November’s data demonstrated a Truckee-Tahoe real estate market where low supply and low demand resulted in minimal transactions.
Truckee-Tahoe residential inventory supply dropped slightly in November to 2.4 months’ worth of housing. For context, at ~5 months’ supply, the market is considered to be at equilibrium, meaning it’s neither a Buyer’s nor a Seller’s market. Still, this data supports the general prediction that the Truckee – Tahoe market is trending back to a more natural, pre-pandemic rhythm.
November median days-on-market ticked up slightly from just two weeks ago to 89 days, while the median price for a home also crept up to $1,895,000 (up $145K from that same time period). Total sales are up from last month 11%, with 88 homes closing in November (79 sales in October). At 88 total transactions, this is still low compared to our last “normal” market in 2019, when 133 homes changed hands (31% difference YoY).
It’s important to note that prices are up not because values are inherently increasing; rather, it’s due to the dearth of inventory creating scarcity coupled with some Seller’s still maintaining hard stances on their asking prices. As inventory re-enters the market and as Sellers abandon their arbitrary pandemic pricing, prices should come down slightly. Homes continue to sell below asking; for November homes sold, on average, 5% below asking. Buyers, please keep that in mind as you peruse properties.
A quiet market can prove to be advantageous for the stealthy buyer. Constrained inventory coupled with minimal buyer demand can create opportunities where none existed before (think pandemic market conditions).
The market should continue to trend toward a more Buyer-friendly landscape, but make no mistake, this isn’t anywhere close to a 2008-esque scenario – since today’s homeowners are well fortified with equity. This time around, any sort of downward pressure on home values is going to take much longer and is going to be far less substantial relative to 2008 losses.
The Truckee – Tahoe market continues to be a great place to invest in real estate, as the sheer utility aspect of owning a home in one of the most beautiful places on Earth has intense value, both tangible and intangible.
