South Lake Tahoe Market Trends

We’ve noticed a trend of interested buyers wondering when the best time to purchase a home is going to be in the South Lake Tahoe area. And of course sellers are always wondering when is the best time to put their home on the market.

Every market is unique and we feel the news media hype is not doing a good job of breaking down news for different market areas. Here is a graph that will hopefully help both parties evaluate the market more accurately in the South Lake Tahoe:

This graph shows how many months of home inventory on the market we have in relationship to how many people are buying them in the Tahoe area. “Inventory” refers to the number of homes that are sitting active on the market. The relationship between the homes sitting on the market and the homes actually being purchased is called the “absorption rate”.

Buyers:

If you are buying a home in South Lake Tahoe then you have more leverage as a buyer when the absorption rate is higher (20 months of inventory vs. 10 months of inventory). This is because with more competition, sellers have to be more competitively priced in order to sell. When the absorption rate is high, this is typically when we see prices dropping the most dramatically. We thought the attached absorption rate graph would be useful for you to know as you plan your Tahoe purchase.

Sellers:

Of course when the absorption rate is showing a lower level of inventory, this is when you are more likely to want to sell, as your odds of selling your home are greater. When the absorption rate is demonstrating fewer months of inventory, there is less competition, thus increasing the chance that a buyer will end up walking through your home and bringing you an offer. Now when the absorption rate is higher, it is important to note that these are the times when your home needs to be priced aggressively to sell. Your home has to look more like a “deal” and stand out from the competition as there is just way too much inventory on the market