The coronavirus pandemic has flooded the Tahoe real estate market with an unprecedented number of buyers seeking an escape from urban lifestyles that have shrunk in the wake of COVID-19.
Home sales in Tahoe/Truckee this June are almost double what they had been the year before. And some popular neighborhoods like Tahoe Donner have seen the volume of home sales more than double over last year.
With many urban professionals working successfully from home, and public spaces shuttered throughout many of California’s cities, open space has become the new luxury.
In Tahoe/Truckee we are seeing this not only in the rising number of luxury cash sales, but also in the cutthroat market for homes priced around or under $1 million, where multiple offers have become the norm and many homes are selling at the asking price or above asking.
In the Martis Valley, home to the tony Martis Camp, home sales quadrupled this June over last year.
Eight homes closed escrow in the Martis Valley for a combined monthly volume of more than $33 million (all but one were cash purchases). One of the Martis Camp homes was a five-bedroom that closed in 17 days for $7.8 million cash after sitting on the market for a year and a half.
The reopening of Tahoe’s hotels and restaurants in May unleashed a wave of pent-up demand on the housing market here that continues to be felt into mid-July. And luxury enclaves like Martis Camp are not the only neighborhoods to feel the impact.
In Incline, some parts of the East Shore like Glenbrook and elsewhere, homes that had wallowed on the market for a year or more suddenly saw multiple offers in the space of a weekend.
The trend is being fueled by a strong buyer penchant for elbow room. Condos, it seems, do not hold the same appeal as homes backing to open space or acreage. Throughout the region, condo sales volume is down to just 65% of what it had been the year before. At the ski areas, the drop in volume was even more precipitous, with less than $5 million changing hands in June (almost a 60% drop from last June).
Properties on acreage have benefitted from the trend.
One home in the gated Juniper Hills neighborhood above Glenshire got close to its asking price of almost $1 million. It sits on 20 acres, as do almost all the homes in that rural neighborhood fed by well water, but it’s a two-bedroom with no garage.
In Prosser Lakeview and Sierraville, two homes on 3 to 10 acres sold in just over a week on the market.
New homes are also benefitting from the influx of well-heeled urban buyers. One Tahoe Donner home, still under construction with no sheetrock and almost no flooring installed, had three offers in one weekend and is likely to sell for well north of its $1.55 million asking price. In Gray’s Crossing, a walkable golf course community near downtown Truckee, new homes under construction are also selling at the framing stage.
For buyers, the frenzied market can present a white-knuckle experience. When you see a home you love that’s not even finished, and your realtor tells you that you need to offer almost $200,000 over asking, and you need to do it now, do you trust her?
And even if you do trust your advisor, do you want to compete in a frenzied market where you might be overpaying?
An appraisal, which is required on any financed offer, is a buyer’s best protection against overpaying. With a very hot market, appraisals will be based on current comparable sales, however, so the likelihood is that there will be other sales to justify the over-asking price.
What’s it worth to you?
If you live in an urban area, as many of my buyer clients do, much of what you enjoyed about San Francisco or Los Angeles has been stripped from you in the wake of the COVID pandemic. In that climate, what’s the value of open space, privacy, and fresh air?
Based on the explosion of sales in the Tahoe/Truckee market, the freedom of breathing space is, quite possibly, priceless.
~ Jackie Ginley is a broker associate with Chase International Real Estate. You can see her listings at tahoeishome.com.