Mammoth Rocks And Signs of Life In The Local Real Estate Market!
Market Summary – August 14 to August 28
Single-Family Home Inventory
Market Updates and News
The beautiful summer weather in Mammoth continues. There have only been small traces of distant smoke. The major summer crowds are gone but this weekend featured the ever popular Mammoth Rocks event in the Village with a variety of rock-and-roll cover bands. Saturday also featured a “first” event; a 50 kilometer point-to-point mountain bike race dubbed Pedalpalooza. This event should be a keeper. All of this is what makes Mammoth summer so special.
In the past few days there has been even bigger excavation equipment and foundation-type steel components delivered to the Limelight construction site. It sure looks like they may begin real garage/foundation work before winter comes. This would be impressive, and telling. On the other hand the Ice Rink construction looks stalled. They are hustling to get the parking lot grading completed so they can pave before winter. But the Sprung part looks stuck.
One reader suggested that I’m strangely obsessed with the new Ice Rink? But the Town has never made this type of large initial/capital expenditure and one that will require incredible long-term maintenance and utility cost. All for something quite discretionary and catering to a small faction of the local residents and visitors. I did plenty of homework during the planning process. These facilities deteriorate rapidly. Many private ice rinks go out of business for this simple reason — they can’t keep up with the maintenance.
Secondly, I will still contend that this location is wrong. I was reminded this last week of the origins of the Wine Walk (last weekend) in the Village. It was an event in the mid-1990s named Art-a-la-Carte produced by the Mono County Arts Council (I was on the Board at the time). It was a lovely food, wine, art and live music event held on the Mammoth Creek Parkway. The event exemplified what a wonderful venue this was (and could have been) for special events; the Creek and special natural environment, the solar aspect, the incredible view, and at that time, the proximity to the new Mammoth Museum. All easily accessible to a large swath of people. Putting this massive structure on this rare site will remain a huge blunder in my mind. An opportunity lost for the lack of real vision. But I’ll get past my obsession.
There are now six candidates running for Mammoth Town Council in November including one incumbent and one past Council member. This is for three spots or what could become an important majority. But based on the general make-up of the candidates, it probably won’t form any new significant majority of its own. Most of these candidates are known to the broader community and I’m excited to hear their visions and platforms in the next two months. I have a feeling some sparks will fly. It is great to have this many candidates/participants. Hopefully somebody can ask them good questions. Hopefully some of them have some good answers.
I had a recurring real estate nightmare this past week. I have a new escrow with one of my former associates. She’s been a long-time top producing agent in Mammoth. But she persists on having her retired general contractor husband turned home inspector perform inspections for her buyers. She simply can’t see the conflict of interest. She didn’t back then, and she doesn’t now. Why her supervising broker allows this is beyond me (but he is one of my former associates too!). And why a buyer would agree to it is beyond me…..but people buy timeshares too.
Favorite New Listing for the Period
Other Real Estate News
Let’s look at the current news from the STR/Airbnb world;
You think Mammoth has a problem?? To deal with their workforce housing crisis, the resort community of Sedona, AZ recently set aside $240,000 per year to subsidize owners NOT to do STR and rent to members of the local workforce. Sedona has seen a whopping increase of nearly 4,000 STRs in greater Sedona since 2017 and has more than doubled their “hot bed” base. This increase in available beds has allowed tourism to explode and has subsequently created an extreme workforce housing shortage.
The new program will subsidize a 3-bedroom homeowner ~$10,000 over three years if they rent the property for no more than $2,200 per month to local employees. This is far below the average rents in the area. The ADR in Sedona is $301 and occupancy can run as high as 77%.
Run these numbers through your calculator. The subsidy is a nice gesture but it wouldn’t interest (motivate) most of the STR/investors owners I know. Mammoth has discussed this type of program/subsidy, but the combination of revenue and usage is just too attractive for most Mammoth STR owners.
The STR industry metrics from AirDNA for July 2022 are interesting (these include properties listed on Airbnb, VRBO, Expedia, etc. in the U.S.)
- Available listings reached 1.39 million which is up 25.5% YOY and up 10.5% since 2019.
- Guest demand was up 18.2% YOY and up 20.6% since 2019.
- Average daily rates (ADR) were up 3.7% YOY and up 26% since 2019.
- Revenue was up 22.6% YOY and up 52% since 2019. (This may explain the Town’s recent explosion in TOT revenue.)
- Nights booked were up 19.1% YOY.
Also, the AirDNA authors further point out that the increase in demand was primarily driven by last-minute bookings, and luxury listings saw the biggest pull-back in revenue.
Specific Airbnb points of interest from the end of the second quarter (Q2);
- Active listings for non-urban destinations grew by nearly 50% from Q2 2019 to Q2 2022.
- Their guests typically booked earlier in Q2 2022 over Q2 2021. The global lead time is now 56 days.
- ADRs grew 1.7% YOY.
- Large cities and urban markets in the U.S. continue to lag but listings and occupancies are up.
AirDNA is now promoting the “benchmarking” of STR properties by
1.) Examining what the best-rated hosts are doing by re-evaluating owner’s amenities and policies.
2.) Comparing and contrasting amenities.
3.) Studying the success of other property managers.
4.) Understanding seasonality trends.
5.) Expanding the knowledge of different locations and submarkets.
Interesting list, but we’ve been doing this type of analysis for years in the Mammoth market.
And lastly, for those new to AirDNA and their analytic tools, here is a nice video. AirDNA offers casual consumers a significant amount of data. For deeper dives the service can be a little pricey, but it might be worth it for serious STR investors.