Market Summary: December 21 – January 4
Happy New Year to All!
The Mammoth MLS is reporting 7 closings in Mammoth Lakes for the two week period ranging from a low of $180,000 to a high of $837,000. That is down 11 from the period before, but that is to be expected during the holiday period. There was one (1) REO/bank owned property closing and no short sale closings. Of the seven (7) real estate sales, six (6) were financeable properties and all six were purchased with conventional financing.
At the period’s end the condominium inventory was down five (5) to 131. But that is misleading. There were new condo listings during the period but the overall decline can be attributed to expired listings (why agents run their listings to 12-31 has always been a mystery to me). These listings will most likely come back to the market once everyone gets past the holiday fun and gets back to work. We’ll see if they come back with new (lower) pricing. Or maybe with new listing agents more inclined to “work” the listing in the eyes of the seller. This time last year there were 86 condos on the market.
Single Family Inventory
The inventory of single-family homes is down five (5) to 53. Again, some new home listings but even more expired listings. They’ll be back sooner or later. There are still six Starwood home on the market competing with each other (but one is in escrow). There are five home listed under $500K. Last year at this time there were 37 homes on the market in Mammoth.
The total number of properties in “pending” (under contract) in Mammoth Lakes is down one (1) to 46 at period’s end. Of the 47 properties in “pending,” six (6) are “contingent short sales” and 18 are in “back-up” status. The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is down three (3) to 66. These numbers are just slightly higher than last year at this time.
Market Updates and News
The holiday crowd has been substantial but not crushing. My polling at the reservation companies (while picking up condo keys for showing appointments) indicates that bookings fall to nothing as of this next week. The all important ski conditions have deteriorated. The recent snow storms simply haven’t had a focus on Mammoth. I skied New Year’s morning and the limited runs were decent and fun. By 10:30 the runs were overcrowded and quite dangerous in my opinion (I’ve had 30 season passes). The east side of the Mountain hasn’t opened except for a small path to Eagle via Canyon Lodge. The major run off of Chair 5 (Solitude) had great snow but it was full of small rocks. The face runs are dicey although there are some lines to be found.
As 2015 begins the media is full of “year in review” and predictions for the year ahead. I seen no reason why the 2014 trends in Mammoth real estate should not continue into 2015 and beyond. Here’s what I’m seeing and emphasizing;
- If the drought and lack of great ski conditions continues through this winter, many local businesses and property owners will be at breaking points. The “trust funder” businesses in town will be fine (there are plenty) but there are many marginal enterprises that have struggled to get to this winter. Two weeks of holiday business simply isn’t enough. More property owners that rely on nightly rental income to cover expenses will feel the squeeze and will consider liquidation. There is no snow in the 10-day forecast. And psychologically people want to ski on quality winter snow.
- The ~$1M property market should continue strong as buyers with that discretionary wealth continue to liquidate stock market gains and convert them to real property, and/or hedge anticipated inflation. And some are no doubt securing a refuge location in the isolation of the eastern Sierra (that seemed like a recurring theme in holiday discussions).
- The low end of the condominium and single-family markets will remain tight. Interest rates remain ridiculously low and local rents remain reasonably high. However, there are signs that an increasing amount of long-time owners are fed up with the accruing costs of owning older condos and are willing to sell-out at the higher values of today’s market. That is a trend worth watching.
- There is also an increasing amount of “throw in the towel sellers” who have been waiting for increased values and have negative equity. These are owners who must preserve their good credit (and can’t do a short sale, etc.) and have decided to liquidate and take the financial and/or mental loss. Most either purchased or re-financed in the mid-2000’s.
- More and more listings are properties that have been owned for less than five years. These sellers either didn’t find the right property, or didn’t find their anticipated “pop” in values, or didn’t find all the hoped-for rental income. Which leads to…
- The local hyperbole-pushing real estate agents will become even more enthusiastic; “the market is going higher“, “this will make a great rental property“, etc., etc. The fervency isn’t quite like 10 years ago, but many of the same actors are playing their parts. For some of them, their “investments” of 10 years ago are still driving their hopes that values skyrocket. The debt also drives their urgency to close deals (one holiday conversation with a fellow broker yielded “If property values would go up I could retire”). And many of the newer hot-shots haven’t even seen a real estate cycle. But as the local real estate transaction volume remains slower, the pushing will become louder. Caveat emptor…
Demographics shouldn’t impact much of the local market in 2015 but it will long-term, for those who missed my Real Estate Q&A in the New Year’s issue of The Sheet, The Changing Age Game.
Only seven sales, but… The sale of a 1 + loft / 2 bath unit at St. Moritz for $295,000. Whether intentional or not this was a flip. The seller purchased this as a short sale 18 months ago for $190,000. They left the original cabinets in the kitchen and baths but brought in slab granite counter tops. The showers were tiled, some hardwood flooring and new carpeting, furniture, TVs and decor. The recent handful of true flipper properties haven’t proven to be real lucrative from my back-of-the-envelope calculations. Here there would be ~$15K in HOA and taxes and ~$15K in transaction costs at the close on top of the improvements…
…But it once again proves that buyers will pay handsomely for “turn-key” properties and especially right before the holidays. And the sale of a nicely redone Bridges 2 bedroom / 2 bath at $515,000 is even more proof.
The REO 2 bedroom + loft / 3 bath town home at Mammoth Sierra Townhomes closed for $255,000. This might be a good buy if it weren’t for the 3-story wall just outside your front door. An interesting incurable defect for sure…
The last available Creekhouse (Snowcreek Phase 7) unit closed. Will Chadmar build more this summer? …And a nice residential lot on Ridgecrest closed for $200,000. Still good buys in that segment of the market.
Other Real Estate News
This was the first big winter holiday with our new internet service fully in place. I can’t say I experienced any slowdown during the day. But at night it seemed like there was a bit of a slow down. Maybe there was so much streaming of movies, or the uploading of the day’s Go Pro footage, that it was compromised. But regardless, I’m sure everyone enjoyed the new service… As for AT&T mobile device users; tons of lousy service complaints and actually no service at some points. My Verizon worked just fine.
Since my new office is near the new bowling alley on Chateau Road, I can tell you that Mammoth Rock “N” Bowl was packed during the holidays. The parking lot was more than full during most days. With cold temperatures and marginal ski conditions, this provided a new recreation outlet for many visitors. I’m sure they were grateful. And not a bad time to practice your golf swing either…
With “airline” or dynamic pricing becoming the new strategy to price and sell lift tickets, it was reported that the “walk-up” price for a lift ticket at Vail during this past holiday was $159.00. Wow. I hope the conditions were better than Mammoth. But if you were skiing at Vail and didn’t already have an Epic Pass, you might be the fool who deserved to be parted from his money.
While the police are in the spotlight nationally, both Mono County and Mammoth have new law enforcement heads. Most interesting is Ingrid Braun as Sheriff. She was elected back in summer and has now taken the office. She breaks the 100+ year tradition of a true “good old boy” Sheriff’s Department based in Bridgeport. She’s a former LAPD lieutenant with 21 years of experience. This is a BIG change. This will be interesting…
Mammoth Lakes PD’s new chief is a former Ventura SWAT Commander. Allen Davis, 51, recently took control of the department and says he “loves the mountains.” Hopefully he won’t be needing too much of his SWAT experience here in Mammoth…
Thanks for reading!
** Closed sales data is compiled from in-house files and public records.