A surge in housing demand from tech workers fleeing San Francisco begins to weigh on Lake Tahoe's real estate market as it now struggles to keep up with the demand.
Lake Tahoe real estate is experiencing an unprecedented surge in buying activity, bidding wars, and price growth, a CNBC report said. A wave of urban flight is causing a contraction in the inventory of homes for sales. Inventory of available homes for sales has shrunk to about a fifth to one-tenth of its usual levels, brokers say.
One such community where properties are being snapped up is the Tahoe Donner. This area would typically have about 80 to 120 homes available for sale. Tahoe Donner now only has about a dozen left. Buyers are particularly looking for larger homes that come complete with home offices. The home should also have more outdoor space for playing and other outdoor activities.
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All-cash deals boost Lake Tahoe real estate market
The buying surge being experienced in Lake Tahoe is larger than any real estate market has seen. Brokers say that people are making all-cash offers with either a few or no contingencies at all. Cash buyers don't seem to mind just as long as they can move out of the city. That, however, leaves those that need financing little chance to buy a home as sellers prefer to sell quick and all-cash.
Even empty lands are being snapped up because there is no more existing house to buy. Architects and local builders are seeing longer lines of requests for their service. Some brokers even resort to knocking on doors hoping someone gets persuaded to sell his house.
Work-from-home orders and the shifting of schools to online classes are also giving this unprecedented demand a boost. Such circumstances give buyers all the more reason to leave the city.
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Recently, Google announced that it is extending its work-from-home order through June 30, 2021. Other tech companies, including Twitter and Facebook, have allowed employees to work from home. Employees of these two tech giants can continue working from home indefinitely.
The report said that properties in this area typically sell in three to four months. That has completely changed now. Recent activities put the average days on the market to about four days. It would be normal now for properties to receive between six to 12 offers right after getting listed. Some would even close less than 24 hours after coming onto the market.
From the looks of it, it's not going to slow down any time soon, experts say. Pending sales of Sierra Sotheby from July 1 to 15 alone amounts to $129 million. That amount is already three times the total sold in 2019. In June, the firm's pending sales reached $191 million compared to $72 million in the same period last year.
While Tahoe used to be a market for vacation-homes. Buyers now see this location as a place where they can stay for the long-term.
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