As Major Urban Real Estate Markets Cool, Lake Tahoe’s Resort Markets Thrive
2018 was a good year for Lake Tahoe, Truckee and the surrounding area real estate market. While major urban and suburban markets experienced a cool down fueled by buyer price exhaustion and supply factors that play into frenzied markets, Northern California and Nevada resort properties remained a popular investment.
The allure of the lake, California’s outdoor lifestyle and Nevada’s tax friendly climate continued to attract buyers and second homeowners across all price points while limited supply created bullish region-wide trends in pricing.
Lake Tahoe waterfront properties featuring new construction, sandy beach, pier and buoys are selling within days of hitting the open market if not before. Pictured: 1170 Vivian, Incline Village $15,950,000. Courtesy: Sierra Sotheby’s International Realty
The regional lakefront market was a bright spot in 2018 with waterfront sales volume on Tahoe’s East Shore doubling from seven sales in 2017 to 14 in 2018.
Lake Tahoe’s North and West Shores generated 35 lakefront sales with eight transactions over $10 million and four sales topping $20 million. The highest priced lakefront sale was an aspirational $40 million property on the West Shore of Tahoe, set on more than nine secluded acres and complimented by an entertainment barn, a two-lane bowling alley, two guest homes, a tennis court, deep water pier, swim platform and boat lift.
Incline Village’s Lakeshore Boulevard boasted the second highest lakefront sale of the year fetching an impressive $36,500,000 in less than a week with multiple offers.
For buyers and sellers, “A premium is always paid for level lots with piers, and secured entitlements,” says Katherina Haug, a North Lake Tahoe-based real estate specialist with Sierra Sotheby’s International Realty. “Proper preparation prior to coming to the market is paramount to achieving full market value,” she adds.
At press time there were eight active and one pending lakefront homes priced up to $39 million in the Incline Village/Crystal Bay area according to Jeffrey Corman, an Incline Village-based agent with Sierra Sotheby’s International Realty. “We continue to see strong showing activity and quality offers on properties with highly sought-after amenities including new construction, sandy beach, pier and buoys which are all available with several properties currently listed.”
In 2017 average days on market for Incline Village lakefront homes was just over two years. In 2018, the listing period was closer to 10 months with a median price of $5.7 million. The median price for non-lakefront single-family homes in Incline Village was $1.2 million with an average of 224 days to sell, while more affordably priced condos were selling in 124 days on average with a median price of $540,000.
Newer homes with modern upgrades are in high demand with Lake Tahoe buyers. Pictured: 5710 Tiger Lily, Sugar Bowl, $3,790,000. Photo by Vance Fox.
EAST SHORE: GLENBROOK, ZEPHYR COVE, STATELINE
While the lakefront market was strong in this region, single-family, non-lakefront sales volume was down by 18 percent combined with an 8 percent dip in median prices. A closer look at this sector reveals that Glenbrook and Zephyr Cove showed signs of cooling while Stateline showed significant double-digit gains in volume and pricing. These contrasting statistics are an example of why it’s important to contact a local real estate specialist to understand the full picture of what’s happening in a market of interest.
Popular amenity-rich, luxury neighborhoods such as Martis Camp, Old Greenwood, and Schaffer’s Mill all reported gains in average sale price as volume continued on a steady pace with the prior year. Lahontan was a stand-out in terms of sales volume with 27 homes sold in 2018 as compared to 16 in 2017 with an average sold price of $2.34 million (a 1 percent increase over 2017).
In Truckee’s more modestly priced neighborhoods such as Sierra Meadows where the median home price is $540,000, homes were selling as quickly as 15 days on average. Tahoe Donner single-family homes sold in roughly 41 days with an average sale price of $772,000, a 6 percent increase over 2017. Sales volume for Tahoe Donner was down by 31 percent with 56 homes sold in 2018 versus 81 sold in 2017.
The highest priced sale in Truckee was $11,750,000 in the gated Martis Camp community where average sale price in 2018 was $5.25 million with an average of six months accumulated days on market. The lowest priced sale (excluding land transactions) was a Tahoe Donner studio condo that sold for $75,000.
SOUTH LAKE TAHOE
Generally speaking, South Lake Tahoe homes were selling in roughly 100 days on average in 2018, which was only slightly faster than the prior year. Total non-lakefront sales volume in South Lake Tahoe was down by 7 percent, however, several niche markets such as the Tahoe Keys outpaced 2017 sales despite much ambiguity surrounding the short-term rental market.
“Inventory remains low, and demand stayed strong during the year,” said Amanda Adams, South Lake Tahoe real estate specialist with Sierra Sotheby’s International Realty. “Even with the short-term rental changes in certain neighborhoods, prices have continued to rise for almost the entire South Shore area throughout the year. There are still great opportunities for buyers and sellers in the current market conditions.”
The highest priced sale in South Lake Tahoe in 2018 brought in $5.5 million while the lowest price sale (not including land) was a non-lakefront condo that went for $70,000. The median home price for non-lakefront single-family homes was $466,500 while median lakefront home prices are still under $1 million for the area.
Continued price hikes coupled with a dip in sales volume suggests that demand continues to outpace inventory in many neighborhoods throughout Reno-Tahoe. Pictured: 38 W Lightening Ranch Road, Washoe Valley. Photo courtesy Sierra Sotheby’s International Realty.
RENO /CARSON VALLEY
Sales volume for single-family homes in the Southwest Reno market was off by 11 percent in 2018 however, the average sales price was up by a solid 19 percent. The Northwest Foothills area saw 12 percent price gains, South Suburban prices went up 15 percent and South Meadows and Sparks each gained 13 percent. This trend suggests a continued gap in supply for the region.
Average days on market for Reno ranged from 70 days to five months depending on the neighborhood. Buyers in search of aggressively priced first homes or investment properties should be prepared to act quickly.
According to Randy Roesch, with Sierra Sotheby’s International Realty’s Reno office, “The higher end of the Reno market is much more balanced with certain top-tier price points even falling into a buyers market. Top-of-the-market buyers have plenty of inventory to choose from so sellers at this level need to price their homes competitively or be comfortable waiting to attract the right buyers,” says Roesch.
With an average sale price of $366,791, nearby Carson City stood out as a value-buy for Northern Nevada in 2018. Carson Valley markets including Gardnerville, Genoa and Minden all recorded a slow down in transactions coupled with an uptick in sales prices.
Encompassing an area of sleepy ranch neighborhoods and thriving golf course communities, Portola represents the highest concentration of sales activity for this region. With an average sale price of $158,665, Portola recorded 34 single-family homes sold in 2018 versus 33 in 2017. The Plumas Pines Golf Course area came in second in sales volume with 27 homes sold in 2018, a 35 percent uptick from 2017. Graeagle was a close third in volume with 23 sales and an average sale price of $503,500. The region continues to be popular with buyers who are looking for a quiet, wooded setting with both golf course amenities and mom-and-pop shops.
Located just 40 minutes west of Truckee along Highway 20, the Sierra Foothills market did not show signs of buyer pull-back in 2018 with homes in both Nevada City and Grass Valley selling in fewer than 60 days on average with sale price ranging from $290,000 to $600,000 depending on the niche neighborhood. Most Sierra Foothills neighborhoods saw single digit price increases in 2018.
As interest rates continue to be a hot topic, second home/ resort markets remain fairly insulated from the effects of nominal rate hikes. And with winter off to a healthy start in the Sierra, we can anticipate another prosperous real estate climate in 2019 with a bustling and balanced market that benefits everyone.
The data in this report was collected via six regional multiple listings services. To see all pricing and sales volume for Reno, Lake Tahoe or surrounding areas broken down by a specific resort community or neighborhoods visit tahoemicroreports.com.