South Lake Tahoe STR
Howdy BP Community!
We're researching the possibility of operating a STR off highway 50 in El Dorado county, just outside of the TRPA. I'd love to talk to somebody who operates up there to talk about management issues, fire insurance, and rental potential. Anybody have a few moments?
Many thanks in advance!
I have no idea but am interested in following up on this thread to see our fellow investors' points of view.
Me too. I would love to have STR in the Tahoe area but also curious about this topic whoever own one here and is doing ABNB.
El Dorado County has a waiting list of 110 people as of the first of January. There is also now a 500 foot buffer, so even if you were to get through the waiting list and there is another short term rental with 500 feet they will not issue you a permit. If you go to El Dorado Vacation Home Rental website there is a map and a lot of good information, they update the number of people on the waiting list every so often.
As for other areas around Lake Tahoe. Placer County is not issuing any new permits until April 1st, 2022. But if you buy a home that has an existing permit, it can now be transferred. Washoe County, which is Incline Village allows short term rentals. Where you could run into an issue is if the HOA doesn't allow for it, which is the case in some condo complexes. The town of South Lake Tahoe has banned them except in "tourist core" areas. And Douglas County has a cap on the number of rentals and they hit their cap last summer, not sure where they are with a waiting list.
Feel free to DM me if you have more questions!
Thank you Lindsay.
I spent a good amount of time on the El Dorado county website, but did not find the specifics you provided. I appreciate your insight. Is there a permit limit for El Dorado county? Or are they just backlogged?
@Lindsay Buchanan If you have any vocational home listing that for sale and able to transfer permit, can you DM me?
Thanks.
Here is the link to the website: https://www.edcgov.us/Governme...
There is a 900 short term rental cap, it is not a backlog.
Originally posted by @Lindsay Buchanan:
Here is the link to the website: https://www.edcgov.us/Governme...
There is a 900 short term rental cap, it is not a backlog.
To be clear, it appears that the cap only applies to properties within the basic jurisdiction, while the buffer is county-wide.
@Matt Huber correct, the 900 property cap applies to the Lake Tahoe Basin. And the 500 foot buffer is county wide, inside and outside of the Lake Tahoe Basin.
Good summary @Lindsay Buchanan! I'm in Incline Village on the Northern (Nevada) side of the lake and while STR's are still allowed here, I understand they're gong to start limiting the number of permits being issued. If you can afford to 'get in', I wouldn't wait!
-
Real Estate Agent DC (#AB98363971), MD (#580520), VA (#0225072524), and Nevada (#BS.01458761.MGR)
The permit cap for El Dorado County is only for inside the basin. The 500 foot buffer rule is for the western slope also. The City of South Lake Tahoe banned vacation rentals in Residential neighborhoods. This means they are still allowed in the Tourist Core, Commercial zoned areas, Town Centers and any area zoned anything other than Residential.
Douglas County has a waitlist that is lottery based. They will take new applications for that waitlist during the month of July every year and they have a lottery to determine the order in which permits will be given. If you don't get a permit that year, you have to reapply to the waitlist the following July.
There are some challenges to getting a STR inside the basin but I believe any STR in the basin will be much more lucrative than buying something on the West Slope especially with Sierra at Tahoe closed this winter and all the fire damage down there.
@Dustin Allen Thank you for chiming in. Really appreciate the feedback.
Ok, I was looking at the map on the El Dorado County VHR website. Just want to make sure I'm reading this right. The white translucent area is the 500 foot buffer for an existing VHR permit, right?
Correct.
Unfortunately, or fortunately there is a reason why all the county jurisdictions are limiting STR permits. It's gotten to the point in North Lake Tahoe area at least that there is no one to work at the restaurants, businesses and service industries and many restaurants have limited hours because they can't find workers. Employees have been forced to find housing in Reno (45 min-1hr away on clear days) and although many still make the commute it isn't reasonable for many and treacherous when there is snow. There is a balance and until the housing shortage is resolved, I agree there has to be limits but I've been hurt by this as well. Frankly, long term renters are much more respectful and it's much easier to manage. Finding people to clean and turnover an STR is not easy these days unless you turn it over to a management company for their fee, and many of them are falling short as well.
@Matt Huber In addition to my previous comment. Please be sure to research your fire insurance possibilities very carefully. Property owners are non renewed every day. The insurance on my 1100sf rental home was not renewed this year and went from $2100 to $3850. Most property owners are forced to go through California Fair Plan (set up by the California Insurance commission) for their fire dwelling and then buy a secondary for liability and are paying anywhere between $5-10k for coverage annually. Have a very good insurance agent who knows the possibilities, it changes every month. The rental potential is very seasonal. By mid April, the ski vacations are thinking about other things and staying in the bay area and enjoying the green. It picks up again maybe for Memorial Day weekend, sporadic in June, July, August book and then it starts dropping off in September again when kids are back in school. October and November are very sporadic. So don't depend on your STR being booked full time. Do a realistic cash flow analysis before purchasing. Good luck!
Thank you Niobe for the great info.
I did look at fire insurance, was quote about $5500/yr.
It was fun to think about operating an STR up there, but I'm not going to touch it with a 10 foot pole. Between the regulatory environment and fire insurance uncertainty, I'm out. For those who got in early, at a lower price point and got their permits before the quotas and buffers, it's probably worth it to keep going. But for a new entrant, this would be an endeavor of passion, and not of steady, sustainable YoY cash flow.
Best of luck to all who are doing it, and thank you again for the advice. For me, this was a shiny object; I'm sticking to long term rentals in cash flowing markets.
@Lindsay Buchanan do you specialize in str in South Lake Tahoe?
@Lane Chomko I mostly work in North Lake Tahoe and Truckee, both on the CA & NV side.