Mammoth Real Estate Sales Report December 21, 2014

Market Summary: December 7 – December 21

The Mammoth MLS is reporting 18 closings in Mammoth Lakes for the two week period ranging from a low of $160,000 to a high of $1,200,000. That is up 10 from the period before. There were three (3) REO/bank owned property closings and two (2) short sale closings. Of the 18 real estate sales, 16 were technically financeable properties and 10 were purchased with conventional financing. A healthy number of closings for the period but the rush to close before the holidays is over.

Hopefully everybody is happy. Believe it or not, this can be a very tense period. Some people just have to be in their new properties for the end-of-the-year holidays. If there are hangups, it can get ugly. Twelve of the 18 sales were condos under $425,000 and only two of those were condo hotel units.

Condominium Inventory

At the period’s end the condominium inventory was up two (2) to 136. This is now a slight trend and quite unusual in this market. The inventory historically moves down in late fall and winter. I don’t see any consistency in the new listings, they seem to be all over the board. But the market should pause now. The holidays aren’t typically a big real estate period here in Mammoth. People are here to have fun and enjoy. And properties that are on the market are often occupied. January is usually on the slow side too.

Single Family Inventory

The inventory of single-family homes settled up four (4) to 58. Again, this is not the time of year to see increasing inventory. And there a couple of new Hooper/Grey Bear homes being offered that aren’t in the MLS, so the inventory number is actually higher than that.

Pending Transactions

The total number of properties in “pending” (under contract) in Mammoth Lakes is down seven (7) to 47 at period’s end. Of the 47 properties in “pending,” six (6) are “contingent short sales” and 22 are in “back-up” status. The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is down 12 to 69.

Market Updates and News

The most important thing right now in Mammoth is the ski conditions and I can give a first hand report. The Ski Area has good coverage but not great coverage. The major runs around the Main Lodge are in good shape but the half-pipe isn’t rideable yet. They have simply had to focus the snowmaking on the critical access runs. The face runs of Chairs 3 and 5 have plenty of obstacles. The top had fresh powder on Thursday but there were plenty of obstacles. The east side of the Mountain was not open but there was an access trail down to Eagle. The main run down to Canyon was open only because of the tremendous snowmaking efforts.

With no snow in the forecast through the end of the year the holiday period is going to disappoint many anxious skiers and snowboarders. There will be too many riders on too few runs. The more bravado will go off into areas full of obstacles. Those areas will get “skied-off” and become even more hazardous. The hospital is sure to be busy through the period. Hopefully the Ski Area didn’t overhype the conditions. The “big” storm that hit California 10 days ago missed most of the eastern Sierra.

The big Ski Area “news” is that the Main Lodge land exchange was part of the miscellaneous “pork” included in the recent 1600+page National Defense Authorization Act bill approved by the Senate and signed by the President. Now things will get interesting. In the near future the ~2 year Environmental Impact Statement (EIS) process begins. And I see opportunity.

The property owners in Mammoth, the Ski Area’s paying customers, and the local residents were promised the extensions of the Village gondola in conjunction with Eagle Express (Chair 15) many years ago. The plan was for the two to merge somewhere above the top of Eagle Express. The new Eagle Express was actually built to accommodate the same gondola cars as the Village gondola. So Eagle becomes a gondola and rises up to meet and merge with the Village gondola and then a next leg up goes to an area around the termination of Chair 5. And maybe even a leg to the top of the Mountain.

Why is this so important? The Town’s General Plan and the Forest Service’s Master Plan goals for the Ski Area have long called for an equal amount of skiers (~8,000 at peak) entering the Mountain at each “portal.” The portals being Main Lodge, Canyon Lodge, Village and Eagle. The vehicle traffic to the Main Lodge is suppose to be reduced dramatically. The three eastern portals are inadequate serviced without this gondola extension. The skiers entering the Mountain at these portals need to get somewhere without two to three chair rides. The Village gondola is really “the gondola to nowhere.” The Ski Area simply hasn’t wanted to spend the money to finish modernizing the lift system and meeting the goals.

Also, the ultimate long term plan for the Main Lodge area once the land is privatized to to make it an exclusive/luxury area. One concept is to make all of the parking above Chair 2 pay parking. Some of the land included in the exchange is now used for parking. You can be sure that isn’t the long term plan.

The EIS process will allow for public comment. It will be opportune for all of the property owners, customers and citizens to have their say. The Eagle and Village property owners deserve the gondola extension. There could be a lawsuit. The EIS process is where the Sierra Club delayed the airport improvements for years. The gondola improvements need to be contingencies of the land exchange, not just more empty promises. This process is just beginning. There will certainly be more discussion to come.

I recently noticed that June Mountain is now being branded as “California’s Family Resort.” Sounds great. But the discrimination lawsuits are going to come (is anybody paying attention?) The real estate industry is constantly reminded (warned) that you can’t call a home “a great family home” or the like. Using the word “family” is discriminating against everybody who isn’t a family. (I know, it is part of out modern American ridiculousness, but…) I wonder how long it will take before somebody notices, or files a suit… Mr. Baumwohl must be on vacation.

A recent article in the World Property Journal reports that cycling (as in bicycle) tourism is a rapidly growing business, especially in Europe. And new real estate developments will be catering to them. Interesting: the European Cyclists Federation shows that 655,000 people are currently employed in some facet of the continent’s cycling industry AND that the average cycling tourist spends an average of $39 US dollars per day where the average car visitor spends just $7.30 US… Sounds like another opportunity Mammoth needs to pay attentions to.

And in case you missed it, my most recent foreclosure related column; Mammoth Foreclosures 2015 Zombies…

Noteworthy Sales

Two residential sales in The Trails for right around $1M each. These are large quality homes and one was a short sale. But it is ironic that this subdivision was originally going to be “affordable housing.” And after that, the original developer seeded the tract with small single story homes that were deemed affordable. But the $1M price range remains hot in the Mammoth market, but some would question if The Trails is the best place to put that kind of money. The subdivision really doesn’t have the “resort” qualities that most buyers are looking for. It is more like a local resident’s neighborhood, especially with the immediate proximity to the schools. But more and more second homeowners find it appealing. Interesting for sure…

Snowcreek continues to hold value, even the older units. A large unit on the fairway closed for $740,000 and a nicely located phase II 2+loft sold for $385,000.

Older units in nicely upgraded/remodeled condition continue to bring solid pricing. Right now, a prudently done remodel of an older condo can probably bring a small return on the investment. That isn’t always true in this market. Of course, right before the holidays is the perfect time to bring a property like that to market. Many buyers simply don’t have the time or energy to get involved and value (and will pay for) the “turn-key” condition.

Otherwise, no real appreciation showing in the balance of the condo sales.

Other Real Estate News

My position on the Mono County Property Tax Assessment Appeals Board can be enlightening and entertaining at points. As the current Chair, I have to run the meetings and be extra sharp as to what is really going on. The appeals that come to hearings (and the owners) from the north county are quite different from those from the south county. Mono County is like two different planets. With almost all appeals the property owner thinks (believes) that his/her property is worth considerably less than it is.

The owners from the north are usually quibbling over very little. I think they take their assessment more personal. One recent appeal was from a property owner who paid $48,000 for a vacant parcel and claimed that because of the poor drainage on the property that it may be close to worthless… BUT, he has the property listed for sale for near $250,000. When questioned about that he brassily responded “Well, I’m just looking for a sucker.”

Appeal hearings can also take you into odd areas of real estate knowledge. I would otherwise have no clue how to value fields of alfalfa. But sure enough that was the topic of a north county appeal. Now I know all I will ever need to know…

The appeals from south county have recently been dominated by an ongoing appeal by Mammoth Mountain over the values of the front desks and management offices in the Village and Juniper Springs condo hotel properties. This is an interesting appeal issue. Who knows how to really value these properties? It will end up as a compromise I’m sure. The methodology is subject to debate. These little pieces could have been just left as common area and the whole tax valuation issue would have never happened. But for some reason Intrawest gave them separate parcel identification and ownership. Maybe they thought that some time in the distant future when the management contracts expired that they could be sold off for big money? Nice option to have.

Meanwhile, we should be hearing appeals on the geothermal plants down off of Hwy. 395 in the coming months. I’m sure the room will be full of attorneys…

Merry Christmas and Happy New Year… or whatever you are celebrating…

Thanks for reading!

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