Real estate data for the month of March gives a false sense of productivity within our market.
Closed sales reflect transactions agreed to 30-60 days prior. As such, March sales data give us an almost perfect snapshot of market conditions before the world changed in an instant. The month saw an identical number of transactions as the prior 30-day period and was a full 22% ahead of the same month in 2019 when copious amounts of snow shut down access to our region. Curiously, this confirms that strong market conditions were sufficient to overcome what had been a mild winter. Remarkably, both factors inverted in an instant as the closure of local resorts coincided with our most meaningful snow accumulation of the season. While this turn of events was torture for the mountain purists, it helped force us into an isolation that is more familiar; waiting out a storm.
Not unexpectedly, real estate sales activity has ground to a near halt out of necessity as our community takes shelter. As a result, we are forced to find different metrics to evaluate interest in our region and attempt to gauge what conditions may look on the other side. Using the various analytics available to us, we are seeing a massive surge in online real estate activity as would-be consumers use tools including virtual tours to preview Tahoe real estate. Understanding that some of this is idle curiosity, it remains a positive indicator.
The Bay Area’s close proximity and deep cultural connection have Tahoe in a position to rebound faster than many other destinations. Should our return from quarantine coincide with early summer, we may not be competing with many of the life events that occupy mindshare for our consumers including little league, and graduations. As well, trips to Tahoe feel more comfortable than travel to more exotic locations, all of which could see enhanced, early visitation to our region at the appropriate time.
Those in a position to acquire a second home may find Tahoe a safe choice; one that can lead to frequent visits and enjoyed on a moment’s notice. It is also likely that consumers will find that they are able to sustain productivity while working from a second home within the region.
Similarly, the confinement of urban or semi-urban life during this period may be a wakeup call that provides the push necessary to reevaluate the necessity of city living and contemplate a move to Tahoe that facilitates a healthier lifestyle while still allowing for maximum productivity. This is a trend already in place in the years leading up to this pandemic and may only accelerate such migration.
In an historical context, this period will be a curious void in productivity once we shake out the real loss of capital and return to a normalized market. In the near term, expect a relative void in productivity.
While this will undoubtedly impact longer range data, we are hopeful that the second half of 2020 will bear stronger resemblance to recent years.