“November revealed clear signs of progress. Luxury properties are performing exceptionally well, and with supportive economic conditions, the outlook for the Tahoe-Truckee real estate landscape remains increasingly optimistic.”

“As fall transitions to winter, with colder temperatures and light snowfalls, anticipation for the season is growing. Regardless of the political and economic changes on the horizon, the timeless allure of Lake Tahoe stands as a constant.”

"Savvy buyers have been prompted to act now before competition increases and prices rise when interest rates eventually come down. Meanwhile, high-end properties see steady demand..."

"September begins the local’s summer. A period of optimal weather and diminished crowds when Tahoe shows of its exceptional beauty. Rogue snowstorms are bookended by 80-degree days as the first hints of fall colors creep in. These magical conditions will continue to supersede any other drivers of supply and demand."

During a typical sales cycle, consumers will visit 2-3 times to whittle down options before arriving at a purchasing decision. After a furious start to the season, second showings have moderated slightly. Anticipating a rate cut in the next 60 days, many consumers see the opportunity for more advantageous purchasing power toward the end of Q3. This is likely to put heavy pressure on sales activity in the weeks following Labor Day; already the peak period for deal making in any given year.

“The first half of 2024 has delivered a complicated set of results for Tahoe Truckee real estate indicative of a market seeking identity. Following a year of stagnation in 2023 characterized by declining sales amidst resilient prices and constrained inventory, 2024 has brought about a notable increase in residential transactions, signaling a potential turn in market sentiment…”

It would appear that a busy summer is forthcoming. With 420 residential listings, the most available since May 2020, buyer have selection. In addition, sellers have seemingly calibrated to pricing slightly below the peak and accepted interest rates relative to their next purchase in the interest of moving on to the ensuing chapter.

“The period from the end of ski season through Memorial Day often delivers the majority of new listings supplying the local marketplace for the busy summer season.”

“Q2 will begin to reveal a new condition. The same cause and effect that caused statis for much of the last 24 months may be giving way to a changing dynamic. Inventory has remained tight and pricing nearly fixed because seller who’ve otherwise exhausted the useful life of their Tahoe investment perceive poor buying conditions wherever their next move may take them.”

“Savvy winter buyers are recognizing that this may represent the moment when they are competing with the fewest competitors in the marketplace giving the best shot at securing a property without getting into a multiple bid situation.”

For now, our hope is that goldilocks real estate activity can be bolstered by a similarly ‘just right’ winter. The forecast for early February appears ready to deliver.

“We head into 2024 with a sense of cautious optimism for a return to more ‘normal’ conditions. The year begins with seasonally adjusted balance of about 3 months’ supply. While election year precedence typically signals a year of paralysis, the growing anticipation of a rate cut seems to have demand primed for acceleration should mortgages return to a more tolerable level…”

“Like so much of that last two years, pricing was dead steady indicative of consumers’ willingness to pay 2022 prices for premium product but lack of interest in anything considered imperfect. This sentiment combined with unmotivated or unrealistic sellers has resulted in painfully few transactions while providing the illusion of prices holding steady.”

“The final quarter of 2023 has begun by holding consistent to the typical Tahoe Truckee sales cycles. The volume of transactions frequently peaks in August, holds firm in September, then wavers slightly before tapering into the year’s end.”

Transaction volume peaked in Q3, typical of the season, but lags dramatically behind recent years and is on pace to deliver the fewest residential sales in a calendar year since 2008. However, home prices have remained generally stable as both average and median price are within 2% of 2022’s peak values. In fact, median prices have been almost entirely flat for the last 15 months.

“August delivered peak results for 2023 bringing the year’s top productivity measured by transactions and dollar volume. Several barriers were exceeded for the first time this calendar year including 150 residential transactions and $220,000,000 in sales volume. In fact, the quantity of residential sales was 27% greater than the next highest month this year.”

“With supply available but not overwhelming, summer consumers have more options to choose from and the opportunity to make a reasonable choice, though not such substantial leverage as to command meaningful discounts from asking price. July sales closed at an average of 99% of list price, though a quarter of all transactions required some modification in asking price before reaching a sale.”

“After the soaring volume that defined 2020 through the first half of 2022, the final months of last year showed a market that had run out of both inventory and energy. Q1, 2023 followed this path as transaction volume hit all-time lows, ultimately bottoming out in April once winter rendered the sparse available inventory virtually unshowable amid historic snowfall.”

“Listing inventory remains historically low at just over 300 properties for sale; approximately 3 months of supply based upon the last 12 months of absorption. The number of homes for sale is likely to rise over the next 30-45 days as homeowners contemplating the future utility of their second home reconcile with the aftermath of an historic winter.”

The current state of Tahoe – Truckee real estate reflects a market struggling to find identity. Buyers and sellers both perceive leverage over one another leading to conflicting metrics that reflect record low transaction volume, an equally tight supply of available listings, general pricing resiliency and increasing time on market.