The Tahoe Truckee real estate market continues to show signs of a meaningful rally in activity yet remains constrained by painfully thin inventory. February 2023 posted results nearly identical to January in volume but edging slowly upward in value.
52 residential transactions is a woefully low figure, even for the historic trough of any given year. This would be easy to ascribe to waning or saturated demand were listing inventory swelling or prices falling. Instead, the quantity of listings has dropped for 7 consecutive months and currently stands at a razor-thin 206 residential offerings. This is the lowest figure since February of last year; near the apex of the frothy post-pandemic market run when absorption was being measured in days and weeks. The current supply would be exhausted in just 2 months at the current rate of activity.
The average home sale in February increased month-over-month by nearly 5% from $962,500 to $1,009,500. The smaller sample size may contribute to greater volatility when measured in 30-day increments however February’s results follow very typical patterns. To date, approximately half of all residential transactions have been at prices greater than $1,000,000 consistent with 2021 and 2022. Leading the market over this period were resort communities, including Martis Camp, Lahontan, Gray’s Crossing and the Village at Northstar.
The heavy snowfall currently inundating the Tahoe-Truckee region creates a complex dynamic for real estate activity. Sierra storms deliver the product that creates the demand for our region however weather events can render the actual act of touring property entirely infeasible for days on end. Ultimately, a healthy snowpack and watershed will provide longer, stable seasons with plenty of time to satisfy demand if the requisite supply is available.
The typical rhythm of any given year in our resort communities will see the greatest swelling of new listings come to market once most resorts shut down operations in late April through June. This stands to reason as homes show optimally allowing for opulent photography and longer days for touring. However, savvy sellers willing to come market when competition is absent are often rewarded with stronger transactions and potentially greater yield versus those that follow the conventional path standing shoulder to shoulder with competing listings.
The extended winter, now virtually guaranteed with snowpack at 150% or greater than full season averages, will undoubtedly drive increased visitation to the region for the remaining 6 weeks of ski season. Until listing inventory accelerates, market results are likely to look substantially the same as the opening months of 2023. A much livelier Q2 – Q4 appears in store.