The final remnants of a disruptive winter are visible in the performance of the local real estate market over the past 30 days. It may appear disingenuous to describe a market that lags sales volume of the prior year by 10% as ‘frothy’ however the first hints of summer activity have that feel.
May, 2017 saw 109 residential real estate closings; an excellent number by historical standards but a full 25 sales (19%) behind the same period in 2016. Factors divergent from the prior year include limited inventory and, more notably, a winter in which access to the region was limited based upon near historic snowfall. Appreciating that May closings are typically a function of March and April market conditions and, likely, January and February visitation, the challenge in showing real property is obvious.
Positive indicators for the season to come include limited inventory, currently at just five months’ supply, and a meaningful leap in average and median pricing. May saw the average sale price leap to $889,620, a 13% increase over the same month last year indicative of upward pricing pressure as well as a bias toward more premium residential offerings. The latter point is best demonstrated by a quick resurgence for premiere lakefront property. In a typical year, waterfront sales are back loaded to the final two quarters of the year as prospective owners experience the splendor of Lake Tahoe before making a purchasing decision. Already in 2017, 7 lakefront properties have transacted at median pricing nearly 40% higher than the cumulative 2016 values. Chief among these are two transactions cresting $10,000,000. With compelling inventory and a full lake, the lakefront niche is clearly in store for a banner year.
Similarly, the temperature for the overall market is rising. Memorial Day is typically a quiet time for new showings around Truckee and Lake Tahoe. More often, existing homeowners visit to ready homes for summer while consumers contemplate a visit around the July 4 holiday. The sensational winter and stunning weather inspired crowds far larger than normal to visit this year at witnessed by full restaurants and abundant real estate tours. 200 sales are currently pending in the Tahoe Sierra MLS of which 169 are scheduled to close in June. Among these are many properties that may have otherwise transacted during winter including the final Stellar Townhouse in Northstar’s Mountainside community, two other premium Northstar properties, a Martis Camp home, two Lahontan residences and a stunning custom home in Alpine Meadows.
Historical data shows a steady rise in residential sales month over month through Q3. Currently market dynamics appear to validate this trend driving toward a fourth consecutive $1 billion year for Tahoe Truckee real estate.