Tahoe Truckee Market Update - May, 2015
At Tahoe Mountain Realty, we have long had a saying that market conditions override the season. Never has that been put to the test more than the first third of 2015. It is fascinating to observe the fight between economic conditions and seasonal considerations as the dominant driver of the Lake Tahoe real estate market. There is a retail component to Tahoe real estate that requires consumers to make buying decisions while in the region. In the winter months, this is generally driven by spontaneous ski trips wrapped around holiday visits, however recent winter conditions have left us with less visitation over the past few winters, taking some number of would-be consumers out of the market. However, with surging home prices in the San Francisco Bay Area and a percolating job market fueled by young families anxious for the health and well-being of time in the mountains, expressions of interest in resort real estate are robust.
The net result has been a steady number of real estate purchases when compared to the same period a year ago. Year-to-date, 351 homes have sold compared to 347 in the same period in 2014 and median price has dropped a bit from $537,000 to $515,600; both easily understood by the conditions detailed above.
The 1% increase in total sales can be found entirely within the sub-$1 million band where nearly 11% more homes have traded than a year ago. More specifically, sales between $400,000 and $600,000 are up over 55%.
|2014 ytd||2015 ytd|
|80||$400,000 - $600,000||124|
|48||$600,000 - $800,000||45|
|29||$800,000 - $1,000,000||30|
This can be attributed to a return to something near peak-value for most homes in the region after several years of solid appreciation. A return of equity has allowed many consumers, particularly those in primary home neighborhoods (generally > $1,000,000) to have some mobility after years of languishing in the downturn.
Correspondingly, the number of sales within ski communities tells the rest of the story. Northstar and Squaw Valley have combined for 30 sales year-to-date versus 61 at the same time a year ago; a logical result of fewer consumers coming to ski in a disappointing winter.
|17||> $1 million||4|
|6||> $1 million||0|
However, these resort communities appear to be the anomaly within the market as other luxury classes have shown continued acceleration through the winter. Martis Camp has held steady with 8 total homes sales however the average price has jumped for $3,298,000 to $4,700,000 with focus shifting from the cabin product to premium estate homes. Similarly, lakefront homes, typically a summer-dominated product, have seen 11 sales compared to 8 a year ago at a steady median price of $4,200,000.
In recent years as economic conditions have improved in inverse proportion to snowfall, sales volume typical of winter has not been eliminated; rather deferred until later in the year when visitation return.
Summer in Lake Tahoe is predictably spectacular offering far fewer variables for consumers. Conversations with local property management firms as well as the Ritz-Carlton; Lake Tahoe forecast record crowds enjoying the region and predicting another busy second-half for real estate sales.
We hope these patterns apply and that the beautiful season allows you to visit and enjoy the many wonders of the Tahoe-Truckee region. We will continue to keep you up-to-date of conditions as relate to our region and our relentless pursuit of its enjoyment.
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