STR Market outside Lake Tahoe?

Question

Hi All,

Just doing my due diligence and exploring all avenues for my future STR, but does anyone have any experience with STRs outside the Lake Tahoe region? Areas such as Pinecrest, Arnold, ect? If so, how has your occupancy rate been? Cleaning services, handyman, ect? Appreciate the insight!

Just wanted to explore in other regions since Tahoe is starting to regulate a bit harder these past few months. Still aiming for Tahoe, but exploring elsewhere.

Trish Mccoy · Answer

My first is 2 units - main house and cottage on 10 acres 5 miles from downtown Grass Valley - which I originally purchased as a 2nd home, $650K back in 2004.  Then turned them both into STR... I now live in main house and STR the cottage

In 2017 I purchased a 3 unit in downtown Grass Valley for $264K - got this smoking deal by sending a letter.  I put   5% down and seller financed the balance.

The next one was a two unit in Nevada City- main house and cottage for $575K - kinda a high end rustic luxury units

Then another was small 2bd 1 ba downtown Grass Valley home for $300K

And.. .I'm about to go into contract, hopefully on a home for $370K that can easily be turned into 2 units  It's the hottest market it's ever been here, and this property started out at $450K, then they reduced the price and it's still sitting because it needs work, and it located in half residential and half commercial area, plus on a busy street - so not ideal for some looking for a single family - but fits our STR needs perfectly. Plus seller is super motivate which is working in our favor.

We have a rental shortage in our area...so if for any reason the STR market takes a turn which I doubt we can always LTR as a back up.

Trish Mccoy · Answer

Hi Eric,

I don't have any in the areas you mentioned, but I personally have 8 units that are in Grass Valley and Nevada City which are just about an hour or so from Tahoe

Erik Bell · Answer

@Dustin Lauer - Such a small world! Born and raised in Pleasanton actually! Incline is awesome, love the north side of the lake. Agreed, thankfully I have some time to still raise some capital (about 3/4 of the way there). I am definitely in no hurry to buy, especially since A LOT of these properties are getting multiple over-asking offers. Tech/WFH in the Bay Area has definitely changed the dynamic, but as a Technical Recruiter (my day job), I am starting to see a bunch of these companies require their employees to sit back in the office later this year after COVID. I think this is the correction (if any) I will wait to capitalize on. No one has a crystal ball, but hopeful it will cool off somewhat in the future.

Dustin Lauer · Answer

@Erik Bell

That’s cool you’re from Pleasanton.

My sister in law lives there and we all went to Incline Village last summer.  It was cool to see how everything was booked and busy all they way around the lake.  You can check occupancy and organize your pro formas on some of the apps.  My general thoughts would be that you’d be buying at extreme peak highs now, but that more premium locations may be less volatile.  Hopefully you can find a good deal !

Mike B. · Answer

@Trish Mccoy

Trish what’s a typical purchase price for one of your STRs?

Erik Bell · Answer

That is AMAZING. Congrats on running a successful STR business! That is a phenomenal occupancy rate! Very true. I have been up there quite a bit actually and love that area, but didn't know you'd be able to get those rates. I imagine its much less regulations than whats being experienced in the Basin/Truckee. Again, appreciate the insight here. This has definitely got my thinking of other areas

Trish Mccoy · Answer

YES!!   I have about a 95-98% occupancy rate even in the Covid year - and this year is more.     People come up here to get out of the Bay Area and So Cal.   Lots of people are buying up here...people also come up here for Weddings, Yuba River, Wine Tasting, explore gold rush towns, lots of recreation etc...  And... we don't have the crowds or prices Tahoe has - just were are just 50 mi to Truckee

Erik Bell · Answer

@Trish Mccoy if you dont mind me asking, have you experienced decent occupancy rates given that its a ways out from Tahoe? Again, appreciate it

Trish Mccoy · Answer

@Erik Bell  Most of these are all STR - one if a LTR.

Erik Bell · Answer

Hi @Trish Mccoy thanks for the response! Are these STR or LTR? Thank you

STR Market outside Lake Tahoe?

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