Amid housing crisis, North Tahoe-Truckee real estate sales thrive
Visit ttcf.net/impact/regional-housing-study to read the full 424-page study as well as an 18-page summary on TTCF’s website.
Tell us your story: Have you struggled with housing in Truckee or Tahoe? We want to hear from you. Email reporter Amanda Rhoades at email@example.com or tweet her @akrhoades.
TAHOE-TRUCKEE, Calif. — While the recent regional housing study shows that more than half of Truckee-Tahoe’s workforce commutes to the region from other locations, real estate sales in the area are on the rise.
“The majority of the buyers in our area are second homeowners, vacation homeowners, investment buyers,” Ellen Grace, president of the Tahoe Sierra Board of Realtors and a Realtor with Coldwell Banker in Truckee, said in a recent interview.
Grace said that though there are some local residents looking to buy homes in the region, it’s less common.
“What they’re looking for is something that’s going to give them access to the great outdoors here,” she said. “We get a lot of families, as well as single professionals.”
She said that many home-buyers in the Tahoe-Truckee region have stressful jobs in places like Sacramento or the Bay Area, and are able to come here for about one month out of the year.
Grace characterized the current market as “very robust,” and said that 42 percent of sales so far this year (through August) were for homes under $500,000.
The Tahoe Sierra Board of Realtors covers the California side of the area, including Tahoe’s North and West shores, Olympic Valley/Alpine Meadows, Truckee, Tahoe Donner, communities throughout the Northstar region and other locations in Sierra County.
Grace said 37 percent of home sales were for mid-range properties (between $500,000 and $999,999), and homes priced at $1 million and up, which are classified as luxury properties, accounted for 19 percent of sales.
Distressed properties, she added, constitute less than 2 percent of total sales.
‘GOOD TIME TO BE A SELLER’
Despite luxury properties performing well, the number of homes available for sale in the region is declining.
“If you’ve got a property, there’s a demand because there’s less to choose from,” said Grace. “It’s a good time to be a seller.”
She said there isn’t much developable land left in the Truckee-Tahoe region, and that there are currently investors and locals all looking to buy homes in the same place.
“We have a 12 percent decline in the number of homes for sale … but the area is growing and there’s only so much land,” she said.
Grace said that locally, the median home price across all three categories (entry level, midrange and luxury) within the Tahoe Sierra market footprint is $565,000 — an 8 percent increase from last year.
According to the Tahoe Truckee Community Foundation’s 2016 Regional Housing Study, the Department of Housing and Community Development lists the maximum sale price for a four-person, lower-income home to be considered affordable at $235,000 — that figure is based on statewide data, which isn’t exactly indicative of the Tahoe-Truckee market.
For example, the median income for a four-person household this year in Nevada County is $73,500, and in Placer County, it is $76,100, according to the California Department of Housing and Community Development.
The statewide median family income this year in California, according the U.S. Department of Housing and Urban Development, is $70,000.
The Regional Housing Study also reports that roughly 65 percent of homes in the North Tahoe-Truckee are vacant most of the year, primarily used for vacation homes.
‘MASTER AND SERVANT’ ECONOMY?
Nick Pullen, owner of Truckee-based Pullen Realty Group, told the Sierra Sun that although his business does mostly vacation property management for second homeowners in the Tahoe area, he thinks more can be done to accommodate the housing needs of locals.
“I would characterize the Truckee-Tahoe economy as a ‘Master and Servant’ economy, where second homeowners are the masters, and most people in Truckee make their living servicing them,” said Pullen.
He said that while environmental conservation efforts are necessary to protect the region’s beauty, he believes that local officials need to encourage responsible, higher density developments.
“Our economy is heavily dependent on all things real estate, where people finance it, appraise it, sell it, design it, engineer it, approve it, build it, rent it, clean it, maintain it,” he said.
Pullen said that almost every person he knows is involved in one of these businesses that can be tied to real estate. Still, the real money lies in owning real estate.
“Without attracting higher-paying jobs and capitalizing new businesses that are outside of the real estate and tourism industries, local incomes will continue to stagnate,” he said.
Another factor is growth the past couple years of short-term vacation rentals through companies like AirBnb, HomeAway and VRBO.
Adam Annen, a spokesperson for HomeAway and VRBO, said the Truckee-Tahoe region is no different, adding that VRBO listings here have increased 135 percent over the last year.
“It appears to be a very healthy market for vacation rentals, with demand significantly outpacing the supply,” Annan said.
He added that the average homeowner, nationwide, makes about $28,000 a year renting their home to visitors.
As of Sept. 12, there were 3,200 active VRBO listings in North Tahoe, according to the company’s spokesperson.
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