Do you want to know what’s going on in Mammoth???

* This weekend (August 28th and 29th) is the Mammoth Reggae Fest here in The Village at Mammoth.  If you’re in town you should definitely check it out.

* Saturday, August 29th, is the Ezakimak Bike/Run Challenge (Kamikaze spelled backwards) where competitors can run or bike from Main Lodge up to the Summit of Mammoth Mountain under a full moon…The full moon Summit Party will take place at The Summit (11,053 feet…you better acclimate!) from 6:30-9:30…come on out and enjoy the full moon!

* Labor Day Weekend will be host to Mammoth’s Rock ‘N Rye festival, again, in The Village at Mammoth.  Music, food, beverages and even a mechanical bull!

Mountain biking is still fun with all the new features that MMSA installs each year.  And even the lesser known free trails are in good shape (Dennis rode the Mountain View trail yesterday and it was in better shape than Downtown).

And why not close out the summer with a relaxing float on a pontoon boat on Lake Mary (760) 934-5353, Convict Lake (760) 934-3800 or June Lake (760) 648-7726.  (If out on Convict, be sure to check out the rope swing just a few hundred yards from the marina at the tall, dead-looking tree).  The waters are warm!

After weeks of smoky skies from the plethora of wildfires burning throughout California, we are finally getting back to our beautiful blue skies and stunning mountain views here in Mammoth.  It has been an amazing summer here in Mammoth and it’s not over yet.

But Winter is JUST around the corner.  Reports of El Niño and possible record precipitation are getting us excited here in Mammoth.  We shall see what the future brings, but so far it is looking like we will finally get some much needed water (in the way of feet of snow!).

The Mammoth real estate market has been fairly steady, but prices, in general, seemed to have flattened a bit.  We currently have 70 single family homes on the market here in Mammoth, ranging in price from $349,000 to $6,500,000 (median price is about $960,000 and average list price is about $1,300,000).  We also have 200 condos currently on the market ranging in price from $119,000 to $1,400,000 (median price is about $340,000 and average is about $425,000).

We typically experience a little buying spree after Labor Day from those of you who want to get into a place before Thanksgiving, so beat the rush and have us help you wade through our high inventory.  Feel free to contact us for more information regarding real estate here in Mammoth.

-Tara P. & Dennis C.

JSL Now Allows Pets! … and Town changes addresses to a few complexes

As of January 2015, the Juniper Springs Lodge owners association voted to allow pets at this ski-in / ski-out condo-hotel next to Eagle Lodge at Mammoth Mountain Ski Area.  JSL was well known for a long time to be the only complex in Mammoth Lakes to prohibit pets on the premises.

The new pet policy, however, only applies to homeowners; renters are still prohibited from bringing their pets.  And owners’ pets are only allowed inside the condo units and in the common areas for entrance and exit from the unit only.  They are also not allowed in elevators (must use the stairwells only) and not allowed out on the pool deck.

But this is great news for those buyers who have not purchased in JSL because of this policy.  And it is in-line with Mammoth’s overall pet-friendliness.  (Now if we could only get conventional financing back in to condo-hotels like JSL, Village and Westin!)

New Street addresses for 5 Condo Complexes

In other news, the Town of Mammoth Lakes has changed the street addresses for a few condo complexes (most of them located on or near Meadow Lane) in the interest of public safety and to “make it easier for the public to locate a property within the Town of Mammoth Lakes” (ordinance 2013-47).

Here are the condo complexes affected:

Many other condo complex addresses were changed a few years ago (i.e. many at Snowcreek). Feel free to reach out to us if you have a question about the address of your complex.

-Dennis C. & Tara P.

CONDOS STALLING

Looking at a graph of $/sqft for condos sold in Mammoth Lakes since late 2011, we first see the dip down to the bottom of our recent real estate market in 2012, then an increase in 2013 that we all felt and enjoyed, and then a stalling out (and even a little decrease in Q2 2015) of prices to our current market.

Condos

When prices were increasing in 2013, it encouraged many sellers to put their properties on the market and to choose list prices that were ahead of the curve, thinking that prices would eventually catch up to them.

However, it may have backfired and soured the taste of many buyers.  In addition, the fourth year of our drought and subpar ski conditions may have put the brakes on our local real estate recovery.  It will be interesting to see if the current trend of decreasing $/sqft continues or not.

Caveats: Price per square foot is not always the best indicator of value, as there is a wide range of values.  However, when we separate out Intrawest properties (often 80% higher $/sqft) from non-Intrawest properties, we still see the same trend.  But if we break it down even further by area of town, we see that The Village, Snowcreek, golf course properties and Canyon Lodge properties are not declining in $/sqft and are actually increasing.

The other areas of town (main street, Old Mammoth, and surprisingly, Juniper Springs Resort), all peaked in 2014 and have decreased since then.  There have been a few short sales in Juniper Springs Lodge lately that may be contributing to this phenomenon.

 HOMES INCREASED SINCE 2012, BUT NOW AT SLOWER PACE

Tn the single family home market, average price per square foot has increased among all price segments up to $2M (see graph).  However, the rate of increases (except for the low end of the price spectrum) has been slowing since the rapid increase felt from 2012 to 2013.

$/sqft Homes – Jul 2015

Why?  Again, we believe it is due to the subpar ski conditions at Mammoth Mountain for the past four years.  With El Nino currently in effect this summer, everyone is hopeful that this trend will reverse.

Overall, the real estate market in Mammoth Lakes and surrounding areas has been relatively flat for the last three quarters. Prices have not changed much in the condo segment and neither Buyers nor Sellers have much more negotiating power than the other.

IS IT A BUYERS’ MARKET … OR A SELLERS’ MARKET?

It is neither clearly a Buyers’ market nor a Sellers’ market. When it is one or the other, negotiations tend to go more smoothly…

In a Sellers’ market, there are fewer properties for sale (supply) to meet the demand of a larger number of buyers.  Therefore, buyers tend to meet sellers’ demands on the price and terms of a sale.   In a strong Sellers’ market, you hear about multiple offers and sales prices going for more than the asking price.  And if buyers dare to ask seller to make any repairs, they are often left holding the bag and responsible for fixing things after they own the property. And if an appraisal comes in low, the buyers often accept it (unwillingly) and forced to pony up more of a down payment.

In a Buyers’ market, there is an oversupply of properties on the market and sellers are happy to receive an offer.  Sellers will usually come down lower in price and be more agreeable when negotiating repairs.

But when it is neither, like it is right now, we are seeing it take longer to consummate a deal, more counter offers (two to three), not too many multiple offers, and tougher/longer negotiations on repairs.  Sometimes we see standoffs between buyers and sellers; buyers think they should be catered to and sellers think they don’t need to cater to the buyers.  Bluffs are called and one side usually gives in a little bit and things can move forward.

Examples: Recently, a set of buyers made an offer at about 90% of the asking price on a house.  The seller countered back by coming down to 98.4% of his asking price.  The buyers came up a bit in price and then negotiations stalled.  The seller did not budge any more.  Eventually, the buyers came up to the seller’s price and are now happily in the home.

However, at the same time in another transaction, the opposite happened.  Buyers offered 90% of asking price.  Sellers came down less than 1% and then negotiations stalled.  Buyers waited for about two weeks and then tried again at 95%. The sellers took some time to think about it (and realized there was a chance they would not get any other offers), and came all the way down to meet the buyers’s price.

The Edge Goes To… If we had to choose, Mammoth has most recently been in a slightly Sellers’ market. One way this manifests is the average sales price as a percentage of a property’s most recent list price. This number has crept upwards for Condos from 96.3% in 2014 to 96.7% in recent months (and up from 95% since the bottom of our recent market in 2012).

Buyers were coming in with offers around to 90% of list price in 2014 and ending up at 95-96% of list price.  Lately, most buyers (other than the ones in the example above!) are coming in a little stronger knowing that sellers are not entertaining ‘lowball’ offers anymore.

When negotiating repairs, buyers are asking for more than they know will get agreed to.  On average, Sellers are agreeing to just under half of what buyers are asking for.  And they are pushing the responsibility of woodstove insert conversion (new Town of Mammoth Lakes ordinance as of 2013) onto the buyers.

Average Days on Market for Sold Condos

In addition, condos are selling faster.  Average days on market until escrow gets opened is 77 days in the first half of 2015 versus 110 days in 2014.

Why are we not seeing the crazed Sellers’ market conditions that exist in other California markets, like Santa Monica, Newport Beach and The Bay Area, where prices are above where they were at the last bubble in 2005-06?  Maybe because those other areas are fundamentally experiencing an increase in demand from foreign investors and an improvement in job markets.  And because Mammoth has been affected by the current four year drought that has produced subpar ski conditions, which have weighed on buyers’ decisions whether or not to invest in a ski property.

How long will this slight edge go to Sellers?  Well, it can depend on several factors, like interest rates (if they rise like they are supposed to, it may force sellers to become a little more flexible in order to accommodate the decreasing buying power of buyers) and inventory (see our blog post on Patterns in Inventory).

PATTERNS IN INVENTORY

It has been a tenet of our Mammoth Lakes real estate market that inventory (number of condos and homes for sale) in Mammoth Lakes increases in late spring and decreases in the fall.

Increase in Spring: Inventory increases after winter because (1) owners of condo rental units do not make as much income in the spring/summer/fall as they do in winter, so if they want to sell, they figure they will do it when rental income slows down, and (2) single family homes tend to show better in the summer (and you can actually inspect the grounds and landscaping now that they are not underneath snow).

Decrease in Fall: Inventory then declines in the fall when (1) rental owners who have been unable to sell decide to take their units off the market and rent for another winter, and (2) there is usually a mini buying spree around Labor Day as buyers decide to stop renting and want to spend Thanksgiving in their new vacation place.

This pattern had not been steady during the wild market upswing of 2003-2006 nor the downswing in 2007-2010, probably because larger market forces (easy money during the ‘bubble’ and the subsequent sobering burst of the bubble) were overriding this seasonal pattern.  But from 2010 – 2015, the spike and valleys of our inventory has read like the heartbeats of an EKG (see graph).

The graph plots number of properties for sale, the average Days on Market (DOM), and the difference between the two.  When a bunch of properties come on the market at the same time, the overall average DOM (the blue line) goes down.  And then, when they sit for a long time, the DOM starts creeping back up.  A rapid succession of new listings (inventory…the green line) show up as a spike on the graph when one calculates the difference between inventory and average DOM (“Difference” is the maroon line).  When the difference is high, it can depict “lots of fresh listings.”  When the difference is low, it usually means “few, stale listings”

Inventory Indicator Graph

Since 2010, we see regular spikes of the maroon line occurring in late July – early August.  This is when sellers decide to sell and maximize their listing exposure during the nice weather and greenest grass times of summer.  Inventory is at its highest and freshest (lowest days on market). As a buyer, this is when you have the most choices.  As a seller, this is when you have the most competition!

Troughs tend to occur between January and April of each year.  This is when buyers are done buying properties for the ski season and inventory gets depleted.  It is also when sellers, who are thinking of selling, wait until the ‘shoulder season’ ends so that their property is fresh when the summer buyers come around the 4th of July.

It is interesting to see how steep the graph is on either side of the peaks.  On the front side, there is almost a mad rush to get properties listed for sale before the crowds of summer start visiting Mammoth.  On the back side, the buying spree in fall, combined with sellers letting their listings expire at the end of summer create a steep drop in the maroon line when inventory decreases and DOM increases.

Can’t time the market?  We are told that it is almost impossible to ‘time the market’ (i.e. buy low and sell high).  Well, you might be able to “time the inventory” and buy in the spring when choices are plentiful and sell in the fall when buyers are a little more motivated.

and more importantly…snow is here!

Mammoth Mountain Ski Area opened on 11/13/14 with a mix of manmade and nature-made snow.  After three subpar years of snowfall, we are all hoping for more natural snow to ski on and to quench California’s dry soil. At the time of this writing, it is snowing!

The big news at the ski resort is Mammoth Mountain Ski Area’s purchase of Big Bear and Snow Summit.

Consolidation has been the trend in the ski industry over the last decade, evidenced by Vail Resorts’ purchase of Northstar, Kirkwood and Park City over the last few years.  The general feeling around Mammoth Lakes is that this move can be a good thing.  SoCal resort loyalists may be enticed to try out Mammoth and we hope they like what they ski.  Similarly, those on the fence about committing to a weekend in Mammoth may choose to save time once in a while and ski/ride more locally.

Cali4niaPass.com is now available for 4 resorts, Mammoth, Big Bear, Snow Summit and June Mtn!  MMSA and June are making efforts to attract more families.  June is even go so far as to let kids 12 and under ski free!

Mammoth Condo prices up 18% since bottom of market

After falling 65.9% from the peak of our market in 2007 and bottoming out in 2012, the average $/sqft of condominiums and townhomes in Mammoth Lakes has risen 18.1% and currently sits at $295.2/sqft for all sales in 2014 (through November 16, 2014).  See the graph below.

If we separate Intrawest and non-Intrawest condos (for the reason that Intrawest built a distinct class of real estate that are newer and located adjacent to the ski area and golf course, and they typically sell at a higher $/sqft), Intrawest properties dropped from $895/sqft in 2007 (many Westin condos were over $1000/sqft) to $362/sqft in 2012 (a 59.5% drop!) and are now up to $466/sqft, a healthy increase of 28.7% from the bottom.

Intrawest properties include The Westin Monache resort, The Village at Mammoth, Juniper Springs Resort and a few complexes along the Sierra Star Golf Course.

Non-Intrawest condos peaked at $496.1/sqft in 2006 and valleyed at $222.4/sqft in 2012.  They are now at $259/sqft in 2014, an appreciation rate of 16.4% since the bottom.

If you are noticing that our peaks and valleys occur later than those in Southern California, you are probably right; it is felt that the Mammoth area market tends to lag behind SoCal by half a year to a year.

In addition, you are probably noting that our prices have a long way to go before reaching the bubble levels of 8-9 years ago.  We hear from our clients and follow Realtors in hot market areas like Santa Monica, Manhattan Beach, Santa Barbara, etc., that prices are now at or above the levels seen during the bubble.  Wow.  Makes the Mammoth market look like a bargain!

Our current market could be classified as healthy.  Inventory is historically low, foreclosures and short sale are rare, and many buyers are coming in with all cash or over 20% for their down payments.

-Dennis Cox & Tara Peterson

(Data is from the Mammoth Lakes Board of Realtors MLS and is deemed reliable but is not guaranteed.)

With winter just around the corner, we’re excited about the new flights being offered to/from Mammoth Lakes Yosemite Airport this season. In addition to the previous routes which included Los Angeles and San Diego, you will now be able to fly to/from Las Vegas as well as Denver, Colorado! (Read article here: http://www.sierrawave.net/32163/mammoth-yosemite-airport-new-flights/)

Mammoth has received it’s first “dusting” of the fall and although temperatures are slowly climbing back up to their seasonal “norms”, we are all hoping for a nice early snowfall to give us a jump start to the ski season.

Real estate prices in Mammoth have been creeping upwards slowly and steadily…our market is healthy and we’re definitely seeing the typical activity that we see once Labor Day is past and buyers get serious about purchasing before the ski season.

The Town has seen some pretty dramatic improvements that might not be noticeable to the typical tourist, but you’ll find a number of roads that now boast actual sidewalks! Canyon Blvd and Meridian Blvd. have undergone and are undergoing big changes.

If you’ve never visited the Mammoth Lakes area in the Fall, you should make it a point as the fall colors are just starting.

Think Snow!!!!

ACTIVE REAL ESTATE MARKET NUMBERS – Mammoth Lakes

Mammoth CONDOS:

Condo Supply: 3.7 months

Mammoth HOMES

Home Supply: 10.0 months

As with many areas in California, the inventory of properties for sale is currently pretty low. As of today, there are only 111 condos and 40 homes for sale in Mammoth Lakes. We have not seen this kind of a ‘drought’ since 2006, the last time the market was “hot.”

As you can see from the Graph #1 below, inventory levels (green line indicates # of condos, homes and lots for sale) grew to their highest levels in August 2007 with 315 condos and 107 homes on the market. Inventory remained high while the market was bad from middle of 2006 until middle of 2009. When people started buying again in 2009, inventory dropped and we returned to a seasonal market with inventory going up in spring (see the peaks in summer 2010 and 2011) and declining in winter.

REO’s / Short Sales: Even the inventory of foreclosures and short sales has dried up. The most amount of condo REO’s on our market at one time was 16 back in spring 2011. The height for short sale condos was 39 back in summer 2009. We currently have 5 foreclosures and 5 short sales in the condo segment. (There is only 1 single family home foreclosure right now and no short sales).

Supply: When the market tanked in ’08, sales were very slow and our supply (defined by inventory divided by sales pace) slowed to 48 months for condos. This means that it would take 48 months at that slow sales pace to sell all of the condos on the market. In contrast, the quickest supply was down to 1 month in November 2005 and it is currently 4.1 months.

Our numbers actually mirror the national supply numbers. The National Association of Realtors reported a supply of 4.4 months at the end of December 2012, which is the lowest supply since May 2005 when it was 4.3 months.

Prices: Prices in certain segments have started rising a little bit. The $/sqft on Intrawest condos at The Village, Westin and JSL/Sunstone peaked at $925/sqft in 2007 and dropped to $375/sqft in 2012 (a 60% drop). See Graph #2 below. So far in 2013, it is inching up to $377/sqft. Anecdotally, we are seeing emails from other agents trying to fish out listings for buyers who are anxious for units at The Westin (which has been getting excellent rental income) and for homes right by the slopes.

So, it has been turning from a buyers’ market to a sellers’ market. If a property is priced appropriately, it gets lots of attention and usually gets multiple offers and sells quickly. And negotiations for other things like requests for repairs and other concessions during escrows are tipping back toward the seller. The sentiment is that we have hit the bottom of this real estate cycle and there is urgency to get in while prices (and interest rates!) are still low.

If you are a buyer, keep a watchful eye on your favorite Realtor’s website. Sites like Zillow and Trulia often have outdated information and old listings. It is best to go right to the source; the MLS Search on our website is updated daily with the most accurate information on all of our listings in Mammoth and surrounding areas.

If you are a seller, congratulations…you survived the downturn and may start to see an increase in the equity of your property. If interested in getting our opinion of what your property is worth, email us the basic details on your property. And if you are seriously thinking about selling, talk to us; we can go over our marketing package and perform a Comparative Market Analysis on your property to further dial in a value.

In the meantime, the snow quality has been excellent on the ski resort. Both of us need to get out there more!

Best,

Dennis & Tara