The Tahoe-Truckee regional real estate market provided perhaps its healthiest year in 2017. A record number of transactions led to over $1.5 billion of total sales volume for the first time ever. This successful run was complimented by steady, though not excessive appreciation.
1763 residential transactions eclipsed 2016 by 7% as families elected to make an investment in a mountain lifestyle at record volume. Prices appreciated by a robust 8% over this period to $855,161, inching ever closer to pre-recession pricing, on a foundation substantially stronger than a decade prior.
Resort communities found consumers anxious for newer, well-designed homes within amenity-rich settings, and those communities saw exceptional growth with a 15% increase in transactions between $1,000,000 – $2,000,000. Conversely, premium product, $2,000,000 and above saw a slight dip in overall volume, likely the result of limited offerings after an exceptional 2016 run. Nevertheless, Martis Camp continued its sensational run with yet another year selling 40+ homes at values in excess of $4,000,000. The popularity of Martis Camp is all the more sensational given that average price within its gates has exceeded that of Tahoe lakefront properties for two consecutive years as qualified consumers opted for contemporary architecture and a direct connection to both Northstar and the Truckee airport.
Perhaps sensing a value opportunity, lakefront property saw more homes sell at more modest prices than in previous years.
An exceptional winter in 2016-2017 led to predictable results within resort communities. The Village at Northstar saw a 75% increase in transactions while the Stellar Townhomes found a sweet spot selling out 10 residences within 6 months.
No communities better represented the demands of the consumer in 2017 better than Old Greenwood and Gray’s Crossing. Each community offers a distinct personality but share an elegant design standard combined with an unpretentious sense complimented by family-friendly amenities. A diversity of product introduced in 2017 including the Legacy Collection in Old Greenwood and Fairway Townhomes in Gray’s Crossing provided consumers with optionality of size, style and pricing that was very well received. The sister resorts combined to sell 71 total properties.
Not every class of real estate was rewarded during this banner year. Vacant land languished in the face of rising construction costs as transaction volume dropped 8%. Developers perceived diminished value in land offers given thin construction margins to the tune of a 30% reduction in average land sale price. While new custom home construction remains abundant at the premium end of the market, numerous development projects have been deferred until market conditions provide less risk.
As a result, 2018 opens with the lowest volume of inventory on record with just over 3 months’ supply; a fairly dramatic tilt in the seller’s favor. A likely result of these unique conditions may be a slower than usual first half of the year while consumers wait for the right property to come available.
Nevertheless, conditions remain optimal for the continued pursuit of real estate in the region. As wealth and congestion grow unfettered in the Bay Area, the escape provided by time spent in the mountains becomes ever more precious.
TAHOE MOUNTAIN REALTY