Market Summary: July 19 – August 2
The Mammoth MLS is reporting eight (8) real estate closings in Mammoth Lakes for the two week period ranging from a low of $169,500 to a high of $1,450,000. For a second period in a row, that is even with the previous period. Of the eight closings, all eight were technically financeable properties and five (5) were financed. There were no REO/bank owned property closings and no short sale closings reported. The Mammoth real estate market is slower but steady. The early and mid-summer are not known as peak real estate activity periods.
At the period’s end the condominium inventory is down eight (8) to 205. There were eight (8) new condo listings in the period. So the condo inventory has settled into range that it will likely stay at until Labor Day. And then the pre-winter sales push should begin and inventory should decline. The inventory of single-family homes is down three (3) to 68. A couple of the new listings were on the market last summer. And the summer before. There were also a handful of price reductions.
The total number of properties in “pending” (under contract) in Mammoth Lakes is up nine (9) to 69 at period’s end. Of the 69 properties in “pending,” four (4) are “contingent short sales” and 39 are in “back-up” status. The total number of pending in the aggregate Mammoth MLS (which includes outlying areas) is up five (5) for the period to 95.
Market Updates and News
The dog days of summer haven’t been especially hot here in Mammoth, but the weather has been quite nice. There has been considerable rain and that is good news. The Mammoth region of the eastern Sierra is as green and lush as anyone could expect considering the fourth year of drought. The dog days have also brought a general lull in the local news flow.
The 20th annual Bluesapalooza is in the books and the event just gets bigger every year. Even the Thursday night event was massively attended. It has truly become the event of the summer. Most of the complaints this year were about tickets for certain events being sold out. The attendees are amazingly well programmed to walk or utilize the public transportation. About 4pm every day the masses (with folding chairs in tow) move towards the event site in the middle of town. An increasing number of “side events” are popping up at various locations. The event again experienced some minor forest fire smoke, but not nearly as bad as the past two years. The owners of Mammoth Brewing are to be commended for running such a great event.
The referendum vote for the single-family nightly rental ordinance is two months away. There isn’t any sighting of the controversial vote around town from what I can see. But that will change soon. Meanwhile, Mammoth is not alone in dealing with this topic. Mountain resort communities in the Rocky Mountains are having their problems too. This article in last week’s Vail Daily shows other resort communities are having similar experiences to Mammoth. And each resort has varying problems. They are even blaming the increase in transient rentals to rising rents for local residents. But the article also points out that premium rentals do more than increase the revenue for property owners; the ancillary business attached to these rentals, from custom catering to massages, etc., increase local business revenues too.
The Old Mammoth Place was back in the news this week. This is the large and aggressive redevelopment project planned for the property where the existing Sierra Nevada Resort (the old Sierra Nevada Inn) is. The Plan is back under review by the local agencies. But the owners of this project have recently dumped millions into renovating the old hotel and have spent substaintlally to re-brand and re-market the resort. So this effort is simply to protect the existing entitlements that were granted in 2010. So they will be back in five years again, and in ten years, and….
The balance of August is filled with numerous special events, most combining live music with some flavor of alcohol. But there is also Shakespeare, the Symphony, Chamber Music, Arts & Crafts, and on and on. August is a great time to be in Mammoth.
Another residential sale in the ~$1.5M range continues that trend. And typically, it was a cash purchase.
Half of the sales for the period were condos under $350,000 with no real indicator of rising or falling prices.
Two of the sales were 2 bedrooms / 2 baths condo hotel units, one at Sunstone at Eagle Base ($410,000) and one at Lincoln House ($445,000). Both sold for solid prices especially considering the time of year. Values are holding steady if not increasing in this segment of the market.
Another old, small income property sold for a substantial price. Like I have said in the past, this segment of the market was “can’t give it away” for decades. Now it is one of the hottest segments.
….And after my discussion about properties being listed/sold as a percentage of what they sold for in the market peak of 2004-06, a Woodwinds townhome was listed during the period for 61% of what it sold for in 2007. It will likely sell for less than that.
Other Real Estate News
August 1 is the official start of a new era of real estate lender disclosures in the United States. And it is another anacronym heaven. The Consumer Financial Protection Bureau or CFPB was created as part of Dodd-Frank Act in 2010. So we’re just getting around to implementation. The CFPB has the new “TRID Rule” which is part of TILA-RESPA…..So what does it really mean?
Real estate borrowers will now be provided a more up-to-date set of disclosure forms when applying for and finalizing mortgage loans. The old Good Faith Estimates, Truth in Lending and HUD-1 disclosures are going away. The new Loan Estimate disclosure will be provided to the borrower at the beginning of the loan process. This will supposedly allow borrowers a more accurate way to compare and “shop” for competing loans. They will also more clearly spell out the long-term obligations of the loan (which will be helpful under non-fixed rate lending).
The new Closing Disclosure will supposedly provide the borrower a clearer picture of the closing costs associated with the loan. This disclosure must now be presented to the borrower at least three days before the closing (thank God for email). There are now much tighter restrictions between how much fees can increase between the original Loan Estimate and the Closing Disclosure. In most cases, there can be no variance in those fees.
Loan officers and escrow agents are already warning about closing delays because of the new 3-day rule. If any of the items in the Closing Disclosure are changed, then the loan cannot be completed (and escrow closed) for another three (business) day waiting period.
And some lenders have already been using the new disclosures while others are lagging behind. Some estimates are that only half of the lenders are ready.
The key take away; buyers and sellers will simply have to be more patient with the loan process. Longer escrow periods with the “or sooner” closing date should be part of every offer just to keep everybody from getting out of control.
In the meantime, borrowers should be getting more accurate loan information right up front, and that should be a good thing….
Thanks for reading!
** Closed sales data is compiled from in-house files and public records.