A Typically Slow Winter Market with Positive Signals

The N. Lake Tahoe, CA real estate Market is slow as is typical for the middle of the first quarter. With snow piling up, there is limited housing inventory, and although buyer activity has picked up over the last few months, unit volume is at a 15 year low. Despite the slow winter market conditions, we saw the median home price climb 9% in February to $1,350,000. This indicates that buyers are willing to pay a premium for good quality homes that are located in desirable neighborhoods.

If there was more high-quality inventory in good neighborhoods, sales volume would pick up as buyer demand has increased. Buyers remain discerning and are mostly writing offers on well-priced homes, located in good neighborhoods with minimal differed maintenance. With mortgage interest rates hovering just below 7%, buyers are exercising patience when it comes to Tahoe home purchases. As the days get longer and the snow begins to melt, we will see more homes come on the market and if interest rates continue to fall as expected, the market should come alive this spring.

February 2024 Market Highlights

• Median home price Up 9% to $1,356,000
• High Sale: Martis Camp estate at $7,415,000
• The 5 highest sales in February were from 5 different luxury communities: Martis Camp, Truckee River, Lahontan, Schaffer’s Mill and Gray’s Crossing
• 59% of February home sales were priced over $1M

The Early Bird Catches the Worm

We anticipate that listing inventory will jump at the start of the second quarter. Sellers that bring their homes to market at the end of the winter and early spring will benefit from minimal listing competition and increased buyer demand, helping to push pricing higher. As home values rise, more sellers will list their homes for sale. Beat the competition to market, enjoy the favorable selling conditions and catch that worm. 

Homes with waterfront amenities, views, and modern amenities are selling well. With limited inventory in the Tahoe market, now is a great time to consider selling your property as buyers are looking for good quality homes.

Year over Year Market Conditions and Value Trends

Lake Tahoe Real Estate Year February 2024 Market Report Sales Chart

Lake Tahoe Real Estate February 2024 Market Report Sales Volume Chart

*North Lake Tahoe, CA and Truckee Single-Family Home sales including lakefronts. Data is taken from the Tahoe-Sierra Board of Realtors, MLS Areas 1-9.

Absorption Rate: 1.55 Months of Inventory = Seller’s Market (*hybrid)

The term absorption rate refers to a metric used in a specific real estate market to evaluate the rate at which available homes are sold during a given period of time. Here are the statistics used to determine the absorption rate for the North Lake Tahoe, CA and Truckee real estate market.

Absorption Rate (single-family homes)

• 413 Sales in the Last 6 Months
• 69 Sales per Month
• 2.29 Sales Per Day
• 175 Current Active Listings
• 175 Listings / 69 Sales Per Month = 2.536 Months of Inventory = Seller’s Market
• • 1 to 3 Month Supply of Inventory = Seller’s Market
  • 4- 6 Months of Inventory = Balanced Market
  • 6+ Months of Inventory = Buyer’s Market

With only 2.53 months of inventory (single-family homes for sale), there are very few active listings in any given neighborhood, creating an advantage for sellers. Savvy buyers will see this data and take advantage of the shifting market conditions and make purchase decisions prior to a continuation of increased demand and limited inventory. If you see a home that you love, buy it now as prices will likely increase throughout the year. Although inventory will seasonally adjust upwards, so will demand, making now a great time to buy.

Pending Home Sales Provide Market Insight 

Pending sale activity shows transaction volume up 19% over February closings with pricing trending upwards. Currently, there are 53 pending single-family homes in escrow with an average list price of $1,867,528 and a median price of $1,385,000. Out of the 53 pending sales, 72% are priced over $1M with 7 homes above $3M, and 4 listing above $5M. These pending sales solidify that the market is picking up steam in a time period that it typically quiet. The average marketing time for the pending sales in at 87 days.

2024 Lake Tahoe Real Estate Market Predictions 

The Lake Tahoe real estate market is positioned to have a good year in 2024 as buyer activity is anticipated to increase as mortgage interest rates fall. Housing inventory (listings) is expected to remain low, so it would seem that if demand rises and the number of listings remains low, we will see price increases throughout the year. Inversely, if buyer activity remains low and inventory is constrained, the market could be flat in 2024.

• As mortgage interest rates come down, buyer demand will increase
  • rates are expected to come down throughout the year
  • the sweet spot for strong buyer activity is between 5.75% and 6.25%
• If inflation continues to fall the market will have a positive response
  • keep an eye on the Federal Reserve inflation data
• Avoiding a recession will boost buyer confidence
• A higher number of buyers in the market will put upwards pressure on pricing
  • bidding wars might return, especially at lower price points
• Limited housing inventory is expected 
  • Sellers have lots of equity and will only sell when timing is right
• Demand for quality homes in good neighborhoods will likely increase

Lake Tahoe Real Estate Market Report Archive

View All Tahoe Real Estate Market Reports
February 2023 Real Estate Market Report
February 2022 Real Estate Market Report 

Contact Lake Tahoe Realtor, Dave Westall

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