Author Topic: anyone own rental property in lake tahoe area?  (Read 858 times)

i_have_so_much_to_learn

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anyone own rental property in lake tahoe area?
« on: September 23, 2019, 04:07:14 PM »
I'm curious about what the hidden costs are to owning there. How is the winter and such?

thanks,

FINate

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Re: anyone own rental property in lake tahoe area?
« Reply #1 on: September 23, 2019, 05:03:41 PM »
My in-laws owned a vacation rental property in South Lake for a few years.

The biggest costs are not hidden: mortgage, property taxes, insurance.

In recent years insurers have dropped policies or jacked up premiums. Catastrophic fires forced them to reassess risk, especially urban areas near forests. This can be very expensive now, especially if you end up having to go with the insurer of last resort, the so-called FAIR plan.

Management fees: Depending on details of your plan, you may need a property manager. Figure about 8% off the top of rental income.

Heating: You'll have to heat the house during winter even when unoccupied or the pipes will freeze. Cost depends on size and efficiency of house.

You may need to pay for someone to clear snow from your driveway/road. Actual cost depends on who owns the road and if you're willing/able to clear you own driveway (clearing "Sierra Cement" weeks or even days after it falls and compresses is no fun).

Assuming there's landscaping, you'll need to winterize the yard every fall and then get it ready again in the spring.

More generally, the amount and duration of snow is hard on structures, so be prepared for increased maintenance costs.

If they rented it very aggressively, and during the peak season, then they'd almost break even. But then they couldn't use it when they wanted to. Seemed pointless to lose money on a property they couldn't really enjoy, so they sold.

Dave1442397

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Re: anyone own rental property in lake tahoe area?
« Reply #2 on: September 24, 2019, 02:52:04 PM »
You can also have bear issues. The bears aren't afraid to roam the area and break into houses if they smell food. My sister-in-law had neighbors who rented and refused to use a bear-proof box for their garbage. Almost every week a bear would rummage through their garbage and leave trash spread all over the yard.


Dicey

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Re: anyone own rental property in lake tahoe area?
« Reply #3 on: September 26, 2019, 11:08:20 PM »
Traffic. OMG, the fucking traffic getting in and out is awful.

i_have_so_much_to_learn

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Re: anyone own rental property in lake tahoe area?
« Reply #4 on: September 27, 2019, 12:17:18 AM »
Thanks so much everyone!

M5

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Re: anyone own rental property in lake tahoe area?
« Reply #5 on: October 04, 2019, 02:31:47 PM »
Traffic. OMG, the fucking traffic getting in and out is awful.

^^Haha, yes this for sure. At least if you're coming from the West. Coming from NV is usually fairly tame. Reminds me of the mess in Truckee last winter when I-80 shut down on a Sunday morning and didn't open again until Monday afternoon. People thought they could get one last turn in - instead 70,000 people got stuck between Squaw and Truckee in the middle of a 3ft dump. The amount of unprepared and inexperienced winter drivers that come to Tahoe never ceases to amaze.

You also need to do research on the short term rental policies for the city of South Lake, and even for spots on the North shore. SLT has especially gotten much more strict with their laws/tolerance of short term rentals in the last few years.

I'd say the vast majority of vacation rentals in Tahoe are owned by rich folks from the Bay area who are just looking to minimize their ownership costs by renting it out when they aren't there themselves. If you're looking for a vacation home that you can minimize your losses on, this might be a good avenue. Otherwise it's probably foolish to purchase something in this area solely as an investment property.