Market Summary: March 1 – March 15
The Mammoth MLS is reporting 14 closings in Mammoth Lakes for the two week period ranging from a low of $170,000 to a high of $2,100,000. That is down six (6) from the previous period. Of the 14 closings, 12 were financeable properties and 11 were in fact financed. There were no REO/bank owned property closings and no short sale closings reported. And like the previous period, the Mammoth real estate market remains busy and healthy despite the marginal ski conditions. My newsletter of one year ago reported 12 closings for the similar period.
At the period’s end the condominium inventory is up four (4) to 158. There were 14 brand new condo listings during the period. There are some concentrations of listings in certain projects; 10 units in Juniper Springs Lodge, 8 units in the Westin Monache, 8 units in Snowcreek Phase 5, 7 units in The Lodges and 7 at Seasons Four. This time last year there were 97 condos in the available inventory.
Single Family Inventory
The inventory of single-family homes is up two (2) to 51. There are several homes being “offered” in John Hooper’s new Gray Bear subdivision that are not in the MLS. These are new to-be-built homes along the the 8th hole of the Sierra Star golf course. The setting is especially nice because the fairways all come together creating lovely open space and southern mountain views. There are several reservations already. This time last year there were 45 homes on the market.
The total number of properties in “pending” (under contract) in Mammoth Lakes is down five (5) to 57 at period’s end. Of the 57 properties in “pending,” eight (8) are “contingent short sales” and 33 are in “back-up” status. The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is down two (2) to 75. This time last year there were 48 properties pending in Mammoth and 75 in the total Mammoth MLS.
Market Updates and News
The good/bad weather continues to dominate. The weather has been beautiful but not for those who want better ski conditions and snowpack/water on the mountain ranges. The Ski Area received a nice shot of snow two weekends ago and cold temperatures hung around for a few days. This provided several days of winter-type snow conditions that were plenty fun. I even skied three days in a row. But the warm weather persisted and (thin) spring-like conditions have returned. The Town is reported a 68% booking level for this past weekend. The spring break weeks are upon us and the snowmakers will be doing their best to keep it reasonable. There is snow in this week’s forecast on the Mountain’s website. Let’s hope…
The Mammoth Times is reporting that despite the compromised ski conditions the Town’s bed tax revenue is up significantly over last year and actually ahead of projections. But last year was bad and the timing of this year’s snow storms has helped. Others are crediting the value of social media to let skiers and snowboarders know the conditions are fun despite the low snow totals. The Town is also reporting that the airline flights are performing reasonably well considering the snow conditions. So we may not have any water this summer but there will be a few bucks in the bank.
But Mammoth is not alone. The ski industry is reporting that dozens of ski areas in the west are simply closed or are on the brink of closing. Even Whistler/Blackcomb is reporting plenty of mud at the base of the ski area. The main runs at Heavenly Valley are apparently in pretty good condition due to advanced snow making capability and technology installed by owner Vail Resorts. So for now snowmaking is a critical asset, until we run out of water.
The ski industry also just released their plans for next season’s ski passes and there are some interesting changes. Mammoth will offer the MVP this spring for $689 with $100 of resort credit (down from the $200 credit last year). The Vail Epic pass is $769. Both these passes are fully unrestricted. But while Mammoth doesn’t appear to be pushing restricted passes, the others are doing all sorts of mixing and matching.
Vail is offering a “local’s pass” which blocks out the major holidays for a $200 discount. They are also offering 4-day and 7-day passes. Vail Resorts is also offering a Tahoe Pass and Tahoe Local pass for usage at Heavenly, Northstar and Kirkwood with options to ski a couple of days at Vail’s other resorts. Meanwhile, the Mountain Collective pass, which includes Mammoth, has added Sun Valley. But it is restricted to 2 days at each resort. All interesting stuff. If I could manage my life better I could see having a Mammoth MVP and an Epic pass…
Last weekend I attended the massive Fred Hall fishing show in Long Beach and Mammoth Lakes and Mono County have never been more largely represented. Twenty-five years ago I manned the Mammoth Lakes booth and I can tell you it is exhausting. This year the Mammoth booth was bigger than ever but there was a separate display with a giant trout and rod-and-reel with the Mammoth logo behind it. People (and lots of kids) were enthusiastically “playing” the big trout while family members were snapping photos. Nice marketing efforts. I’m sure we haven’t seen the end of that big trout.
One interesting sidebar to the Round Fire that destroyed the homes of many local residents; large display advertisements in the local newspapers for law firms that represent victims of similar fires. Besides helping victims work though all of the insurance issues, one firm advertises that it has successfully sued public utilities and won a large settlements. The Round Fire allegedly started when electric lines were blown down and eventually ignited dry brush. Meanwhile, the local public outpouring for the victims has been substantial and impressive.
Mortgage financing (as opposed to paying cash) for condo purchases appears to be more popular but it certainly is becoming more tenuous. The purchase agreement forms we use were revised only a few months ago and they pushed the “default” loan contingency period form 17 days to 21 days. I’m going to be asking for 30 days in the future. Even when the buyers/borrowers are diligent and qualified it just takes more time. And then the listing agents get unrealistically pushy to remove the loan contingency (it will come back to bite them). Everybody just needs to be a little more patient. Shades of the late 1980’s. But then again some agents haven’t seen this part of the cycle before…
Another growing problem in Mammoth is (once again) the “condo hotel” classification of certain condo projects. Some of the “project approvals” for certain projects are now expiring and the questions (on the HOA certification) and answers have changed. One project where I closed two condo sales with loans some 15 months ago recently lost their approval and there will be no more loans available there until that is rectified. And it may not be rectified. The inability to get loans in these projects hurts values, especially if an increasing number of buyers are looking for loans.
Nine (9) of the 14 closings in the period were condo sales under $425,000. So the lower end of the condo market remians the “meat and potatoes” of the Mammoth real estate market. And likewise, the high sale of the period was a high end home near the Village… very consistent with the sales of the past year.
Snowcreek Phase 5 is really standing out. Yes, there are eight (8) units currently on the market in this project but there are just under 300 units total. But recent sales have showed a strong upward valuation, except one interesting one. In the fall of 2013 a very nicely upgraded 2 bedroom / 2 bath town home was marketed in Phase 5; nearly $100K or more in tasteful remodeling. The unit has nice views. The price was high. It was listed at $589,000 and we thought it was probably worth around $515,000. It ended up closing for $580,000 in December of 2013. It recently came back to the market after the owners purchased a newer and larger property. This time it sold for $500,000. Certainly not reflective of the upward trend we are seeing in Phase 5.
One of the best single family homes on the market the past few months with a great location near Eagle Base closed at $675,000.
The older duplex at 112 Manzanita closed for $372,500 after a multiple-offer scenario. This is two small 2 bedrooms / 2 baths units with four single garages and a minimal laundry room. These historic duplexes have been a hot commodity since 2011.
Other Real Estate News
I had some interesting comments from readers following the reprinting of a blog post on customer service from years ago. They all reaffirmed that MMSA needs help. The sad thing is that I wrote that eight years ago and nothing has changed, and the service levels may be worse…
With all of the hoopla about potential Mammoth hotel developments with significant timeshare components, I got to thinking about what it would take to make a successful timeshare project here in Mammoth. Timeshares and fractional ownership have been a true “bust” in Mammoth’s past. So here are some simple, initial thoughts;
Assuming the developer understands the real demand is in winter, most winter users like being impromptu to take advantage of optimal snow conditions. It is the “powder” mindset. So having “set” weeks or periods doesn’t work well for them. Having some built-in flexibility would be critical to a high level of success here in Mammoth.
The timeshares would have to be affordable. People with real money to spend buy the assortment of luxury homes and condos. Timshares are about affordability. Traditional timeshares are burdened with huge front-end marketing costs. Streamlining these costs with online marketing and sales could reap more serious buyers. Buyers of Mammoth timeshares don’t need free breakfast or “tours.”
The timeshares need to be marketed to Millennial buyers who desire smaller personal space and larger social/common area space with “shared” components.
Timeshares also need to compete with the private owners marketing on the HomeAway.com websites and AirBnB. This may be the biggest challenge yet. Maybe the answer is for the developer to maintain a certain amount of timeshare units to market on the likes of VRBO and AirBnB to “introduce” the timeshare units to potential buyers.
…It looks like there may be a timeshare push in Mammoth’s immediate future. I’ll give this some more thought. Maybe it will become a full column.
Thanks for reading!