Mammoth Hospital or the Water District hasn’t ushered some employees into them. The units aren’t perfect but more than livable. Beats living in the forest. This period last year there were 28 condos on the market.
There were nine (9) new condo listings brought to the market in the period and five (5) are already in escrow. New pricing is all over the place. Higher quality properties are selling for high prices. Lesser quality properties with reasonable pricing are selling. Some listings are sitting. Odds are a handful of the existing listings will go to escrow after this busy weekend.
Single-Family Home Inventory
The inventory of single-family homes is down two (2) to 15. There are four (4) homes listed under $1M. This time last year there were 21 homes on the market.
The total number of properties in “pending” (under contract) in Mammoth Lakes is up one (1) to 74 at period’s end. Surprising considering the low inventory and people are moving quickly into holiday mode. The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is up one (1) to 114. This time last year the numbers were 97 and 128 respectively. The market conditions are creating a “breather” for the local real estate industry. I’m sure everybody is welcoming it. I am.
Market Updates and News
From an old-time perspective, skiing was never guaranteed at the Thanksgiving period (it is now a week+ holiday period rather than a four day weekend). But in this era of IKON passes and snowmaking it is expected, and it isn’t always great. The recent and lingering warm weather has been rather spectacular (almost like a smoke-free, uncrowded summer in the Fall) but it has melted much of the snow from a month ago and limited snowmaking opportunities. The Ski Area was able to open a few more runs the last few days. But it was still way too many skiers and snowboarders on too few runs. It probably made for good business at Mammoth Hospital.
Despite the limited on-Mountain recreation, ecotourism is alive and well in Mammoth. It is becoming the main driver of Fall tourism. While the Ski Area struggled to get more ski runs open to accommodate the substantial holiday crowd, many were perfectly happy to casually explore natural areas on foot or electric bikes. A crowd flocked into the Lakes Basin even with road closures. The breweries were busy. Everybody looked glad to be here. Very few people wore masks.
After my last discussion about the non-enforcement of the most recent Town fireplace retrofitting ordinance (2013), one reader suggested the best thing the Town Council should do is “nothing.” Doing nothing is often (not always) the best response in many circumstances today. And this might be one of them. But if the Town wants to act responsibly they need to re-visit the topic, re-study it, rewrite the ordinance or abolish it all together. There is liability either way. Doing nothing puts the local real estate industry in a quandary. At least we can be candid about the fact there is no enforcement.
The new Ice Rink’s concrete slab was completed during the period and it is rather large and impressive. Incredible detail. In the future this is bound to be a very popular attraction and venue in the winter. The commercial properties at the south end of the Old Mammoth Road corridor should benefit tremendously by the additional traffic and people roaming around (I’m glad I have my little piece). The 25 mph speed limit will need to be extended to the south, especially if the new dog park is ultimately created at Mammoth Creek Park East across the street. Add in the increasing developments at the adjacent Mammoth Museum and the Sierra Meadows Equestrian Center, and this area will rival the Village for a fun zone. Especially with Mammoth Creek flowing through the whole area.
With increasing talk of real estate bubbles and “market tops” I decided to address the topic in a Mammoth Real Estate Q&A in this weekend’s issue of The Sheet. This is the most important local real estate read for the weekend. Nobody has any idea what 2022 will bring to this market. Meanwhile, pray for snow. But there is at least another week of fabulous weather in the forecast.
Wow! A 2 bedroom + loft / 3 bath at Sierra Park Villas closed for $706,000. It was originally listed for $599,000 (bidding war?). This is a remodeled unit in a good location but this is a whole new level of value for this project. The peak sales in the mid-2000s for this floor plan was right around $400,000. This is sold at $575 psf.
And then there is a 2 bedroom /2 bath closing at Courchevel for $810,000. Granted this unit has a 2-car garage but it is on the lower end of the project and not an easy to walk to Canyon Lodge. Peak 2000s sales for these units was ~$500,000. This is sold at $706 psf.
A 4 bedroom / 4.75 bath (2,742 sq ft) resale Creekhouse townhome closed for $2.1M. The seller purchased pre-pandemic and closed in January of 2020 at $1,203,000. The property was sold unfurnished. Townhomes located in the Snowcreek Resort continue to perform outrageously in this market.
Favorite New Listing for the Period
With inventory so low Favorite listings are becoming tougher to come by. Here is one I went and looked at because I had a client ask me about it. This is out in Benton which is the south east corner of Mono County. It is a pleasant (fun in a road car), no-traffic drive from Mammoth. In the early 2000s several Mammoth investors bought land in this area thinking it could provide affordable housing opportunities. It never really panned out. Here is a 2 bedroom / 2 bath AS IS manufactured home on 5.5 acres of flat land. The property driveway is right off of Hwy. 6 about 37 miles north of Bishop. Spectacular views of the White Mountains. There is a well and electrical at the property. Cash purchase only. Property hasn’t been occupied for several years.
Listed at only $69,900
Courtesy Eastern Sierra Realty
Other Real Estate News
A handful of readers asked me about my recent mantra “Use it now and remodel it later”. They are looking for further insight and specific tips. Some of this is my age-old thinking that has come to the forefront based on the current market conditions and the almost bizarre drive and obsession to have properties “perfect” for the holiday period and winter season.
Remodeling in the current market conditions is certainly viable but challenging. It takes a willing and available contractor(s) and skilled tradesmen. But most have very full calendars. If you can find an opening take advantage and be nice. But work still takes time. You cannot rush things. Some people seem to think the remodel projects they see on television actually happen in 30-60 minutes. Seriously. I’ve witnessed this mentality over the decades. Patience is a virtue, being realistic is sanity.
A more recent problem is the availability of materials and products. And rising costs. Even if items are available they may very well be delayed in the shipping pipeline. The absence of one item or material can delay a project. This makes the whole process even worse, contractors have to work around these delays and availability. And they start looking for “substitutes.” Things get juggled around, which is never productive.
So for many new owners who haven’t purchased a nicely renovated and turnkey property the best advice is to “use it now and remodel it later”. It will probably be a win-win situation. Owners can immediately focus on why they are here in the first place — to spend quality time enjoying their favorite outdoor activities and the mountain resort lifestyle. And this even applies to those owners who are looking for some STR revenue in the interim.
The first tip is to simply get rid of unnecessary stuff. Go minimalist. One of the jokes of the Mammoth real estate industry is “sold furnished” often means the seller is leaving behind years of accumulated crap. Mammoth has two fantastic thrift stores which assure many items can be recycled or repurposed. The turnover of these items is quite amazing in Mammoth. For everything else, dumpsters are your friend and usually close at hand.
Next, fix anything that that really needs fixing. But do it economically. Don’t obsess. Health and safety issues are a priority especially if going the STR route. Then clean everything as well as reasonably possible. Caulking in the bathtub/shower is a simple but often ignored critical improvement. New, inexpensive shower heads with a long reach not only dress-up a shower and but make it easier for the housekeepers to get the cleaning task completed quickly. Cheap white vinegar is your friend against Mammoth’s water. And go with LED bulbs everywhere possible. And most of this can be completed by any of the great Mammoth housekeeping and maintenance crews while the owners are out playing or are out-of-town.
Then throw some paint on anything that is in obvious need. Again, no need to obsess. Then a professional carpet clean. New, attractive bedspreads are relatively inexpensive and make a big impact.
Some other ideas; many older condos and homes have beautiful natural wood features including paneling, ceilings, etc.. Over the years new owners have ripped them out or painted over them. Mistake. (Remember the South West decor era where all of the wood had to be white washed?). Better to protect this natural wood and utilize it as a design element. Many of these natural wood features would be cost prohibitive to replace today and they give the interior of the property a “mountain feel” (this isn’t Palm Springs or Las Vegas). Again, better to utilize them as a design feature.
Cabinets are another story. New owners get taken down all sort of ridiculous paths by the latest trends. Many of the ~1980ish and newer condos and homes have cabinets that are of good quality. Many are better than the average of today’s products. They can be professionally stained, painted, or treated to look very nice especially with updated hardware. Countertops can be replaced with a variety of products, or not. Granite is still the best material and is “mountain.” The ongoing Westin “refresh” doesn’t replace the cabinetry in the kitchens and baths, just some updated finish and paint. And the granite stays too. The trendy touches are in the soft stuff; carpet, furniture, drapes, etc..
All of this can buy some time and also be a valuable process to get to know the property better; the special attributes, unique deficiencies to try to cure, etc.. Interior space is often limited in size in Mammoth so unique planning is required. And the use of small footprint, efficient furniture. Looking at what other owners/remodelers of similar units have done can be incredibly enlightening too. There are great ideas already out there.
In older condos and homes a major remodel is often going to require new plumbing, a new electrical panel, and more. This will mean more expense and time. It is best to have a well thought-through plan, and this takes time. And don’t chase trends or go to extremes. They become “dated” quickly. Timeless design is best. So in the fall of 2021 the “use it now and remodel it later” manta is a good one. And trust me, your short term renters don’t care either, they’re just glad to be here. But in this era of endless HGTV shows and instant gratification, I’m sure few will heed the advice.
Thanks for reading! Please stay healthy.
** Closed sale data is compiled from in-house files and public records.