Mammoth Real Estate Sales Report – October 15, 2023

Town Declares An Urgency Ordinance And Moratorium On New STR Permit!

Market Summary –  September 24 to October 15

This report is for the last three weeks. And it may run a little long because there is a lot to talk about. The Mammoth Lakes MLS is reporting 27 real estate closings for the period ranging from a low of $415,000 to a high of $3,700,000. Of the 27 closings, 26 were financeable properties and only 10 were closed with conventional financing. The closings included five (5) properties closing for more than $2M including two (2) single-family homes over $3M. The closings also included four (4) Creekhouse units and two (2) Obsidian Villas units. The low sale was a Studio unit at the Westin Monache.
The 10-year Treasury yield moved upward again during the period to 4.629%. It was considerably higher at other points in the period. Conventional mortgage rates are being quoted in the high 7% range. Shorter term Treasuries are still sitting in the mid 5% range. A video of Rick Santelli on CNBC (probably the only person worth watching on the channel) went viral with him explaining why the 10-year could (will) be in the 13% range within 5 five years. Laughingly, many of the critical pundits were claiming that people over 60 years old (with decades of experience) can no longer grasp modern financial theories. Maybe this applies to me? On the flip side, Treasury Secretary Janet Yellen was quoted this last week that the federal government can no longer afford these higher Treasury rates (it can’t). Who will be right is unknown. But the millions of property owners with ~3% fixed rate mortgages will continue to be a fascinating aspect of the overall real estate market. I’m wondering when the real estate industry will start pushing for acceptable AITDs (wrap-around mortgages) and other financial mechanisms to facilitate more transactions while retaining those underlying mortgages. Time will tell. 
An increasing number of local buyers/borrowers are utilizing “STR loans”—stated income loans based on revenue data from sources like AirDNA, Realtor-com and Redfin. The loans are still requiring significant down payments so it is not a subprime-type of issue. Here is an interesting discussion about “Airbnb loans” from AirDNA

Condominium Inventory

At the period’s end the condominium inventory is up seven (7) to 64. So Labor Day 2023 will not stand as the peak of inventory. There were 17 new condo listings in the three week period and two (2) have already gone to escrow. More price reductions in the period. There continues to be concentrations of listings in a few specific projects. This is always a red flag and also creates (price) competition amongst the units. These properties are primarily in the low-end of the market.


Single-Family Home Inventory

The inventory of single-family homes is down four (4) to 23. There are still seven (7) homes listed under $1M. Surprising they haven’t moved over the past three weeks, especially as winter approaches. Some of this inventory is likely to come off the market once some snow falls. 


Pending Transactions

The total number of properties in “pending” (under contract) in Mammoth Lakes is down 21 to 35 at period’s end. The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is down 23 to 60. Higher mortgage rates are clearly stalling the market, although the statistics show there are still plenty of cash buyers in the market. Of the actual sales, there is no clear pattern to what is selling and what is not.


Market Updates and News

October 2023 will prove to be classic fall weather in the eastern high Sierra with mostly sunny skies, warmer temperatures, and a slow turn of fall colors. A variety of regional prescribed burns have created some smokey conditions but winds have mostly blown the smoke out of the region. These controlled burns should continue in the weeks to come and even after a little snowfall happens. The pleasant weather is certainly welcome, especially for those still trying to complete repair projects from the past winter. Tourism remains on the slow side but is not dead. And again, this is a great time to be here. 

Late last Thursday the Town Of Mammoth Lakes announced an Urgency Ordinance to be placed on the upcoming Town Council meeting agenda on Wednesday Oct. 18. The Urgency Ordinance is drafted to be passed (requiring a four-fifths vote) and will place a minimum 45-day moratorium on new TOT/STR Certificates. The moratorium can be extended up to almost two years and does not include properties in Resort zones and in the North Village Specific Plan.

After reading through the staff report and draft Ordinance, what jumps out at me is the Town declares it can take “measures to limit or otherwise regulate the number, location, and/or other aspects of short-term rental properties in Mammoth Lakes.”  The moratorium is designed to allow the Town time to further investigate the current STR regulations, all in light of Mammoth’s severe workforce housing shortage. The staff report implies that the specific 2015 Quality of Life Ordinance regulating STRs needs to be updated and create additional regulations including annual review of STR properties to certify compliance.

One recommendation in the staff report is that property owners need to increase “Word of Mouth Conformity” within condo projects; “In making the owners more aware and accountable of the requirements to rent transiently, compliance should improve as owners who are held accountable will self-enforce other owners in their complex.” Now that’s a great policy—turning owners within HOAs into snitches and policeman always works out well.

The staff report also implies that owners, rental agencies and property managers are grossly out of compliance with the Quality of Life regulations. I live the Mammoth STR market rather first hand; I list, sell, walk-through these properties on a daily basis and directly observe the volume of companies and service providers who do the work. The level of competency is very high especially in light of how stressed the market can be and the overall employment situation. I look forward to seeing what the Town’s research during the moratorium uncovers. I hope they find something tangible.  

But the nexus between greater STR regulations and solving the workforce housing problem still evades me. But the Urgency Ordinance states that it is fact. I think the Town has a ulterior motive here. They tried in the recent past, through the Chamber of Commerce, to convince some of the older, legacy owners of local condos who were currently operating STRs to convert their properties to long-term rentals. It failed. So now they have the opportunity to create a mechanism where some of these older properties won’t meet the new “requirements” of the revised Quality of Life Ordinance. These older condos could have all sorts of vulnerabilities to more scrutinizing STR regulations (maybe they will find Formica counter tops are a health and safety concern). The local Realtors fought this war back in 2015. 

It is true that outside of their own owner usage, many of these units could actually cash flow better as long-term rentals rather than STRs. Maybe the Town is seeing the opportunity to strong-arm these owners into the long-term rental market. We’ll see. Based on this recent action, I’m assuming they have the four Council votes (sounds like a potential Brown Act violation). The timing of this is also curious because Mammoth has a lame duck Town Manager and currently no Planning Director. And my recent discussions about zoning becomes even more interesting in light of this proposed ordinance. I had already planned to discuss the current state of the STR market, so there is additional discussion below in my Other section.

The summer quarterly TOT numbers are currently being reported and the results will be of great interest to many. Entities from local businesses to the Town may have to plan accordingly. 

Governor Newsome just signed a bill that allows the “fast-tracking” of “affordable” housing on land owned by religious institutions. And this includes their parking lots. (Maybe Mono County should find religion?) The brand new law allows for bypassing most local permitting and environmental review. I see a fiasco in the making. 

The Cowboy State Daily recently reported that the town of Jackson and Teton County purchased eight new electric transit buses, and none of them are working. The manufacturer, the California-based company Proterra, has filed for bankruptcy and necessary parts aren’t available. The best quote of the article is from the Transit Director about the performance of the vehicles, “There is a difference in performance between cold weather and warm weather.” Brilliant. The good news(?) is that the buses were paid for by the federal government under the 2021 Infrastructure Law.

And finally, the Ski Area gave a presentation to the local Realtors during the period and the biggest take-away is that Alterra remains committed to making $40-45M in capital expenditures to Mammoth Mountain every year in the future. (They have so far every year of their ownership.) This is so profound and unlike any of the previous owners. Woolly’s Park will continue to become the winter and summer recreation spot. The new coaster is just about completed and construction of the two-story Lodge has started. The Main Lodge ropes courses will be moved down to this area and the snowmobile tour center too. All of this is a set-up for the eventual scrapping of the entire Main Lodge area. More and more services and mobility will be focused on the east side of the Ski Area. 

Chair 1 will be closed in April of this season to begin its replacement. The ski trail signage will all be replaced to match the new signage in town. And of course, more and more snowmaking capability to insure early season operations. In the 3-year horizon there will be more changes at Canyon Lodge including an addition to the gondola side of the building. And yes, they even plan to replace Chair 1 at June Mountain. 

The Limelight construction will shut down for the winter once the snowfall begins. The two levels of parking garage are substantially in place. This is going to be an impressive structure. 

Noteworthy Sales 

Two 2-bedroom / 2 bath units at Juniper Springs Lodge closed in the mid-$800,000 range. Nothing special about either unit. Solid pricing is holding in these units.

My “favorite” $4M residential listing of the past weeks sold for 10% less than the original asking price. This list-to-sale ratio is becoming a common trend in the local market.

An older duplex in Sierra Valley Sites closed for over $1M. The appetite for Mammoth income/investment properties remains beyond crazy.

Other Real Estate News 

Before the announcement of the Town’s proposed moratorium on STRs, I intended to cover the latest from the STR/Airbnb/VRBO world. Now these items are even more appropriate.

While I was gone the past two weekends, The Sheet covered the June Lake’s community balance between tourism, workforce housing and government revenue and services expenses. The next County Supervisor’s race for this district will feature two new candidates with rather opposing viewpoints on the matters. The quote down below about the “county’s failure to adequately address the workforce housing shortage” and others are perfectly appropriate. 

Meanwhile, additional moratoriums on Airbnb and STR activities in New York City are creating more chaotic behavior (they actually want STR properties to be registered with the City!). But there are increasing reports that the latest moratorium is creating a huge black market for STRs facilitated by various social media sites. It is bound to happen—the law of unintended consequences is for real. Here in Mammoth, a black market for single-family STRs has always existed. Savvy owners have learned how to skirt the annoyed neighbors, and the Town. A similar black market of sorts is evolving in the local condo market and social media private groups and other resources are part of it. People can be so connected today. 

Ironically, many of these local black market owners are simply frustrated with the Town’s lack of respect, cooperation and support, and detest generating tax dollars for the Town’s wasteful management policies. The Town’s further restrictions and efforts will likely create even larger off-market enterprising. The Town has grossly underestimated the intelligence, character and creativity of the second homeowners wishing to generate revenue from their resort properties. All of this will drive alternative STR (and MTR) strategies. We’re back to the 70s and 80s of advertising your Mammoth STR in the back of firemen trade magazines.

An August 17 article in the Colorado Sun highlights a new lawsuit against Summit County, Colorado over STR regulations. The lawsuit claims the County Commissioner’s “justifications for its excessive STR regulations, including that STRs deprive the County of local workforce housing, are fabricated and seek to involuntarily enlist private homeowners to solve the county’s failure to adequately address the workforce housing shortage.” ( Again, pretty much summarizes the scenario with Mono County.)

From the article, “Who says you have a right to live where you work?” said Todd Ruelle, a Virginia resident who has rented a home he bought in Summit County near Breckenridge since 1980 and is spearheading the lawsuit. “You live where you can afford to live. I wish I could live in a penthouse in New York City. Does that mean I’m entitled to a penthouse because I work there?”

I also receive a regular newsletter (nothing like mine) from a RE/MAX agent in Breckenridge. A recent issue was calling for “Please Donate Today To Save Our Property Rights”. The newsletter says the donations will help fund a lawsuit against the Town of Breckenridge for their restrictions on STR. A positive outcome of such litigation would help “set a precedence for the County as well as other Mountain Towns in Colorado (and maybe Mammoth?).

“These restrictions have not only cost many locals their incomes but many small businesses are suffering and the tourism industry will be impacted in the long run which affects all of our livelihoods which could have devastating consequences on the vibrancy of our beloved town. Living in a small town like ours survives purely on tourism. Even if you do not live here full time but own property here or want to buy property here your Real Estate Investment will be impacted by these restrictions if we allow it to continue.”  

The lawsuit “represents property owners without local voting status.” (The old taxation without representation.) They have raised $250,000 already and are trying to raise another $150,000 according to the newsletter.

Mr. Ruelle of the Breckenridge group was also quoted in the Sun article, “They don’t use data,” he said, describing a meeting where a county commissioner said the 35-night cap “feels good.” “They pull these numbers out of their back-end and try to sell the public that it’s the truth.” 

Ruelle bought his home near Peak 7 in 1980 for $80,000. He was 23 and making $18,000 a year. He paid 17% interest on the loan and started renting to visitors through a management company in 1990 to help pay down his mortgage. 

“If you work in a resort community you try to figure out how to buy a home through hard work, creativity and entrepreneurship so you can get yourself a place to live,” Ruelle said. “We want to make Summit County ground zero for this fight and make it a focal point for the nation. Many of these resorts started when there was no place to stay except people’s homes and owners rented to visiting skiers. We helped start these economies and we continue to drive local economies.” 

The “Digital Government” platform Granicus has an article on “Short Term Rental Bans Gone Wrong.” Part of the conclusion;“Rather than turning first to a full out bans, local governments should consider if it may make more sense to put in place compromise regulatory frameworks that allow short-term rentals that meet certain requirements while protecting the interests of the broader community. By doing so, communities can can harvest the benefits of this new industry and avoid exposing themselves to expensive and time-consuming legal battles. Cities like Denver, Los Angeles, and Vancouver, British Columbia, are doing just that. While the specifics vary, the underlying idea is the same: Explicitly identify the unwanted behaviors and negative consequences of short-term rentals, and devise specific, practical policies to mitigate them.

With the advancements in big-data technology it is now possible to enforce such policies, and identify addresses of short-term rentals to bring them into compliance with local rules. Many innovative municipalities including Placer County, California; Durango, Colorado; Asheville, North Carolina; and Islamorada, Florida, already use such tools and have seen double-digit improvements in compliance and revenue. This allows these cities and counties to double down on enforcement to further ensure that short-term rental operators stay within the designated zones, pay their fair share of taxes, and are accountable and respectful of neighbors.”

The Town of Mammoth Lakes, by virtue of decades-old zoning regulations and the Quality of Life Ordinance of 2015 have had all of this in place for years. The question today is; Have these regulations failed or are these new moratorium and regulations all about strong-arming the owners of marginal STR properties into the long-term rental pool to theoretically improve the workforce housing supply? We’re going to find out.

And looking forward, the end-of-the year holiday rental period appears to be far from booked-out. Many properties appear to be at above the peak pricing of the past two years and not booking, yet. Other reservation companies are already promoting discounts. Some would-be renters are taking a wait-and-see attitude to see if rental rates drop. And of course, to see what the snow conditions will be like.

The Mammoth STR market will be worth watching in the coming months and maybe years. That darn law of unintended consequences always makes for good entertainment.

Thanks for reading!


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

4 thoughts on “Mammoth Real Estate Sales Report – October 15, 2023”

  1. Well written Paul.

    I wish I would have bought property from you when we met 20+ years ago.

    Is it Tucker Stone. In Brel that you mentioned in your blog? I am on a master mind with him.

    Are you still in the RE/MAX system? Let’s connect again.

    Ed Evans

  2. This was a well written article. Looking forward to seeing what the solution and the outcome will be. It’s becoming it’s own kind of Netflix series on how fast things are changing in the real estate world.

  3. Very good, informative information. Thus us taking away Homeowner rights. Put a Moritorium on new single and multifamily dwellings being built too. Mammoth is a tourist town, let the tourists tour! This takes away from the town and local businesses thriving.


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