Market Summary: June 30 – July 14
The Mammoth MLS is reporting 14 closings in Mammoth Lakes for the period ranging from a low of $140,000 to a high of $691,500. The sales data reports only one REO/bank owned property closing and only one short sale closing. The REO lull is certainly upon us, and maybe short sales too. This office has been handling 20 to 40 REO assignments consistently for the past 5+ years and is down to less than a handful. But the word on the “industry” street is that the activity will resume in the future, but when and how many is yet to be seen. We’ll enjoy the respite for now and stay focused on “regular” real estate business.
At the period’s end there are 114 condominiums listed for sale in Mammoth Lakes. That is seven (7) MORE than two weeks go. The condo market needs more inventory. It is seriously depleted in some segments. But so far, most buyers appear unwilling to pay more than recent comparable sales in those segments that are thin on availability.
Single Family Inventory
The inventory of single-family homes increased slightly again (by two) to 55. There are still eight (8) single-family homes listed under $500,000 including four “A” frame or gambrel-style homes. We are beginning to see some price reductions in this segment; “the market has spoken.”
Residential Lot Inventory
Residential lot sales have been more active the past few months than in the past few years. The activity is being driven by a combination of contractor/”spec” builders and a large independent investor purchasing for long term hold (I wonder what he knows that we don’t know?).
The total number of properties in “pending” (under contract) in Mammoth Lakes decreased by four (4) to 68. Of the 68 properties in “pending,” 10 are “contingent short sales” and 20 are in “back-up” status. “Back-up” status continues to be the local agent’s favorite strategy to have potential buyers call about listing even though they are in escrow. The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) decreased by two (2) to 94. The sales numbers are showing what we would normally expect for the Mammoth region for this time of year; lower sales numbers-this is not typically the “hot” selling season.
Market Updates and News
The 4th of July period was packed as expected here in Mammoth. The Jazz Jubilee week and weekend appeared light. The Jazz Jubilee may demographically be on the slow decline. We have witnessed the primary crowd age and fade. This event was massive in the past, and for many years, perhaps the biggest of the summer. The talent and energy of the bands has not changed, they are still exceptional. But today’s visitors, the ones who are paying for accommodations, the passes, cocktails, wine and dinner, are geared towards a different musical genre. The long-standing organizers of the Jazz Jubilee are likely losing steam too. The event may live-on, but my guess it will devolve into a minor summer event and share a weekend with a more major event. We’ll see.
The biggest question on the real estate front is; how will higher interest rates affect Mammoth values and activity? The past five years have seen a significant volume of cash buyers in this marketplace. I don’t have the statistics, but I would say we have had a higher percentage of cash buyers than most markets in California during the period. And that is with no significant number of purchases by institutional or “foreign” buyers. But then again, if you understand the local market and the typical, more affluent buyer, that would make sense. So higher interest rates may have no affect at all. And after all they are still quite low. It may mean that cash buyers take an even stronger position in competitive bid scenarios.
There do appear to be some “flippers” in the market, or recent buyers who are unhappy with their recent purchases. Two condos and a low-end home have reappeared on the market, all having closed escrow within the last 12 months. And of course, they are listed at significantly higher prices. Just wait until the unknowing (potential) buyers ask their agents for the comparable sales in the past year, and there they are. Have the prices really gone up that much?
Mammoth can finally boast of having a true “entry statement.” The Mammoth Gateway sign dedication occurred last Friday. These massive new signs at the entry to town are truly something for many to be proud of. This took tremendous effort, but project organizer Elizabeth Tenney surely deserves the credit for the vision, effort, and guts to get the project completed.
Besides raising the cash and the volunteers for the design and construction, the project required the approvals and cooperation of nearly 20 government agencies!! Imagine coordinating and accomplishing that! The new monument signs were designed to last “well beyond 100 years” and include quotes from John Muir. And all for this was accomplished while the Town wrangled with endless controversies and negative press.
My Real Estate column in last week’s The Sheet about escaped bed tax was well received by many… and according to local media was mentioned numerous times during the public comment phase of the Town Council’s “policy priorities” meetings on July 8 and 9. Priority #2 (of the “Top 5”) ended up being “generating revenue” to include “educating property owners and renters of all regulations and laws in connection with bed tax.”
Hmmmm… I’m not sure that would have been a priority in the absence of the column the weekend before, but they made a good decision. After thinking about the column and the tongue-in-cheek comments about taxing everything that moves up Hwy. 203, I realized that most of our So Cal clientele frequently drive on toll roads and don’t think twice about the cost for the convenience…
Not many exciting sales to report, and only one sale over $500,000. But two sales in Snowcreek display that selling prices are going up… and going down. A 3 + loft / 3 bath “D plan” in Phase III closed for $460,000 (a high price in my mind). I hope the buyer likes stairs, “this unit has four levels.” I showed this unit many times over the past year and nobody I showed it to liked it. In fact, I can’t remember any of my potential buyers liking this floorplan.
Even worse; right across the parking lot you can have a similar floorplan without all the stairs for the same price, and the creekside setting and view in the backyard are stunning (and certainly not a parking lot). On the flip side, a Phase 5 3 bedroom / 3 bath 1-car garage townhome closed for $479,500. That’s a good value.
And as I said before, single family lots continue to sell; some to spec building contractors looking to build in the near future and several to an individual investor. Even some of the “expensive-to-build” upsloping lots are selling. Buyer beware.
Other Real Estate News
The Dog Days of summer are settling in. Mammoth has already been through a considerable volume of tourism and the summer is still young. The VONS remodel is looking good but is tiring for everybody. The weekends between now and Labor Day are filled with special events including those centered around music and alcohol that have become incredibly popular. The big bike race revival will occur after Labor Day. With increased tourism will come increased real estate lookers and the market will accelerate into the traditionally busy fall season (“the anticipation of winter”).
The low end of all real estate segments here in Mammoth are lean on inventory. Especially lacking are good condos under $200K and in the $300K neighborhood. Those are the staple of the market. And quality homes under $500K. But just in the past couple of weeks we have seen new sellers in the market. The media is reporting that some markets in So Cal are “cooling.”
Interest rate changes are destined to change the market psychology. But how is still questionable. And inevitably the banks will once again make moves on the distressed/non-perfoming properties (there are many owners in “limbo”). I’m looking forward to the next two months of summer.
Thanks for reading!
** Closed sales data is compiled from in-house files and public records.