Tech-rich buyers help Tahoe real-estate rebound
Some buyers from the tech industry have snapped up vacation homes recently that run from $1 million to $4 million or more.
San Jose Mercury News
SAN JOSE, Calif. — Lake Tahoe real-estate agents, hungry for sales in the aftermath of the housing bubble, are counting on the Bay Area's booming tech industry to help generate the next crop of million-dollar vacation homebuyers.
The market for vacation homes costing more than $1 million, though down over the year, turned in a strong third-quarter performance, according to Coldwell Banker. That was partly due to buyers from Silicon Valley, developers and real-estate agents said.
"People are starting to feel a little bit better about things. Silicon Valley is kind of spearheading that revival. We're seeing those folks make their way into the Tahoe market," said Jim Telling of East-West Partners, the developer of Home Run at Northstar.
Some buyers have snapped up vacation homes recently that run from $1 million to $4 million or more.
For example, more than 20 parcels at Martis Camp — a 2,100-acre custom lot development between Truckee and Northstar — have been scooped up by employees of Google, Facebook, VMware and Apple, according to the development's spokesman.
One Apple employee bought at Home Run, a small mountainside ski-in, ski-out village of town homes, where luxury real estate sells for $1.75 million to $2.2 million.
Another Apple employee sold some stock and purchased a place at Incline Village, reportedly for $3 million.
And a company, VirnetX, is moving to Tahoe after its CEO bought a $6 million house on the Nevada side.
Last, but not least, Oracle CEO Larry Ellison is putting the finishing touches on a lakefront compound at Incline Village. Ellison reportedly spent $58 million to assemble an 8-acre spread. The site has several buildings, a pond, a waterfall, tennis courts and a sandy beach with two piers.
"I think the world's starting to right itself again," Telling said. His development's first eight homes are under construction on the mountain near the 170-room Ritz-Carlton Hotel, which opened in 2009.
The Bay Area has always supplied a big portion of Tahoe buyers.
"It's good for a long weekend," said Andy Bechtolsheim, one of Ellison's neighbors at Incline Village. Bechtolsheim, an angel investor and co-founder and chairman of Arista Networks, said he's been going to Tahoe for 20 years.
"It's good for kids. It's not as upscale as Aspen but I would say it hasn't lost its traditional charm. It's gotten a little bit more crowded during the busy season, but I love the offseason there. I was there a few weeks ago in October. There was nobody there. The leaves were changing. It felt like fall going into winter."
But until recently, the economic downturn had discouraged many buyers, while falling prices kept many sellers off the market.
Now, according to Ernst & Young, 25 Bay Area tech companies are preparing initial public offerings, providing new hope to local real- estate agents.
"Silicon Valley IPOs Cash for Tahoe Home Buyers" was the headline on an October blog post by Lexi Cerretti of Intero Real Estate Services at Incline Village.
"With social-gaming leader Zynga and social-giant Facebook likely to go public in 2012," she wrote in her blog, "we will see a new breed of millionaires emerging in the Bay Area homebuying market. ... An influx of cash into the hands of new buyers could give sellers the opportunity they've been waiting for this winter into 2012."
Cerretti said she's visited Intero's Silicon Valley offices in anticipation of a future Tahoe boomlet. "Many of the showings on my high-end properties are buyers who have come up from the Bay Area, specifically from Silicon Valley. I have had two great buyer referrals in the past week from our Intero office in Los Altos (Calif.)," she said in an email.
Adele Lucas of Chase International said she closed a deal this month for just over $3 million.
"Right now, I am extremely busy with lakefront sales," she said. "We're seeing those affluent buyers coming into the high-end market because they recognize these prices are artificially low and are going to be pumping up in the next few years as the market and economy strengthen."
Craig Zager with Coldwell Banker Select on the Nevada side of Tahoe said he has had several lakefront sales this year to Bay Area residents, including the CEO of VirnetX, the 12-person Scotts Valley, Calif., firm. VirnetX has sued Microsoft and others for infringement of patents it acquired from SAIC, a major defense contractor. Microsoft settled for $200 million last year.
"Most of the communities around the Bay have not seen distressed markets like the rest of the state or country," Zager said.
Buyers "come in with a different attitude, just looking for the right property, and they write a check."