The Tahoe/Truckee housing market isn’t sure, let’s looks at some of the numbers. Comparing sales volume from August 2018 to 2019 an overall decline of 5% can be equated. Upon breaking this down into regional sales:
– Tahoe-Basin dropped
– Squaw / Alpine increased nearly 90%,
– Truckee dropped less than 10%
– Tahoe Donner increased 40%.
What does this all mean! The trends over the last few months indicate a realignment to a more balanced market between buyers and sellers. Possibly a plateau in values for now.
The Balance Market Theory
A balanced market, in the real estate industry, is considered three-four-months of available inventory. If the active inventory continues to climb and reach 5 months or more, we will have shifted towards a buyer’s market at that point. In the real estate industry, the data that is used to analyze the market is pending sales to active listings, this determines how many months of inventory is available. The Tahoe/Truckee market has approximately four months’ worth of active listing at this time. The industry theory works off the idea of 30-day escrows and compares the pending sales to active listings. It looks at how many months would it take to sell through those active listings. An example of this is if you have 100 active listings and 25 pending sales it would take four more months at 25 sales a month to go through that 100-active listing.
Inventory has changed
The Tahoe/Truckee housing market has moved past the period of super tight inventory, where anything affordable sold in days and with multiple offers. There are a number of affordable properties available today with little activity. Value and being priced right “are now more important than ever” to get a property sold. The million-plus market continues to show strength with a variety of properties and good values in escrow.
Confidence in the Market
Is home-builder confidence an indicator of the market? Lot sales throughout the area are continuing to do well. I participated in my once a month Grays Crossing Design Review Committee (DRC) meeting this week for 8 hours. There does not appear to be any slowing of submittals for both custom homes and spec homes. Grays Crossing alone has approximately 60 homes either at submittal stage or under construction. In the Truckee market you will find building going on in every neighborhood Old Greenwood has had a developer doing spec homes, with some already completed and sold. The development at Cold Stream Canyon near Donner Lake will be our next new subdivision with infrastructure being put in place. Tahoe City has finally started on the Henrickson project, tearing down the old building and putting in a 60-million-dollar lodge with a 118-room boutique hotel, restaurant and conference rooms.