January 2020 Market Update

Quick 2019 Recap: Due to another large winter and cold/stormy spring, the first half of 2019 was slower than usual but a steady summer and very strong Q4 made up a lot of lost ground. Overall the entire region was almost identical in units sold but down 11% in sales volume year over year. Median prices hit historical highs in almost all micro-markets within our service area except Tahoe City.


2019 started with inventory shortages and sellers who planned for the same gains as seen in the hot 2018 market; this resulted in many overpriced properties. So those buyers who were able to make the trek between storms were greeted with a lack of offerings and overly-optimistic seller prices. When combined with geopolitical concerns and constant talk of a “looming recession” many buyers became hesitant to pull the trigger. As you can imagine this took the shimmer off of the vacation-home buying process. However, at the end of the day it came down to sustained, incredible wealth in our primary feeder markets combined with ‘the right timing’ for families who want the Tahoe lifestyle incorporated into their overall well-being.


Properties priced in line with the market were in better negotiating positions and they sold well – average sold-to-list price was 96% and marketing times were short for these properties. A useful estimate: we saw multiple offers on roughly 10% of all transactions, mostly in the lower price bands but they did occur over $1,000,000, as well.


2019 had been predicted as a leveling-off year for real estate and 2020 is seeing similar forecasts. High employment and job growth combined with low rates will do battle with increasing home prices. Keep in mind, stock market analysts were saying similar things this time last year and the S&P closed 30% higher. There is little evidence showing potential for a major price correction or fundamental weakness in the 2020 real estate market but, of course, time will tell.


Spring has become the time of highest market appreciation and so with the experience of 2019 behind us and an election ahead, it will be interesting to see how inventory and pricing interact in this first quarter of 2020.

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