Mammoth Real Estate Sales Report – July 31, 2022

Mortgage Rates And Gas Prices Drop And Mammoth Tourism Rises!

Market Summary – July 17 to July 31

The Mammoth Lakes MLS is reporting 13 real estate closings for the period ranging from a low of $265,000 to a high of $3,487,000. Of the 13 closings, 12 were financeable properties and six (6) were closed with financing. And like the last period, the closings included two Obsidian Villas townhomes that were put under contract over a year ago. The high sale of the period is a Snowcreek Ranch luxury home and it was a cash purchase.

The 10-year Treasury yield closed the period down almost 30 basis points to 2.642%. Despite Federal Reserve’s continued upward push of the federal funds rate, mortgage rates dropped significantly late this last week, and almost a full point in the last month. The industry explains the drop as a result of investors who buy Mortgage Backed Securities believing rates topped out in June, and all that goes with it. For those interested, it is a lengthy explanation. The good news is rates are coming down and there could be another round of refinancing by those who purchased recently. The article states, “Mortgage rates have been all over the map recently, both in terms of their movement and in their variation between lenders. The disconnects are so big….” The simple word-to-the-wise is any current borrowers should be shopping their loans and not relying on just one lender. I was also recently reminded that the current mortgage rates are very similar to those of most of the 2000s.

Condominium Inventory

At the period’s end the condominium inventory is up four (4) to 77. Most of the new additions came late this last week and were in the low-end of the condo range including units that are typically very good STR properties. There were 10 new condo listings in the period and none have gone to escrow. There were nine (9) price reductions in the period. There are now 23 condos listed under $500,000 and 42 listed under $600,000. Interesting. These are the “affordable” properties in town, and again make for good STR properties. There are nine (9) units listed in the Westin Monache and only seven (7) in the entirety of Snowcreek. This time last year there were 46 condos on the market.

Single-Family Home Inventory

The inventory of single-family homes is up (2) to 30. There are 15 homes listed under $1.5M. Median and average prices continue to drop. This time last year there were 19 homes on the market.

Pending Transactions

The total number of properties in “pending” (under contract) in Mammoth Lakes is down nine (9) to 47 at period’s end. The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is down 11 to 82. This time last year it was 97 and 144 respectively. The numbers now show some market stagnation, at least for this period. We’ll see if more visitors and lower mortgage rates will spark the market. Or maybe we will have to wait for “the anticipation of winter” that always creates demand. There continues to be significant traffic on my websites; lots of people watching the market activity and especially new listings. Another observation; potential buyers this summer want you (me) to work around their recreation schedules. What a difference a few months make.

Another question I’ve been getting; Have you ever experienced such climbing real estate values in such a short period (as the last two years)?

The answer is yes; 1999 to 2001. In the midst of the dot com bust and the Y2K fiasco. One property I purchased in 1998 and sold in 2001 tripled in value (lucky me). Another property almost doubled in the year 2000 alone. And that period was just the beginning of strong appreciation throughout the market that peaked in 2006-07.

Market Updates and News

Summer tourism should be peaking right now with the upcoming “Bluesapalooza week” as the new busiest week of the summer. Mammoth experienced a few days of light smoke during the period but has been blessed with more warm, clear weather. The forecast is for cooler weather this next week with a chance of thunderstorms. Tourism has been on the upswing the last few days. Could a 50 cent difference in a gallon of gas be that impactful? Overall the crowd continues to be a night-and-day difference from the mobs of the past two summers. It will be interesting to see what the TOT (bed tax) and sales tax numbers look like for the period, and in comparison to previous numbers. I haven’t heard any business owners complaining.

The Town front is quiet but three Town Council members are up for re-election this fall. But one will be moving to a County Supervisor seat in January. The other two are likely to run as incumbents. Mammoth has a long history of odd-balls and eccentrics running for Council who stir-up the issues. It seems par for the times. It can be rather healthy, and some even get elected. This year may be no different. Somebody could win with minimal votes.

Meanwhile the Ice Rink structure is far from complete and it is massive (as expected). The Limelight grading and excavation is a serious work in progress and the whole hillside may be down to street level by Labor Day. It is now a dramatic construction site. Construction at The Parcel seems painfully slow and it is hard to imagine any of it being “buttoned-up” by the first snowfall. The good news is that Mammoth Lakes Housing continues to pro-actively purchase existing properties to put into the deed-restricted workforce housing pool. I talked to one long-time local resident this last week who was placed into one of these properties and he was elated. It means he can stay in town and continue his employment driving public transportation. And he is a perennial volunteer.

There was a C-130 Hercules from the 152nd Airlift Wing (aka “High Rollers”) of the Nevada National Guard parked at the Mammoth Airport all last weekend. These aircraft and this unit have been pushed into service to fight wildland fires in the west when the civilian fleet of aircraft wears thin. They have been utilized to drop fire retardant and are usually assigned to the most critical events. They might have been on stand-by due to the fire west of Yosemite. But their stay also perfectly coincided with the Mammoth Reggae Festival last weekend. Hope they had a good time, they deserve it. It was impressive to watch the behemoth take off.

Noteworthy Sales

Two more Obsidian Villas units closed for $1,695,000. These units were also put to contract in March in 2021. And the previously mentioned similar unit “furnished and decked-out resale can be purchased for $2,875,000” went to escrow in the period. We’ll see what it closes for.

The corner commercial lot at 3599 Main St. closed for $265,000. This lot has been on the market for the last decade.

A well-worn duplex in Sierra Valley Sites closed for $700,000. It was owned and occupied for decades by one of Mammoth’s most notorious residents. If only the walls could speak….

Favorite New Listing for the Period

While this property might seem perfect for a local resident or a small family, this could be a great second home. Located in Crowley Lake in the popular Hilton Creek drainage area, this charming 3 bedroom + loft / 2 bath home features beautiful hardwood floors, a floor-to-ceiling stone fireplace, front and rear patios, large mudroom entry, new picket fence and lots more. The large loft could make a great shared office space or a fun room for the kids. Recently painted inside and out and modern composite roof. Real country living and only 20 minutes from Mammoth and out of the heavy snow zone. Check out the video tour.

Listed at $749,000

Other Real Estate News

The last few months potential buyers and others have recurring questions and interest in certain things. So let’s cover some of the interesting yet lesser known aspects of Mammoth real estate.

First, I have often reiterated the importance of Mammoth’s long standing zoning pertaining to STR and transient usage. Most of it pre-dates the Town of Mammoth Lakes’ incorporation in 1984. As communities around the nation struggle with STR in their local neighborhoods – like many beach communities in SoCal – Mammoth’s regulations for STR are well established. And enforced. This is invaluable to buyers and property owners who do, or don’t, want involvement with STR.

But one question that keeps coming up is the rentability of homes in the Sierra Valley Sites subdivisions (aka The Ghetto). There is some specific history here. This is an area of four parallel streets, Manzanita, Mono, Lupin and Joaquin (east to west) located between Main St. and Meridian Blvd.. This is a historic neighborhood dating back to the 1940s that is now filled with variety of older, small homes and duplexes, apartment buildings, Town workforce housing and Ski Area employee housing. This was all originally zoned R-2 and R-3 (north to south). There was/is a history of STR in these neighborhoods. But in the 1990s the Town decided this area should be preserved for non-STR use or workforce housing (it was rather prescient in hindsight).

These neighborhoods were subsequently zoned RMF-1 and RMF-2. The RMF-1 zoning now encompasses the majority of the subdivisions and doesn’t allow for STR. The balance of older existing condominium projects in the area are zoned RMF-2 and do allow for STR and are clustered close to Meridian Blvd.. The ultimate answer is “no” you can’t buy a small home in this neighborhood and do nightly rentals.

Another repeated question is; Do the condo hotel properties have usage covenants? The answer is no. This is common in places like Whistler/Blackcomb where owners are subject to Covenant 1 and 2 restrictions which limit owner usage to maximize rentability. But Intrawest quickly discovered in 1996 that the California Department of Real Estate would not allow such covenant restrictions and weren’t likely to budge on the topic. Today’s end result is that condo hotel owners in Mammoth Lakes can use their units however they like, whenever they like, and can rent or not, and can rent anyway or with anyone they like. All of that to the consternation of the front desk operators.

I also get the comment “There’s so much land around Mammoth to develop”. This answer is another NO. Mammoth is a true island in a sea of government owned land. Just ask Tom Dempsey or Rusty Gregory about how hard it is to get any of that land away from the government. Very few have the time, money or incentive. The Snowcreek “back 10” land took 25 years and the land is clearly deeded for golf course usage only. The Ski Area Main Lodge exchange took 15 years and there were highly-coveted environmentally sensitive lands traded for the already urbanized property at the Main Lodge.

Mammoth Lakes is less that four square miles of privately owned land. Mono County is 96% government or quasi-government owned land. There is actually more land reverting back to public ownership in the County than being privatized. And there are a variety of Land Trusts proactively continuing this trend. The concept of “Small Town, Big Playground” isn’t going to change. Oh, and by-the-way, that beautiful parcel to the south-west of the Meridian/Minaret intersection is owned by the Town of Mammoth Lakes. It is supposed to remain open space, but I’m sure some future Town Council will want to do something ridiculous there….

The history of The Bluffs is interesting. It is one of the oldest subdivisions in town but you wouldn’t know it by driving through it (some of the new homes are spectacular!!). It was laid to paper and individual lots were sold in the early 1920s. But over time, one owner maintained a 70% ownership of the individual lots. The subdivision wasn’t actually constructed until the late 1990s after significant lot line adjustments and road realignments. And if it wasn’t for an amiable and likable rancher from Temecula who acquired the 70% ownership at a sheriff’s sale it might still be sitting up there undeveloped. A classic Mammoth story for sure….. And we still really don’t know if any remnants of the pioneer cemetery are up there or not.

And finally, Mammoth’s use of electric heat is bound to be in a resurgence phase. Amerigas’ performance and reputation certainly isn’t helping. The multitude of condos built in the 1965-85 relied primarily on electric heat. The wood burning fireplaces were all for show. But with increased electric costs, the introduction of more efficient wood burning, and eventually propane being more commonplace, electric heat today is used only by necessity. New innovations and efficiencies are changing this. How quickly all of this gets adopted but is anybody’s guess. But there are property owners all around town beginning to push the envelope. It will be an interesting evolution. Now if we could just tap into the massive geothermal power plant down the road. Too bad we weren’t more prescient about that.

Thanks for reading! Please stay healthy.

** Closed sale data is compiled from in-house files and public records.