A BIG Dump of Snow And More Blackouts!
Market Summary: January 6 — January 20
At the period’s end the condominium inventory is up 14 to 107. Many of the new listings are actually new to the market. There were a total of 20 new condo listings in the period, and none to contract. That included three new listings at The Lodges. This time last year there were 63 condos on the market. The Mammoth market saw 350 condo closings in 2018. The range was from $182,000 to $1,575,000. Of these sales, the average days-on-market (DOM) was 93 days. The median price was right at $400,000. Comparatively, in 2017 there were 410 closings with an average DOM of 118 days and the median price was $358,000.
Single Family Inventory
The inventory of single-family homes is even at 34. There were five (5) new homes brought to the market during the period but we have seen a couple of them before. This time last year there were 29 homes on the market. In 2018 the Mammoth market saw 79 residential closings with a range of $355,000 to $4,725,000. The average DOM was 176 days. The median selling price was $970,000. There were 31 homes selling over $1M and four over $2M. And compared to 2017; 90 residential closings with an average DOM of 183 days and a median price of $795,000. In 2017 there were 32 homes selling over $1M and that included 10 new Gray Bear homes. The high-end residential resale homes did very well in 2018, and there are a handful currently in escrow.
The total number of properties in “pending” (under contract) in Mammoth Lakes is up eight (8) to 47 at period’s end. Of the 47 properties in “pending,” there are 26 in “Active Under Contract” status (formerly “back-up”). The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is up five (5) to 70. It looks like the holiday period produced some sales. This time last year there were 50 and 61 properties in escrow respectively.
Market Updates and News
The busy holiday period pushed on for another week and finally cleared out after last weekend. This weekend marked the Martin Luther King weekend including blackout dates on the IKON Base pass. The different passes and subsequent blackout dates are certainly a curiosity in our local market. The true data and effect are not yet clearly known. So far it is all anecdotal. From the business (traffic) in town to the skiers on the Mountain, there does appear to be a “leveling” effect. But the big snow this past week brought a large crowd to town for the holiday weekend regardless. Last Friday was packed as all the Base pass holders had to get on the fresh snow before the blackout. And I heard more than one person say they “should have bought the full IKON Pass.” This year’s blackout dates are coinciding with attractive ski and snowboard conditions.
Interestingly, one barometer of anticipated business traffic is the page count of The Sheet. The page count of the local papers has always ebbed and flowed with what the local business people (the advertisers) think the tourist crowd is going to be like. This week’s issue of The Sheet is only 16 pages, which is relatively small. The advertising is concentrated on restaurants and bars. Either the local business people have enough business or they anticipated a smaller crowd in town. Eventually Mammoth’s marketing gurus and Alterra will generate some real data. And some of it is likely to reflect in next year’s IKON pricing.
The YotelPad vision is becoming clearer. New print marketing materials have been distributed to the various local brokerages and the exhibition and sales office has all of their large floor plan and “stacks” arrangement displays in place. Now we have a real good idea of what the individual rooms (“Cabins”) will look like, what the townhome “Domos” will look like, and how the whole project lays out including the communal areas.
Apparently the Planning Commission has requested the front elevation and hardscape to be somewhat “softer” in presentation so these minor architectural features may be sent back to the drawing board. Also, we can now see how the project will be built. The proposal is to build the parking garage/foundation as a “podium” of concrete and the above ground structure will be pre-fabricated units shipped in from elsewhere. This plan (in theory) should reduce not only building costs but the construction timeframe. Many of the interior finishes like cabinets and furniture are “built-in” to the pre-fabricated modules.
The estimates are the project can be completed in 18 months as opposed to the three years it took to build the Westin Monache. The last project that was built in this manner was the Aspen Village “rental” units that immediately face Old Mammoth Road (just past the Snowcreek Athletic Club). I recall that project experienced construction issues and delays because the units didn’t quite “fit” together as planned. Let’s hope the pre-fabricated process has improved since then. This may be the future and the solution to overcoming the expensive cost of construction in Mammoth, at least in the condo hotel realm. But at the proposed selling cost per square foot the project does still remains risky for the developer.
Meanwhile the agents at the YotelPad exhibition and sales office report strong interest in the project and expect that it will be completely sold-out prior to construction. Only time will tell.
The new Grocery Outlet is nearing their opening. The inside appears stocked with inventory and lots of minor detail are being attended to inside and out. Mammoth will soon have its much desired second grocery store. The visibility is so impressive that many visitors may never make it to VONS. And it will be interesting to see if it has any impact on VONS pricing in the local market. I hope the Outlet can keep the shelves stocked. That section of Old Mammoth Road may see more congestion than the old days of Grumpy’s volleyball tournaments. And it isa major step in the revitalization of the immediate area.
Before the big snow dump of last week the Ski Area was frantically making snow by the freestyle park and super pipe. The pipe has yet to open due to the lack of snow. Thankfully the big Gran Prix event in Mammoth comes late this year; March 4-9. The annual event is nationally televised (including live) on NBC and is one of the best marketing opportunities for Mammoth Mountain.
An interesting article in the January issue of UCLA Magazine caught my attention. From 1938 to 1949 there was a year-round outdoor ice rink in Westwood Village adjacent to campus. It was called the Tropical Ice Gardens. The rink could accommodate up to 2,000 skaters and 12,000 spectators. The rink was closed and demolished in 1949 for further expansion of the campus. Today, the UCLA men’s hockey team remains but is “almost entirely player-funded.” Interesting that something so substantial could come-and-go so quickly.
And someone cornered me the other day on the subject of affordable housing. He reminded me (we’ve both lived here for decades) that housing has always been tight here in Mammoth, and it used to be a “right of passage” to solve it for yourself. He said it has always been about “how badly do you want to live here.” And “there’s always been people living in their cars.”…I’ve thought about his comments, and he is right about it once being a right-of-passage.
The high sale of the period is an absolutely gorgeous Rosaasen built home in Starwood subdivision surrounded by the Sierra Star golf course. The odd thing is that it has sold three different times since 2012. The finish work is so extensive and impeccable it is hard to believe it could be replaced for the recent sales price.
The church that purchased the old movie theater on Old Mammoth Road closed on two more commercial condo units in the building. These units may allow for some day care operation as well. Good to see these units being put to good use.
Favorite New Listing For The Period
Other Real Estate News
The nightly rental business that has been so dominated and influenced by Airbnb the past few years appears to be going in many new and interesting directions. Industry leaders are amazed at the recent mergers, acquisitions and new partnerships in the industry. For instance, national company Vacasa purchased a large, long standing reservation company (Mammoth Premier) here in Mammoth two years ago. They have been actively soliciting for new rental units here in Mammoth and “guarantee” a $5,000 increase in revenue in the first year. But Vacasa is also busy acquiring larger companies in larger markets. And while they do utilize the Airbnb system and other online sources, the conjecture is they will eventually build their own platform. They just raised over $200 million in new funding.
There are other trends; the “direct booking” model continues to grow, and so does regional marketing. The direct booking concept aims to eliminate the fees renters and owners (or their management companies) are paying to Airbnb. These fees have grown substantially in the past coupe of years. Many individual owners who are capable of “active” management have developed their own marketing avenues (websites, etc) and are looking for quality rentals and not quantity. It is wear-and-tear versus net revenue and all balanced with the appropriate owner usage.
The regional marketing model that supports local rentals but doesn’t take a big bite out of the rental revenue is growing also. A website Calistays.comis a new one. These regional marketing systems are becoming popular in tourism dense areas. It is only a matter of time before a Mammoth/Eastern Sierra based entity goes in this direction. Many large property managers are removing their listings from the likes of Airbnb, HomeAway and Bookings.com. The #bookdirect message is growing.
I see it all becoming Who is going to do what and get compensated for it? And will the rental owners or the guests drive the direction? That is going to take time to sort out. Airbnb isn’t going away but I’m sure they are anxious to get their IPO completed. One thing noted in the Airbnb model is that the dynamic pricing strategy and their higher inventory is driving rental pricing down in lower demand periods. That isn’t necessarily making owners happy. And now Google is testing a new vacation rental platform and an acquisition may be in their future.
Meanwhile, another industry challenge and trend is how to resolve the “instant gratification” needs of the vacation rental guests. It has all come down to the “five minute response.” Renters want their issues resolved in short order, or else they are unhappy (and bad ratings are sure to follow). And Siri or Alexa probably won’t be able to come up with the answer. So there are new solutions to be developed.
One noted trend is to simplify the property, make it as “goof proof” as possible. High tech and complicated tech may not be the answer. But a property specific website might be; a site that easily points out the local restaurants, shops and stores, amenities and features, etc. but also has solid information about the property’s systems and available inventory and bedding options. These sites can also be the marketing site because booking direct is the future for many owners. The renter is now demanding more than pretty photos and a welcome basket. Thorough information will come to be expected. The industry hopes this direction will take some of the service load off of management — fewer calls about minutia.
And in the last month the battle between Airbnb and cities around the country has heated up. Airbnb and HomeAway were awarded a preliminary injunction against New York City and the City’s attempt to require the platforms to provide all owner data to the City to aid in enforcement. The ordinance was scheduled to go into effected on Feb. 2nd and was aiming primarily at controlling illegal rentals.
The New Orleans City Council recently voted unanimously to restrict short-term rentals outside of commercial areas essentially banning vacation rentals in most of the city. Detailed amendments will be drafted and voted on in the near future. The Los Angeles City Council has voted to limit short term rentals for a maximum of 120 days per year. They also added host requirements to adhere to codes including parking and guest conduct.
And property owners in South Lake Tahoe have won a temporary restraining order against Measure T, the ballot initiative that passed in November banning many vacation rentals in the city. The suit claims the Measure is unconstitutional and unenforceable.
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Thanks for reading!
** Closed sales data is compiled from in-house files and public records.