|
October 3–Mammoth's real estate market has definitely changed in the past six months, leaving the frenzy of 2003 and early 2004 behind. The current market conditions are; 1.) Misleading because knowledgeable market watchers know you need to "scrub" the market data to really see what is happening, 2.) Providing excellent opportunities for savvy buyers willing to work through some offers, 3.) Proving that the traditional axioms of real estate (which have been tossed out the window the past couple of years by many practitioners) always come back around, 4.) Providing Mammoth's real estate professionals time to catch up on work, life, and recreation.
Before my last vacation in August, I told many people that we had a pretty good inventory of property listed for sale but not a lot of sellers. Many sellers were still hanging on to the price appreciations of the past winter, and it just isn't there. Those with properties listed that are truly "sellers" are either dropping their prices or settling for far less than the asking price if they get an offer. Meanwhile, many would-be sellers are sitting around waiting for the next surge in values. Depending on what they own, they may be waiting for quite awhile.
If we look at the current inventory of condominiums on the market, we see that there are roughly 200 units on the market.
Of those 200, there are some real pearls–great projects with excellent locations and well maintained. But once we throw out all the units that are actually in escrow and the agents are not reporting them as pending, and we throw out all the old, less-desirable condos that are now grossly overpriced, we throw out the speculators (look in the Village) who need certain price points until their lack of cash flow kills them, and we throw out those that are listed but their owners aren't really sellers, and there isn't much left. There has been one salvation. Lately, we have seen a considerable number of agents from out of town (what are they out-of-work?) coming to represent clients. These agents are one of the best things for the sellers in our market. They don't know the nuances of our market and are typically selling their clients substandard properties at higher prices–not really negotiating with all of the advantages of local knowledge. Ultimately, the buyable (with a conscience) condominium inventory is really quite small at this time. And as we head towards winter, this is the condominium buying season.
Residential inventory is hovering around 60 properties on the market. There are and have been some very good buys. But again, there are not many real sellers. There have been more buyers in the last month than during the summer. Buy on location and/or more modern construction. There are some great buys in the $650,000 to $950,000 range. Residential lots continue the same as always–some good ones left under $500,000, but scarcity rules and to get a real quality lot you've got to start around $800,000. One of the key drivers in all of the resale market continues to be the "move-up" buyer.
The fractional and "club" ownership developments continue to push their wares and it will be interesting to see how well they are received by the winter visitors. There is plenty of money riding on their anticipated success. The project dubbed the "Westin" (actually Monache) in the Village has been put on hold for now because construction cost bids came in too high. I think they are beginning to figure out that intensive building in Mammoth in the winter is just too much of a hassle and too expensive. It really erodes the bottom line. So that delay will allow Intrawest to market this exciting new Village project all winter.
The airport environmental work is winding up so that should all return to the front burner in the next six months. Construction remains strong all over town including two major affordable housing projects, one adjacent to the Snowcreek Athletic Club and one on Meridian Blvd.
Since Mammoth real estate started its current run-up in the summer of 1998, the market has ebbed and flowed. It appears that the election and a "step back and assess" mode have effected the local market and slowed it down. But based on the numbers closing out the third quarter, far from dead. Other resort markets that we are in touch with from Washington State to the Florida Keys report strong markets. The demographics simply haven't changed. Interest rates remain incredibly low, and all the lenders indicate that no matter what the Fed does, those rates should remain low. So it will be very interesting here in Mammoth to see what happens once the election is over and we get snow on the ground. Hopefully things don't get crazy again until the chores are done and we get a chance to get our feet back on the ground.
|
