Market Summary: March 31 – April 14
The Mammoth MLS is reporting 17 closings in Mammoth Lakes for the period ranging from a low of $97,500 to a high of $945,000. That is four (4) less than the previous period. The sales data reports only one (1) REO/bank owned property closing and NO short sale closing. Truly amazing… the REO and short sale closing have evaporated from the market. And like the last newsletter, the closed sales were evenly distributed throughout the whole price range. All-in-all, good sales activity through a spring period compromised by warm weather both here and in Southern California resulting in reduced visitation.
At the period’s end there are 113 condominiums listed for sale, an increase of one (1) from the previous newsletter and a push for the last four weeks. The inventory of single-family homes is down three (3) to 37 with only two (2) homes listed under $500K. Residential lots listed for sale are stable at 37.
The total number of properties in “pending” (under contract) in Mammoth Lakes decreased by one (1) to 83. Of the 83 properties in “pending,” 16 are “contingent short sales” and 34 are in “back-up” status. The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) increased by two (2) to 111. Inventory numbers are remain low but stable with new properties to-contract replacing the ones closing. Three REO closings in June Lake including two on the low-end.
Market Updates and News
The snow season of 2012-13 is now being touted as the “second heaviest December and the second driest winter.” If global warming weather patterns are for real then Mammoth may have some salvation. Those early warm storms that rained at town level and at most of the resorts in Tahoe provided tremendous coverage on Mammoth Mountain. Then the snowpack froze solid during the bitter cold of later December. And that snowpack is still providing damn good skiing right now in the middle April despite real further dumpage. Mammoth is truly a unique place.
The REO/foreclosure pipeline continues to dwindle in numbers. The banks/investors are in a stall pattern due to the new California Homeowners Bill of Rights. They are simply trying to figure out what the next steps will be (or should be, or might be) and to put them into action. I did finally get my post up about Short Sale Burn Out for a more in-depth discussion. Distressed property owners have some options and probably plenty of time to figure out their course.
I was in the Inyo-Mono Title (they process most of the Trustee’s Sales in the two counties) title plant in Bishop this last week and they confirmed that this is all a new and quite interesting development that the California legislature has thrown into the mix. The deed-in-lieu-of-foreclosure may indeed become fashionable; much like a cash-for-keys scenario, the lender gets the property back in good condition and is able to market and resell the property in a quick turnover period. This might be the new REO wave. And we might see REOs dribble through the market until 2020…
REO asset managers have played the “price discovery” game well in the past year. Most of the strategy is based on seasoning the REO listing on the market long enough (but not too long) to receive multiple offers and countering with a request of “highest and best” from the potential buyers. This has worked well to shake out the “best” buyer (“highest and best” is not always highest).
In the last few weeks the process may be failing. Or has it? Asset managers just seem to be “sitting” on offers and those delays just cause more work and frustration (and sometimes distrust) for all of those involved. And I have often complained that they don’t respect the role of “salespersons” in the transaction nor the “momentum of the deal.” Maybe they too are suffering from burn out. Or maybe they are just seeing the same trend I’m seeing. There are more and more small, independent “investors” throwing offers out without real commitment to the property or the marketplace.
They are making multiple offers on properties all over the place. This past week we had “serious” offers being withdrawn because “they got an offer accepted in San Diego (or Las Vegas).” This is the new trend, and we prefer to sort these buyers out. Meanwhile, even non-Fannie Mae asset managers seem more committed to placing low-end REO properties into the hands of owner occupants rather than investors. That’s an especially good thing here in Mammoth.
I’m also seeing a new, curious breed in here; the delusional move-up (within Mammoth) buyer. There’s always been some of this but I seem to have come-across more than my share in the past month. But right now they appear especially indignant (and unrealistic) about the valuation of the property they want to sell and the valuation of the property they want to purchase. It is almost comedy. Do they think they are such geniuses to be able to sell high and buy low within a short time frame??
Some believe their strategy even to the point that they will ultimately increase (dramatically) their total transaction costs in the move. Let me tell you; the key to “moving up” here in Mammoth is to find the RIGHT property that meets your needs and desires in a quality location (and learning and heeding the lessons from your existing property). Keeping the total costs efficient is a distant second. The best properties/opportunities aren’t always available, and the past has created many shoulda-woulda-coulda buyers.
The REO sale of 73 Dorrance for $363,000. This duplex is in the heart of the Sierra Valley subdivisions (aka “the Ghetto”). The property was neglected and is going to need considerable rehabilitation. The property was originally listed at some ridiculously high price based on a BPO (broker price opinion) completed by some ignorant agent in Mammoth. But eventually “the market spoke” and the price/value was discovered.
One of the things I gleaned out of this process is that a duplex in Mammoth offers more than “investment” value for many buyers. Buyers will pay far more than a pure “numbers” value for a property like this because it offers an appealing opportunity to have a second home/crashpad and an income stream and a “caretaker” on their property all in one.
The sale of MeadowRidge #37 for $600,000. This 3 bedroom + loft / 3 bath condo is on the bluff at this complex and has an jaw dropping panoramic view. Units in the same project of the 2 bedroom + loft floorplan can be purchased for less than $300K. That means a buyer paid $300K for the view and a extra bedroom/ bath. In the ’80’s and ’90’s we used to think big views added $5-10K in value. Not today.
The sale of Stonegate #8 for $945,000. This is one of the 3 + loft and den floorplan units (the smaller floorplan). This is the last of the Stonegate developer “related” units on the market. The same floorplan sold for $1,850,000 in April of 2008. Somebody should tell them (the Association) to take the broker’s ratty old sales sign off the property, it de-values the property.
Other Real Estate News
News reports from this week announce the potential settlement between between government agencies and the public/private partnership operating the fish hatchery at Conway Ranch. RE/MAX of Mammoth represented the owners/sellers of the old Conway Ranch development property (north west of Mono lake) many years ago. Ultimately the property was purchased for conservation purposes. Later, Mono County formed a public/private partnership with Tim Alpers, et al. of Alpers trout farm to establish a fish hatchery at Wilson Creek on the property.
With State fish hatchery funding and performance waning, this was a brilliant opportunity to raise and stock trophy trout in the waters of Mono County and Mammoth Lakes. Trout fishing is a critical component of summer tourism, and the better the fishing, the better the tourism. But then government agencies and attorneys (among others) got involved and… Tim Alpers left the partnership but did get himself re-elected as a County Supervisor. Now it looks like these plans can get back on track. With this operation in place, the already famous Mammoth and Mono fishery has the opportunity to become truly world renown in spite of CA DFGs stumbling.
Also in the news, there is a push to re-name one of the major streets (either Minaret or Meridian) in Mammoth after Dave McCoy. Sounds good to me. But I have to laugh… we already have Rusty Lane…
Back in 1990 I was doing business with Stan Hudec who developed many of the old subdivisions in Mammoth. And he had some great stories. According to Stan, they were grading the road that is now Rusty Lane and the grader driver had a golden retriever named Rusty. Apparently the dog was killed in an accident on the site so they buried him right there and named the street Rusty Lane. So for now the street remains named after a dead dog. Mr. Hudec also told me that Mala Ulice (in the same subdivision) is Czechoslovakian for “short street.” Now there’s a street we should re-name…
Thanks for reading!
** Closed sales data is compiled from in-house files and public records.