Strong demand from drive-to markets such as the San Francisco Bay and Sacramento and high barriers to entry are keeping the level of new housing supply to a minimum in Lake Tahoe. Our Vice President of Advisory Adam McAbee has been very active in the Lake Tahoe market lately, helping our clients establish value in an area with relatively few new home projects and a lot of diversity.
For perspective, the greater Lake Tahoe market is divided between two states and five counties and is represented in at least three different MLS systems, making its navigation relatively challenging. In addition, the Tahoe Basin’s governing body from a planning perspective (the Tahoe Regional Planning Agency, or TRPA) severely limits the number of new residential units that can be built in the area in a given year, and those units are then divided among these states and counties. What this translates to is an extremely challenging environment in which to gain entitlements.
A few projects that have entitlements and are likely to enter the market in near term include:
- Tahoe Beach Club – a 143-unit condominium development located just north of the Edgewood golf course in Stateline, Nevada, and the only new lake-front product to be offered in this market in decades.
- Clear Creek Tahoe – a private golf course and custom lot development located around what Golfweek calls one of the Top 100 Modern Golf Courses of all time. It is also located on the desirable Nevada side of the lake, between Glenbrook and Carson City, on the south side of Highway 50.
- Chateau at The Village – 30 condominiums (in phase one) located directly across from the Heavenly Village mixed use center and chair lift, just on the California side of the state line in South Lake Tahoe.
- Stellar Residences – 16 ski-in/ski-out residential units (six single family and 10 duplex) along the slopes of Northstar that were designed by the same firm that is responsible for designing Apple stores worldwide.
Aside from these projects and the rock-star Martis Camp (which is approaching sellout) and neighboring Schaffer’s Mill, the only major source of remaining new supply is unentitled, higher-density, long-term development around the California-side ski resorts (Squaw Valley, Homewood, Alpine Meadows, Northstar, etc.). The graph below illustrates the very low level of new home sales in Lake Tahoe in a given year (and the upward trend in pricing).
When coupled with elements such as the recently announced direct flights between New York and the Reno-Tahoe International Airport, the $150 million in recent improvements and renovations added in South Lake Tahoe, the favorable tax structure on the Nevada side of the Lake, and the fact that Lake Tahoe is one of the most beautiful lakes on the planet implies that demand will exceed supply over the long term.
Contact us to discuss how we can help in your challenging market.