Hello all and happy 2021!
This past year was quite remarkable in our local real estate market, and I wanted to do a quick review of the year as a whole. My last update covered the covid effects pretty well, so I just want to focus this update on market valuations and how they have changed through 2020. In a normal year, I would look at the average sale prices of all of the single family home sales in Tahoe Donner, and compare them with the previous year. In case you are new to my market updates, I use Tahoe Donner as a bellwether for all of Truckee because it represents such a large portion of the sales in the greater Truckee area, so these numbers are statistically significant. But this year, instead of just looking at 2020 vs 2019, because the market is changing so quickly due to unprecedented demand for homes, I broke the comparison down to the time periods of the 3 months ending 2019 with the 3 months ending 2020. So to be clear, I am looking at Tahoe Donner single family homes during those time periods. I will also be breaking them down into how the different types (sizes) of homes did in this market, and results are very interesting.
Lets look at how TD 3 bedroom 2 bath homes did for Oct-Dec 2019:
And the same homes for Oct-Dec 2020:
The smaller homes in TD were in very high demand in 2020. The average in 2019 was $596,317 while the average in 2020 was $784,333, an increase of almost 24%.
Next we will look at 3 bedroom 2.5 bath TD homes for the same time period in 2019:
And for 2020:
These numbers show a 31% increase in sale price year over year. This is an absolutely remarkable increase in value for 1 year.
Lastly, lets look at 4 bed 3 bath homes for Oct - Dec 2019
And for the same time period for 2020:
Here we see that these generally higher end homes rose by an average of nearly 19% year over year.
So where does the local real estate market stand right now? Here is an interesting stat - between the year I started real estate sales in 2006 until 2018, the lowest amount of single family homes that I ever saw as active for sale was 82. That is 82 homes out of around 5200 homes for sale at one time. As of the time I am writing this on January 7th 2021, there are 7 single family homes available in TD. The amount of demand for homes is like nothing I've ever seen, and there is very little inventory coming on the market to help at this time.
I think we can count on some spring listings, as we see every year. But I expect that number to be less than we would normally see. Will the strong demand continue? I expect it will all depend on the Bay Area economy. If things in tech remain strong, I expect it will translate to our real estate market. As I mentioned in a previous update, I watch Google Trends to give me a heads up on these kinds of things. Here is a chart from that site showing searches from California for "Truckee Real Estate"
It looks like after a lull in the late fall, we may be on an upward trend for interest from buyers.
At this point, I see no indication of the market slowing down from its meteoric rise. In order for the market to find some balance, we would need to see demand to drop sharply, and the amount of new listings to increase rapidly. That just isn't happening right now. I think that many potential buyers for this area are also invested in the stock market, with a higher than average exposure to tech stocks. So even if these buyers did not get into the market last year, they still may have a similar amount of buying power, even with prices up so much. This may partially explain why demand remains high even as prices continue to rise. It will be very interesting to watch what happens in 2021.
Thanks for reading the update, please feel free to reach out with any questions you may have. Thanks and Happy New Year!
Allison James Estates and Homes
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