When I started selling real estate in Tahoe eight years ago, my father congratulated me on making a wise decision. He said, of all the things I could sell, land is one of the safest bets…”They aren’t making any more of it!” This is true and very significant in Tahoe since there is almost no developable land left – it’s either protected by the Land Trust, owned privately, or belongs to the Forest Service. Limited supply is always a great part of the sales equation.
It’s pretty obvious that smart buyers are aware of this and are taking advantage of the opportunity that has presented itself as a result of the down-turn in land prices in the Tahoe area. The number below represent year-to-date data for land sales at Gray’s Crossing, Old Greenwood and Lahontan compared to sales over the same period in previous years:
There’s been a 30% increase in value (whether average or median) over last year and another 30% increase from year-to-date sold to currently pending; and the total sales volume up 60%.
I believe there are several reasons for this increase in land sales activity:
• The desire to own land in Tahoe never really went away, it was just on hold. When the real estate market took the down-turn homes became the more logical choice to purchase since you could buy for less than you could build. However, most of that inventory has all dried up and now it makes sense to buy and build. Not only are end users buying these lots, but the “spec” builders are back.
• Lower prices have made purchasing land in one of these resort communities affordable for families who previously only dreamed of building a vacation home in Tahoe.
• The values are too compelling to pass up, whether they’re buying for investment or for their own use to build a vacation home.
• When you compare these golf course communities(Old Greenwood, Gray’s Crossing, and Lahontan) to Martis Camp where there have been 61 lots sold this year for an average of $1,300,000, one has to ask themselves is there really a 190% difference in the lot values? In other words, the lots in these golf course resort communities are a compelling deal when their neighboring resort is selling lots for $600k to $2,700,000. As the old saying goes…”a rising tide raises all boats.”