Hot, and In-and-Out Smoke, But Mammoth Hasn’t Been as Bad as Other Sierra Locations!
Market Summary: July 29 – August 12
At the period’s end the condominium inventory is up five (5) to 109. There were 17 new condo listings in the period and two (2) are already under contract and in escrow. There are 43 condos listed under $400,000 but the inventory is thin for the buyer who wants to find a good one with two sleeping areas. That inventory does include four (4) Westin units and nine (9) 1-bedroom units at the Summit. In the past 18 months the smaller units have been popular with investors looking for nightly rental properties. Values have certainly risen. There should be plenty of price discovery between now and the end of the year. The condo inventory has all the signs of peaking. We’ll see if the serious buyers recognize that.
Single Family Inventory
The inventory of single-family homes is even at 53. Again, we may be at the cyclical peak of inventory for homes. The two least expensive homes on the market are almost uninhabitable. In the past week there are visible signs of “showing” life. I was out showing the low-end homes in the past few days and I was being chased by another agent for a single, available key to the property (why a listing agent would only have one key is besides me). We did write an offer so the inventory may start moving. There are now four offers on that property. There were several price reductions during the period so some sellers (or their agents) are getting antsy. But again, it appears we have moved from the very active first half of 2018 into a more traditional selling cycle.
The total number of properties in “pending” (under contract) in Mammoth Lakes is down five (5) to 59 at period’s end. Of the 59 properties in “pending,” there are 39 in “Active Under Contract” status (formerly “back-up”). The total number of pendings in the aggregate Mammoth MLS (which includes outlying areas) is up seven (7) at 94. There has been some excellent high-end business being conducted but the actual sales volume and showing volume in the past 45 days has been slower but more in line with history.
Market Updates and News
The Bluesapalooza week and event has come and gone through the period. It looked to be about the same success as last year but the smoke from forest fires has definitely subdued summer business. We won’t know to what extent until all the sales tax and bed tax numbers come in. I was in Reno and north Lake Tahoe last week and it was just as bad, if not worse, up there and everywhere in between. The drive south was all smoke. Mammoth’s air quality changes during the days based on air flow. Some days it hasn’t been that bad but there have been some bad periods. Mammoth’s elevation and the “funnel” that is the Mammoth Pass certainly creates changing air flows. The most immediate fires (Lions and Ferguson) to Mammoth Lakes are coming under greater containment but they aren’t likely to be truly out until there is some snow or significant rain.
The construction at Canyon Lodge now has the entire parking lot closed off as a construction zone. Looks like this years’s improvements will be more than just a new escalator. One of my clients will be doing some sub-contracting work on the project and he said the out-of-town general contractor is “extremely professional” and they desire to work with as many local sub-contractors as possible…. The new Euro-style climbing course (Via Ferrata) on the Roger’s Ridge area of the Ski Area is now open. And the new “Mega” zip line is scheduled to open in fall. I’m wondering if the zip line will be open in winter??…Ultimately, it is great to see capital improvements happening. Let’s hope it continues.
The proliferation of electric and pedal-assist bikes has created its own calamities. Many riders are riding much faster than normal, much to the angst of regular vehicle traffic and others. Some riders are simply unpredictable and many are clearly a danger to themselves. Who knows how much they’re had to drink. And the “downhillers” on Lake Mary Road (they didn’t ride up) are a threat too. I recently watched one middle-aged man flying down LMR without a helmet; even worse, he had an infant in the rear child’s seat and she didn’t have a helmet on either! Mammoth Hospital’s ad campaign all summer has been “Wear a Helmet! We can fix everything else.”
The Ice Rink/MUF took another turn during the period. The Town Council basically approved a new “half assed” (a hockey fan’s description) version of the facility. They agreed by a 3-1-1 vote to pursue a scaled down version, most likely the “rink and roof” version without the MUF portion. They directed staff to come back with a new plan including a revised entry, etc.. Still unresolved is the restroom and locker room arrangement. Apparently the fans and teams don’t make a good mix (and will there be a transgender locker room?). The cost of the new facility should be $13 million and in Parks & Rec. lingo it is “fully programmable”. Nobody on the Town staff seems to have any idea of how much the facility will cost to operate. Managing expenses doesn’t seem to be a Town priority.
The Staff Report did highlight something that hasn’t been there in the past or I missed. The facility is now particularly important for the “underserved segments” of the community. Approximately 60% of the students in Mammoth are classified as “socio-economically disadvantaged” and the facility is needed to address that inequality. I guess anybody opposed to the facility will now be labeled a racist? But do we really need a $25 million structure to enrich these kids for three months with “programs?” Isn’t there a more logical and cost effective strategy? We dolive in the middle of vast public lands and there are plenty of facilities already in place. We live in a joint-use, multi-use community with limited resources.
But I have a new question. When the LA Kings want ice time in the summer and they propose to displace the “socio-economically disadvantaged” kids (I’m sure that gets a laugh from out-of-towners) in the community, what is going to happen?? Who gets priority? I see another infamous Town lawsuit. Personally, I see the ice skating crowd as the elitists in the community (ice skating was some privileged-kid luxury when I was kid). So now the Ice Rink/MUF is likely to become an elitist versus socio-economic disadvantaged debate.
And it continues to amaze how far down the rabbit hole the Town will go to “save” $1 million over the next 25 years ( $40,000 (lease) X 25). Even worse, the Town can’t even keep the storm drains cleared during and around heavy rain events. How do they think they can adequately manage this facility?
….So to preserve sanity, I have decided I need to take the “new Mammoth attitude” about this hell-bent project. So first of all, I’ll take the greedy/self interested approach. I have two properties within close proximity of this site. I believe the ice rink will inherently improve the values (kind of like being in the Village). So not only will I support the project, I will push for the expenditure of increased dollars for more and better improvements and amenities. Who cares if the community can’t afford it as long as my property values go up. Riiiight? The pervasive attitude seems to be “if I can profit from it or get some big ego stroke, let’s go for it.”
Secondly, I will abandon the community’s attempt over the past 35 years of incorporation to resolve the hodge-podge planning in the downtown area (so much for the “giant eraser”). Placing this facility in this location and away from the IP (Institution Public) zone and the schools will continue the poor planning that makes Mammoth Lakes so endearing (and dysfunctional). And forget any real Main St. revitalization, the Town has spoken; long live poor planning!
Thirdly, who cares about the critical environments and our natural resources? All in the name of “progress” and becoming a “world class resort.” Let’s just try to pollute Mammoth Creek as much as possible, after all it just flows down into Crowley Lake and eventually Los Angeles. Who cares? Water flows down hill. The Town must think they deserve it. The new “half assed” plan will certainly dismiss the need for any safeguards. They can just cut those out of the plan. The extra restroom will be far more important.
There, I feel so much better now that I have adopted the new Mammoth attitude.
A 2 bedroom / 2 bath at Lincoln House closed for $659,000. The Village condo hotel units have been strong performers in the last six months — both the 2 bedroom and 1 bedroom units. The revenues have been strong the last two years. But they are still short of the 2006 values.
One of the last few small GreyBear homes closed for $1,180,000. So far no resales have shown up in this subdivision. When they do, I expect they will sell quickly.
A vacant lot sold in The Trails for $205,000. There are some decent vacant lots in the market but it has been a slow part of the market this year.
A fully remodeled 2 bedroom + loft / 2 bath in Summit phase I sold for $625,000. This is close to Eagle Express. There continues to be strong appetite for highly renovated units. The work is done!! And ready to rent.
Favorite New Listing For The Period!
Other Real Estate News
Zillow continues to report some interesting data points, but one recent one really caught my attention. Sometimes real estate agents forget that this is a business. It isn’t an athletic event to attain the top spot or the gold medal. This is a concept I have attempted to instill in the dozens of agents that have worked under my broker’s license. The old “it isn’t what you make, it is what you keep.” Being in the real estate brokerage/sales business is indeed a business and needs to be run like a business to survive (or else you have to have trust fund).
So Zillow recently reported that they had just slightly under $1.1 billion in revenue for 2017. And 71% of their revenue came from their premier agent program. So last year real estate agents paid $781 million to be “premier agents” on Zillow’s website so they can tout all of their 5-star reviews and generate leads from the public who really believe all the reviews. That is just astonishing to me.
Many of these same agents are likely to be ones who spend vast amounts on printing and postage to solicit sellers (Mammoth homeowners get barraged with mail from a variety of agents). Some spent thousands per month. Or thousands on a quarterly mailing. Many of these are the same agents are driving expensive leased vehicles and justify it because they can “write it off.”
So the next time you talk to a Zillow premier agent, think about asking them how much they are spending on the placement and advertising. I’m sure they will tell it is well worth it. For me, I prefer to stay off hamster wheels, especially ones that cost $781 million.
I was recently reading a newsletter from a national tax consultant and he had a section “Plan Your Travel for a Tax Write-Off.” His suggestion #5 is “Check on your rental property.” He says he has repeatedly recommended purchasing rentals in places you visit (Ikon Pass locations??). This is certainly an added perk to owning a nightly rental condo in a place like Mammoth. Many of the “visits” can be accounted for “maintenance days” but also the cost of travel can be expensed as well. And I’m guessing that after many second homeowners look at their 2018 tax returns they will be seriously considering turning their second homes into nightly rentals.
And lastly, I’m not sure if MMSA’s new ownership Alterra Mountain Company likes to over-hype things, or they simply think they have truly elevated Mammoth, or what ….? But on their website they have Mammoth Mountain’s elevationat 11,353. As long as I have been here it has been 11,053. Maybe the magma dome under the Mountain has recently pushed it up another 300 feet while nobody noticed…..
Thanks for reading!