Tahoe area property managers expect average summer
Northern Nevada Business Weekly
LAKE TAHOE “-After a slow winter that saw many vacation properties sitting vacant throughout the Lake Tahoe region, property managers at the lake expect summer vacation rentals will be average at best.
And that’s despite significantly lower fuel prices than in 2008 that might spur increased tourism at the lake.
Ken Viel has owned Incline Vacation Rentals with his wife, Karen, since 1997. The company manages 40 rental properties. Viel says bookings dropped roughly 50 percent last winter and started tapering off when the stock market began its bear run in September and October.
He’s optimistic, however, about this summer’s prospects. So far, Viel’s repeat customers have made their usual bookings, but advance bookings from new customers are down. New customers often make reservations through the Internet with little advance notice.
“Incline truly is a summer resort,” he says. “The usual suspects are all coming back, and we have a tremendous population base sitting on the other side of the mountains. Lake Tahoe is their playground. Even during tough economic times people still need to get away, so I am looking forward to a very good season.”
David Brunkal, chief operating officer for NAVIS, a Bend, Ore.-based software company that works with many Lake Tahoe-area vacation property rental managers to increase bookings, says that reservation dollars for June through August were running 12 percent behind last summer as of May 1, while average lodging rates had fallen 6 percent from a year earlier.
Only one-third of the available vacation rental rooms in Washoe County were occupied in the first quarter. According to room tax revenue statistics provided by the Reno-Sparks Convention and Visitors Bureau, of the nearly 20,000 available vacation rental rooms in Washoe County ” the vast majority are located at Lake Tahoe ” just 6,369, or 32 percent, were occupied in March. In February occupancy was 36 percent, while in January occupancy averaged 37 percent.
Brunkal says that first-quarter revenue for most rental properties at Lake Tahoe dropped 14 percent from year-earlier figures, while average lodging rates decreased 9 percent.
Viel says reservations for vacation properties began slowing in 2006, a trend that continued through 2007 and 2008 as consumer spending tightened.
“People have reined in their budgets, but they still need to vacation, and we are just short drive away,” Viel says.
Jim Morris, owner of Lake Tahoe Accommodations with his wife, Melinda, manages more than 300 properties around the Lake Tahoe region. Morris says the proliferation of Indian gaming in northern California has impacted Tahoe’s tourism numbers, but the grandeur of the Sierra will always be the region’s trump card.
“Lake Tahoe has something no other vacation area has in the world, so we are blessed,” he says. “We have the lake, and it is the purest, cleanest water in the western hemisphere.”
Lake Tahoe Accommodations, which operates five offices around the lake, does the bulk of its business on the South Shore due to the casinos and three major ski resorts. The company saw a 20 percent drop in business during the first quarter due to weak snowfall totals, but Morris says advance bookings are on pace for July. Though reservations for August are softer than expected, Morris says many customers just don’t book Tahoe vacations months ahead as they did in the past.
Vacation stays have gotten shorter as well.
“I think it is going to be a B-minus summer,” Morris said. “Traditionally people would spend a week or two weeks at Lake Tahoe, and now they are coming up for four days or a weekend. They are coming more frequently, but we are not getting some of those longer stays that we used to have.”
Vacation rentals by individual homeowners who bought real estate during the boom years and now are renting those properties out also has slowed the market for vacation property managers, Morris notes.
To lure new customers, bring repeat customers back to their properties and give added value, property managers often offer a free night for extended stays. At Incline Vacation Rentals, Viel typically gives a Sunday or even Thursday night for free for customers staying Friday and Saturday nights.
“They get the opportunity to stay late Sunday, have an early dinner and go home after the crowds or even spend the night,” he says. “Everyone is looking for bargain or a little extra ” even repeat customers have asked for deeper discounts this year than in years past. But I appreciate repeat customers and try to take care of them any way I can.”
Lake Tahoe Accommodations typically offers a free night for six-day or three-night stays. “We know the economy is real soft, and everybody is looking for ways to conserve money,” Morris says.
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