Coldwell Banker -2021 Real Estate Market Report
North Lake Tahoe -Truckee
Total Residential Sales: 119 residences sold in October, representing the lowest number of October sales since 2011. The 10 year average for the month of October is 163 sales.
Through the month of October, there have been 1,400 residential sales. This is down 17% from the same period in 2020 (1,687 sales), but still 5% higher than the 5 year average, and 14% higher than the 10 year average.
Median and Average Sales Prices: These numbers are plateauing but continue to be substantially higher than pre-COVID (by 60-70% compared to most 2019 comparisons).
When isolating on single family homes, we have moved from a median of $724,250 in the first half of 2020 to $1.135m in Q1 2021, $1.2m in Q2 2021, and $1.175m in Q3. The average sales price has moved from $1,080,082 in first half 2020 to $1.892m in Q1 2021, $1.669m in Q2 2021, and $1.788m in Q3 2021.
Active Residential Inventory: Active Listings: There are currently 150 residences actively for sale (122 single family homes and 28 condos). This is down from 197 a month ago, and less than 1/3 of the inventory we typically expect to see at this time of year.
The 6 month period from May through October 2021 saw 971 new listings. This is an 83% decrease from the same period in 2020 (1,775 new listings). It is also the lowest number of new residential listings in 10 years, for that period. It is 35% lower than the 10 year average for the period and 23% below the next lowest year in the period (1,193 in 2012).
Current Pending Sales: There are currently 171 residences in contract (down from 181 last month). 120 residences went into contract in October (the same number as in September).
Current inventory represents about 1.25 months of supply, relative to October activity.
Sales Under $500,000: From January through October, residences priced under $500,000 represented just 9% of sales or 123 properties sold. For the same period in 2020, 19% of sales were in this range.
Mid-Range Market Sales $500,000 to $999,999: For the same period, 590 residences sold between $500,000 and $999,999, representing 42% of total sales. For the same period in 2020, 50% of sales were in this price range.
High End Home Sales $1,000,000 to $1,999,999: Through October, 468 homes have sold between $1m - $2m, representing 33% of total sales. For the same period in 2020, 277 homes sold in this price range, representing 20% of total sales.
Luxury Home Sales Over $2 Million: 219 residences have sold over $2 million so far this year, representing 16% of sales. 56 of those sales were over $5 million. For the same period in 2020, 192 homes sold over $2 million, representing 11% of sales. 38 of those sales were over $5 million.
What’s Going On Looking Forward?
If you read this every month, you’ve undoubtedly noticed the dramatic decrease in the number of transactions this fall compared to fall 2020. Looking at that alone, you can tell our market is evolving. What is that evolution? Is it becoming a buyer’s market? Still a seller’s market? What’s happening with pricing?
The short answers to those questions . . . it is still a seller’s market, but more balanced than it has been. Pricing is always difficult to gauge in the short term, but seems to be holding steady (it definitely is not surging the way it was last year and early this year).
This is the perfect Econ 101 class where we are watching supply and demand change in real time. A year ago we were clearly in an environment of both high supply and high demand. The number of new listings (supply) was significantly above normal throughout the 2nd half of 2020 and into Q1 of 2021, and demand was so strong that all the supply was rapidly selling, leaving little to no inventory (that’s why it seemed like there were very few homes available).
As noted above, the supply side has flipped. The last 6 months the supply of new listings has been 35% lower than average for the period. Simultaneously, some headwinds started to arise on the demand side. Fires, smoke, the resurgence of COVID, and the return to “normal” school and work have softened demand. We also have the short term rental environment . . . BOTH Placer County AND The Town of Truckee have put moratoriums in place removing the ability to apply for a new short term rental permit in either area (existing permits can still be used and renewed). There’s also buyer fatigue (buyers withdrawing from the market because they are tired of being outbid), and inflation. All of those things have contributed to slowing demand relative to last year.
With all these changes, the shortage of inventory, and lack of new supply, is still the dominant feature and still has us in a market favorable to sellers. However, the new variables impacting demand make it difficult to predict what things will look like going into our historically slowest months of the year. Sellers don’t hold all the cards like they did in the second half of 2020 and first half of 2021. Overpriced homes are sitting on the market, there aren’t multiple offers on every home, and buyers can find a bit of leverage in certain situations.
Our expectation is that supply (new listings and inventory) will remain low through the winter. If that holds true, the trend toward smaller numbers of transactions will continue. Pricing is likely to hold steady, unless something triggers another surge in demand, or, in a bigger surprise, a surge in supply.
Contact Me Today to Find Out More about the Opportunities Available in the North Lake Tahoe-Truckee Market.
Note: Data on this page is based on information from the Tahoe Sierra Board of Realtors, MLS. Due to MLS reporting methods and allowable reporting policy, this data is only informational and may not be completely accurate. Therefore, Coldwell Banker Residential Brokerage does not guarantee the data's accuracy. Data maintained by the MLS may not reflect all real estate activity in the market. CA-BRE License # 1908304