When people gather at a cocktail party and the topic of real estate comes up for discussion there is invariably one person in the crowd who spouts the old adage that the three most important words about real estate are location, location, location. While it is true that location is the primary factor affecting the value of a property there are a host of other considerations that will have an impact on what a property is worth.
In general you will find lakefront properties, specifically in Nevada, carry the highest values at Lake Tahoe. While there is an occasional oversized estate that will be priced comparable to a lakefront property, when comparing parcels of a similar size those that are on the water will carry the highest price tags. This is especially true if they have a parcel with private beach. If you have two identical properties at Lake Tahoe, the parcel in Nevada will virtually always have a significantly higher valuation than a similar size property located on the California side. This is a function of the California coastal access laws that grant the public the right to access beaches as long as people do not trespass across private property to do so. And properties with sandy beaches are considerably more desirable and have a higher value than rocky ones.
There are a host of other factors that will contribute to the determination of the value of any particular property. The second most valuable properties will usually be Lakeview parcels, and in general the bigger the view, the higher the price. This is not always the case since some panoramic Lakeview properties have very steep sloping lots, which makes the outdoor space virtually unusable. Also, some of the finest panoramic Lakeview parcels had homes built on them during the early stages of development at Tahoe. As a result, while the view could be spectacular the house might be a tear down which will have a negative impact on the total value of the property.
The Tahoe Regional Planning Agency has very specific land coverage rules that dramatically impact the value of any particular parcel. Depending on the slope, soil analysis, proximity to a stream zone and other criteria the available coverage can range anywhere from 0% to 30%. So, a relatively small quarter acre lot could potentially have more available coverage than a steeply sloping 1-acre lot. Since the TRPA coverage rules affect land capability, the ultimate square footage of the house along with decks and driveways will vary dramatically from parcel to parcel
Having a view of the mountains is better than no view at all, but being within walking distance to the Lake could trump that mountain view depending on the relative location of each property within any particular community. And don't underestimate the value of sunlight exposure because properties that face South or West and which are not shadowed out by the steep mountainside or dense forest will be more desirable and therefore more valuable than their lesser counterparts. Sunlight and slope also impact how quickly the snow melts off and whether or not your driveway will dry quickly when cleared after a winter storm.
Next we have to examine the structures on the property and look at their quality, condition, age, architecture, floor plan, number of stories, and the interior finishes. Every one of these factors will have a significant impact on what a particular property is worth. You could have two identical houses or condominiums side-by-side but one is nicely updated and lightly used while the other is in original condition with a lot of wear and tear. Zillow or other real estate portals try to estimate the selling price for both types of these properties. While they will be given the same fair market value, the reality is there could be a differential of 10% to 30%, or more due to our unique parcels. The type of remodeling done makes a huge difference based on the quality of materials and workmanship, whether it’s very personalized, neutral non-offensive and if it appeals to the mass market or only a narrow segment of buyers.
And let's not overlook who the neighbors are. Your house might be beautifully remodeled and in a fabulous location but if the owner next-door has a yard that resembles Sanford and Son your property value and the ability to sell it within a reasonable amount of time will certainly take a hit. Over the years this factor has made it difficult for a number of sellers to attract a buyer simply because the polite but untidy neighbor believes that the concept of private property rights allows them to maintain a junkyard in what is otherwise a lovely residential community.
At Lake Tahoe landscaping is in the eye of the beholder. Where some buyers may see a beautiful lawn and flower gardens, others will view them as a liability that requires maintenance beyond what they wish to incur. Oftentimes a natural landscape is more attractive due to the fact that it requires far less ongoing care along with a much lower water bill.
It's not possible in one short article to fully examine all of the different factors that affect property values. Even something as arcane as whether or not you have good cell phone coverage (which can be problematical with the mountain topography) can impact the value of a particular property. So, while the location word is of critical importance there are a number of variables that will determine the desirability and ultimately the fair market value of any particular property not just at Lake Tahoe but everywhere else, too.