July, 2016 Tahoe-Truckee Market Update
Strength and stability best define the performance of the Tahoe-Truckee real estate market through the first half of 2016. Every discernable metric demonstrates growth ranging from 6% (median price) to 13% (average price; total transactions) to 29% (total sales volume) when measured against the same period a year prior.
The combination of economic prosperity within the Northern California feeder market and the foundational values inherent to the mountain lifestyle merge into surging demand for our region. More and more the call of Lake Tahoe is becoming imbedded in the culture of young families for whom time spent in pursuit of family and fitness is the antidote to the plugged in frenzy of everyday life. As the Bay Area workforce trends younger and more prosperous, demand for Tahoe has surged.
Charting the course of average price since 2012:
Among this evolving demographic of consumer, new trends have taken shape. A deluge of construction throughout the region indicates a desire for modern detail most evident in a dramatic swing toward contemporary architecture. As well, time spent maintaining older homes or those in outlying areas is seen as dilutive to the pursuit of activities for which the home was purchased. As such, property within well organized, resort communities with functional, if not lavish, common amenities are performing well.
More progressive communities have sought to augment the offerings for owners by adding additional facilities including beachfront amenities on Lake Tahoe, enhanced fitness and dining options on-site, or cross-community offerings as with Tahoe Mountain Club.
At the opposite end of the spectrum, homes requiring modernizing or behind in deferred maintenance projects have had a more difficult time finding buyers.
Case in point to these shifting values is the juxtaposition of Martis Camp, a new, brilliantly conceived community home to a remarkable package of facilities plus direct access to Northstar, in comparison to Tahoe lakefronts; the historical standard bearer of luxury throughout the region. While lakefronts will always offer the most direct reflection of the region’s crown jewel amenity, the homes in limited supply have aged and many have found the process of redeveloping to be too arduous or cost prohibitive to modernize. As such, Martis Camp homes have outperformed lakefront properties this year in total sales (22 vs. 8) and average price ($4,673,000 to $3,831,000).
Is it possible that as the pendulum inevitably swings back over time, lakefronts will emerge as an undervalued commodity? Similarly, the thought of savvy investors buying waterfront estates with patience to navigate the regulatory process and capital to modernize may become a reality.
In the meantime, communities embodying the values core to the current values of Lake Tahoe consumers including Northstar Mountainside, Lahontan, Gray’s Crossing and Old Greenwood will continue to thrive. Each has new and exciting offerings coming on line this year.
The second half of 2016 promises to be an exciting and dynamic time. We look forward to keeping you on the forefront of the market.
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