Clearly, another factor in keeping the supply down is the conversion of thousands of homes to vacation rental.

Why would a seasoned broker not recognize and mention this? Perhaps it is because they are not really involved in this niche.

I personally know two people whose Tahoe homes (in the County, not the city) are underwater, having been purchased at the height of the boom, but they are renting regularly and indicate they are showing a net positive cash flow. I know that one of these owners is waiting for prices to rise, and intends to sell at some point.

Lack of homes for sale also indicates a lack of homes in the long term rental market, which is a huge detriment for the SLT economy.
Even when jobs do open in Tahoe, in many cases the incumbents cannot afford to buy a home in Tahoe, and become Nevada residents.
Teachers, police, fire dept employees working for Eldo County and the City are well represented in the “work here but can’t live here group”

The few affordable home developments in the area (no matter what you hear the politico’s saying) are not generally seen by the educated middle class as good places to raise families. These developments as often as not become the residences of retired folks or single people with lower incomes. Obviously these people are not the ones who support much Tahoe business with the exception of thrift stores, grocery outlet etc.

At the end of the day, it will likely be the built-out situation that drives real estate prices up, as TRPA qualified lots become fewer and fewer. I read in the last year or so that the Tahoe Basin is approx 80 percent built out.

I don’t know if this figure is accurate, but I have noticed a considerable increase in price for buildable lots. In any event it does not bode well for the re-establishment of a significant middle class ownership in our area.

Could this also be construed as people being satisfied with where they are. . .? Or, do we keep adding negative spin to ideas like they cannot afford to move anywhere else ?. . .prices are not consistent with a level that will allow them a reasonable equity (?). . .or is it that the real estate industry merely needs a supply to be able to create the demand. . .elsewhere, there’s am article heralding the idea that ‘bigger’ is now back in favor, as if the trend to McMansions will return, when it is the community values that need to be shored up economically, not the aggregate dollar amounts on the balance sheet of properties “sold”. . .

Kenny, even though this article isnlt about Vavation Home Rentals… since you brought the subject up i figured i could put my feelings on the subject in… I’m not going to talk about your statement that our residential neighborhoods are being commercialized, as I feel to really get to the bottom of that we would need an expert on zoning definitions and I am definate not educated enough on that subject to start a discussion and don’t want to just make assumptions.

I understand some people are upset that a large new home was built next to their house, or close by, and that the new home owners are renting the these houses out as vacation rentals and in some cases the people staying in the homes are being loud and upsetting the neighbors.

First, I want to explain that out of the 1800 or so vacation home rentals in the city of slt, only about 20% of them actually “make money”, in other words the income from renting is enough to cover all expenses (mortgage, maintenance, taxes, permits, utilities, and so on) and have money left over for the owner to put in their pocket or re-invest in something else. The other 80% of vacation home rentals either make just enough to cover their expenses or, for the most part, they operate at a loss with maybe 20% of the operating expenses being paid by the rental income and the remaining expenses being paid directly from the owner. These owners are people who have dreamed of having a vacation home in Tahoe they could bring their families to, maybe because when they were kids they remembered coming to Tahoe with their family. By being able to rent out their family vacation home while they aren’t using it, the little bit of rental income helps offset the expenses and without it they might not be able to afford to own their Tahoe family vacation home.

Of course there are some vacation homes that are fairly large (the term large is pretty vague but to me it is more than 3500 sqft and has 5 or more bedrooms), and some of these homes are used as vacation rentals. And of course the more rooms their are the more people the city permit allows to sleep there, which means the vacation home with 5 bedrooms will have more people staying in it on average when compared to a 3 bedroom vacation home. But it seems to me if the large home wasn’t being used as a vacation home and was used as a primary residence, most likely a large family would be the type to purchase it since they would need the larger number of bedrooms. Do you feel that a large family living in the home would be so different than groups occasionally using it while on vacation? I have a large family living next to me, and although I love them very much, they are WAY noisier than the vacation rental on the other side. And they are noisy ALL THE TIME, when the vacation rental only has people in it a few times a month.

Or is the issue not really that vacationers are using these homes vs. primary residents staying in them… but just because the houses are large (again, large is a vague term)?

My house was built in 2012 (so almost new), and is 2250 sqft. It could have been built much bigger into what would be called by some a McMansion. But we decided all we needed was 2250 sqft. Oh, and we are perminant residents and have lived in SLT for over 20 years. Sadly, one of our neighbors, who had a vacation home that they had owned for around 20 years, were very upset at our “huge house” being built right next to their vacation home, and they didn’t want to come up to Tahoe on vacation and look out the side windows and see our huge house. Funny thing is our house is only 50 sqft bigger than their home.

Basically what I’m trying to say is that you can’t generalize and say that ALL new homes are built as big as possible and ALL are being marketed as vacation rental homes. Many homes that are listed for sale will say if they are close to a school, if a lot of families live nearby (which could be seen as a negative to some who don’t like the sound of kids playing), and they will say if they are close to a ski resort, the lake, or the Casinos which are our major tourist draws. A real estate agents duty is to their client, and they have to market their clients home to the best of their abilities to try to get the house sold for top dollar… and with the vast majority of buyers looking for homes in SLT wanting a vacation home, it would be against the clients best interest for the agents NOT to market them as potential vacation homes. And unless I’m mistaken… isn’t ALL tahoe marketing in one way or another aimed at getting people to come enjoy themselves on their “Tahoe Vacation”?

As you can see, i am very passionate about this issue, and i feel that if we get a group together to really listed to each other, have an open and conciderate conversation, then maybe we can come up with some resolutions that will benefit our community as a whole.

(The percentages and other figures I used are based on information I have gathered over the past 12 years and from my personal experience with primary and secondary home owners, business owners, and property management companies)

Amanda-
You sound like you must be in the real estate business.
I have visited a few of the homes selling at 300 to 400K and basically I have to say they were pretty basic, or were disasters in some other way.

There are people listing homes in the low threes that don’t have a ghost of a chance selling them at the listing price.

Face it, the vacation rental business is only good for the owners of the rented homes. I do not know anyone who lives near one or more that say they love their part time neighbors.
You need to go study up on zoning and learn what is allowed in the basic zone map and what may be done by variance.
There are planning commissions out there who never met a variance they did not like, especially if the city is whispering in their ears about TOT etc.

There are clearly small hotels being built in residential areas, which will negatively affect the prices a prospective owner will be willing to pay.

Cranky; That is exactly what I am hearing from everyone on both sides.
Dog; If they all acted that way the issue would not be an issue. We are going to punish everyone for the few. Sad.
btw, I do not own any rentals.

4-mer and I consider ourselves extremely fortunate in that our part-time neighbors across the street who rent their house out as a VHR are great. They’re really nice people who bought a foreclosed house in serious need of repair, fully renovated the interior and exterior very nicely, landscaped the front yard with indigenous vegetation on a drip system, put in a bear box, and must really scrutinize who they rent to since every person has been polite, quiet, and extremely nice. They also furnished all the surrounding neighbors with several contact methods and have instructed everyone to call them anytime day or night if there was ever a problem.

Beats the heck out of the “family” that lived in that house before the present owners: long-time Tahoe residents with a loud mouth bully of a husband and father with a wife who was reduced to making excuses, 4 noisy kids with one being a teenager who liked to throw parties when he could get away with it, and two very large unruly dogs that were allowed to roam the neighborhood at will and attacked pedestrians, bicyclists, and other dogs. That was a very sad situation.

Spouse – 4-mer-usmc

P.S.S: Amanda – I also thank you for bringing a calm, reasonable voice to this issue.