If a vacation home in Lake Tahoe is on your holiday shopping list this year, be prepared to pay a premium for what little inventory remains.
In November, the Tahoe-Truckee market showed little deviation from the record-setting pace that began during the summer months. The surge in home sales is fueled by several factors, including a steady migration of well-heeled Bay Area residents and record-low interest rates.
“Our market is a drive-to resort destination that is driven almost entirely by the San Francisco Bay Area,” said Jeff Brown, owner of Tahoe Mountain Realty. “The last six months have been the most productive in the history of our region as hordes of consumers have sought refuge in the mountains.”
According to Tahoe Mountain Realty data, there were more than 250 residential closings in November that combined for more than $250 million in sales volume. During the month, sale prices averaged $1.163 million, a 36% uptick compared with the same period the previous year.
Those numbers would represent price records for the region in any other year, but 2020 has not been just any other year.
To date, the Tahoe-Truckee market has recorded more than 2,000 residential sales, up from 1,763 a year ago, according to Tahoe Mountain Realty. Residential sales greater than $2 million have doubled this year, jumping from 94 in 2019 to more than 200 to date in 2020. Sales volume is well over $2 billion, surpassing the previous high-water mark of $1.7 billion.
Additionally, some 520 vacant land sales in 2020 total more than $200 million to date, more than twice the area saw the previous year (250 deals totaling $82 million).
The Lake Tahoe and Truckee areas historically live by a seasonal rhythm, according to Brown. However, he noted that this year’s market has operated without a sense of seasonality.
“Demand has surged at times that do not correspond to typical tourist flow,” he said. “As a result, we have maintained a very high and steady level of productivity when we would otherwise be re-calibrating for the season to come.”
Though Tahoe’s lakefront still has a draw, there has been a migration away from the area in recent years, as new construction in the surrounding areas has captivated home buyers with highly upgraded homes featuring modern architecture.
Martis Camp, a luxury community located midway between Truckee and North Lake Tahoe, has seen its median price increase to nearly $6 million in 2020. In contrast, Tahoe Lakefront has seen its median dip to about $4.2 million.
In North Lake Tahoe, the resort community of Gray’s Crossing is nearing 50 residential sales, up from a previous high of 30 in 2019. Lahontan, a resort community in Truckee, this year notched records for total sales (34) and median price ($2.857 million).
Even with a COVID-19 vaccine on the way, don’t expect to see a downward trend in 2021. Brown said that some buyers have permanently relocated to the area, while others have stayed indefinitely with the intention of splitting times once conditions are normalized.
“Our consumers have become unburdened by the expectation of physical presence, whether in the workplace or school,” he said. “This has liberated them to contemplate life in settings that encourage health and wellness above the daily grind of urban living.”