Inventory in California’s Lake Tahoe reaches unprecedented lows

By LINSEY STONCHUS

In 2020, California’s Lake Tahoe earned national attention for its record-breaking home sales.

Looking back halfway through 2021, this same momentum has not slowed and inventory is dramatically dwindling. As of early July, Chase International, a brokerage in Tahoe City, California, reported only 254 active listings total on its MLS.

“Never has it been so low,” said Trinkie Watson, a realtor at Chase International.

For context, Tahoe Donner, a subdivision in the Truckee area, has seen an inventory as high as 300-plus homes within that community alone.

“It is pretty hard to compare this last year to anything we have ever seen,” Ms. Watson said. “You are going to find that with most resort areas right now.”

Shoring up sales

The great appeal of Lake Tahoe is its natural beauty and the recreation that comes along with it.

Eighty to 85 percent of the land around the lake is protected under government ownership. It is a major draw for buyers, but also acts as a barrier for added inventory, as there is a limit on how much the region can build out.

Accordingly, Tahoe has become extraordinarily competitive.

Year-over-year, Chase International sold a total of 2,233 homes in 2020, nearly 75 percent up from 1,490 properties in 2019.

Of course, lakefront homes are most popular and these properties are swept up the fastest. They are also least likely to come back to market.

Typically, Chase International has 20 to 25 single-family homes listed along the north and west shores of Lake Tahoe. During May, there were only nine.

“I have a feeling we are going to be dealing with a skinny inventory through most of the year,” Ms. Watson said.

“Everyone says we are going to have another banner year,” she said. “I do not know if we are, if we do not have anything to sell.”

Driving home the point

Low inventory means high prices.

Multiple offer situations, too, are further inflating heftier price tags.

“It is nothing to see 10-15 offers on a house,” Ms. Watson said.

Few homes are listed under $1 million, but those that are have the largest pool of buyers and, accordingly, are the most competitive.

Much of this competitiveness, however, is still felt among those homes listed between $1 million and $2 million.

Above $2 million, prospects narrow, but Ms. Watson remains optimistic, as it is evident that those determined to live in Tahoe can expect to shell out money for the opportunity.

“There are still a few really expensive homes on the market that have not sold that very well could this year,” Ms. Watson said.

Nonetheless, the market does not come without its hazards.

“People do get to a point, especially if they have lost out on a number of offers, that they decide that they are not going to wait it out,” Ms. Watson said.

Interest rates are also expected to rise soon, which may impact buyer ability.

On the flip side, it may also mean sellers relax prices if they feel their homes will be harder to sell.

Young at hearth

Although Tahoe is known as a vacation home market, there is a rise in those seeking to permanently reside there or, at least, for extended periods of time.

“We have seen quite a few home sales to those moving here permanently, at a rate that we have not seen in over 25 years,” said Sue Low, senior vice president at Chase International.

Emerging demographics have included those old and young.

“Young people are coming here and making this their permanent home because they can work from home and they love the lifestyle,” Ms. Lowe said.

“We are also seeing people that are retiring or on the sunset of their career coming up and spending more time here,” she said.

PRIMARY RESIDENCES ASIDE, Lake Tahoe remains one of the most sought-after travel destinations in the United States and will continue to maintain much of this appeal, especially while international travel remains a challenge.

In the summer of 2020, the outdoor destination’s tourism performed tremendously well. Thus far, this summer has proven no different.

“Reservations for hotels are way up, so we are once again inundated with visitors like we were last year,” Ms. Watson said.

Ultimately, many travelers are inspired to stay.

“When people come, they love it,” Ms. Watson said. “They say, we should buy something.

“Right now, the question is, can they find anything to buy?” she said.