Tahoe Vacation Rentals

of one

Tahoe Vacation Rentals

Even though US vacation properties had an overall lower demand in 2020 and the start of 2021, the Lake Tahoe area had increased demand and revenue during this period. Lake Tahoe regulations depend on each of the counties of California and Nevada in which the lake is located. These regulations have had changes in recent years. Some of the best vacation rental management companies in the area include Hauserman Rental Group, Tahoe Signature Properties, and Tahoe Alpenglow Properties. The complete overview of Tahoe vacation rentals is provided below.

Vacation Rental Property Market in Lake Tahoe

Information regarding the current state of the vacation rental property market in Lake Tahoe is scarcely available in the public domain. However, we are providing the most relevant available information and hard data regarding this market.
  • According to US real estate agents, vacation rental properties located in different outskirts of major cities, including Lake Tahoe, "have been fully booked months in advance or, in some cases, have been taken off the rental market entirely," as people were expecting a rise in bookings as a result of the COVID-19 pandemic improvement. Hence, consumers currently searching for these properties have, reportedly, very few available options.
  • In December 2020, the Lake Tahoe area's short-term rental revenue per available room (RevPAR) was up 67.4%, compared to the previous year.
  • Lake Tahoe's ADR (average daily rate) increased by 12.3% from January 2020 to January 2021.
  • The area increased its March 2021 short-term rental occupancy by over 30% in one year.
  • Vacation home year-over-year sales in the area increased by 80%. Experts think that the coronavirus pandemic is responsible for encouraging Americans to "invest in a getaway property," and that most of these purchases are "for income purposes." Covid has offered people work-from-home flexibility, and online services, such as Airbnb ABNB and VRBO, are facilitating the rent of homes.
  • Realtors of the Lake Tahoe area forecast that homeowners "will see their property value skyrocket" and that they will continue to sell and experience a post-pandemic 'uptick.'

Regulatory Environment for the Vacation Rental Property Market in Lake Tahoe

Within the Lake Tahoe region, there are two states and four counties which have their own rules, regulations, and requirements to secure permits. Available information regarding each of these counties' vacation rental properties regulations is provided below.

California - El Dorado County

The largest city in this county is the City of South Lake Tahoe, with a population of 22,197 (2019). South Lake Tahoe is also the largest city around Lake Tahoe.

Measure T
  • Measure T is a "citizen-initiated ballot measure that amended City regulations on vacation home rentals (VHRs) in South Lake Tahoe." It requires the "phase-out of all VHR permits in residential areas and all multi-family properties over a three-year period" and be dully implemented by December 31, 2021. It "prohibits the issuance of new VHR permits in residential areas."
  • Measure T allows owners with a permanent residence of the City of South Lake Tahoe to vacation rent their properties for up to 30 (consecutive or non-consecutive) days per one-year permit period.
Hosted Rental Ordinance
  • In November 2020, the South Lake Tahoe City Council released a hosted rental ordinance that allows qualified homeowners or tenants "to rent a portion of their home."
Number of VHR Permits
  • In December 2020, the El Dorado County Board of Supervisors passed an updated vacation home rental (VHR) ordinance for the Lake Tahoe area regarding a new "ceiling on the number of permits allowed." The ordinance limits the number of VHR permits to 900. Currently, the area has about 750 approved or pending permits of this kind.
Tax Regulations
  • Hosted short-term rental owners in South Lake Tahoe "must collect transient occupancy tax (TOT) and the South Lake Tahoe Tourism Improvement District fee from guests and remit the tax to the city monthly. "
  • Unincorporated El Dorado County short-term rental hosts must also have a TOT registration certificate, collect TOT from their guests, and file TOT returns.

California - Placer County

2020 New Regulations
  • In January 2020, new regulations including "a new permit for homeowners looking to run a vacation rental on their property," defined quiet hours between 10 pm and 7 am, and required bear bins for garbage on-site, were established for vacation rentals in Placer County. The ordinance only applies to properties above 5,000 feet in elevation.
  • The new ordinance also establishes that after 10 pm, a vacation rental can have a maximum of two adults per bedroom, plus two additional people excluding children under 16.
  • Also, "outdoor wood-burning fires and charcoal grills are banned from vacation rentals, on- or off-site parking is required, and property owners have to designate a local point of contact who can quickly respond in person to any complaints about their guests."
  • Permits for privately operated properties will have a cost of $337 and for professionally managed properties $200. These fees will help cover the administration of the short-term rental program and fire inspection costs. Permits will have to be renewed each year.
Certification of Compliance
  • Placer County requires that owners of vacation rentals "certify in writing prior to permit issuance that they are in compliance with the new rules," including having fire safety equipment, defensible space requirements, building code compliance, and parking storage, among others.
  • Through a third-party company, the county identifies unpermitted short-term rentals (STRs). Those that do not have a permit are subjected to "potentially significant fines," which can be as high as $500 per day for new violations and $1,000 per day for subsequent violations.

Nevada - Washoe County

New Regulations
  • In March 2021, Washoe County adopted a new ordinance, to take effect in August 2021, focused mainly on Incline Village, a small community of about 8,700 residents that represents about 90% of the county’s short-term rentals.
  • This ordinance establishes a permit system, sets property occupancy limits and quiet hours, and re-enforces rules about parties, parking, and litter.
  • The new permit system "includes an annual permit fee and infrequent property inspections."
Current Regulations
  • Occupancy limit is based on individual characteristics of the dwelling unit and property. It is calculated as one occupant for every 200 square feet.
  • Annual permits for STRs allow flexibility to the owner regarding the limit on rental nights per year.
  • STRs are required to have a designated agent or property manager who is available 24/7 to respond via text message or phone to issues related to the STR within 30 minutes of contact by Washoe County and be based in a location that allows them to physically arrive at the STR within one hour.
  • Short-term rental quiet hours "are proposed to be from 10 pm 7 am." However, the county does not have strict noise standards.
  • No events or parties "are allowed or may be advertised."
  • If an STR owner has 3 confirmed violations in 12 months, he will receive a one-year revocation of the STR permit.
Tax Regulations
  • The RSCVA assesses a 13% room tax on STRs in Washoe County. The RSCVA keeps a portion and distributes the rest to different government agencies. Washoe County receives 1/13th (about $125,000 annually) of the room tax paid in unincorporated County areas.

Nevada - Douglas County

  • In October 2020, a home rental task force asked Douglas County to limit the number of home rental permits to 725 properties in its Lake Tahoe area. As of March 2020, there were 533 active permits.
  • In February 2021, Douglas County stopped issuing VHR permits in the Tahoe Township area until a future meeting in March. The county commissioners had been discussing changes to the current VHR regulations. Apart from capping the number of permits, they are also looking to "creating buffer zones to prevent VHRs from being clustered together" and making VHRs illegal "in HOAs and GIDs that don’t allow for commercial use in their bylaws."
  • County commissioners also proposed a $20,000 fine and permanent ban to operating vacation home rentals in Douglas County that don't have a permit.
Current Regulations
Permit Fees
  • Permit fees include a new application fee of $400, a technology fee of $16, an inspection fee of $150, and a processing fee of 2.9%.

Tahoe Regional Planning Agency

Mortgage Payment

There is scarce information in the public domain regarding regulations of paying mortgages solely with rental income. However, we found evidence that in the US in general, people could be able to pay all of their mortgage with rental revenue.
  • According to Socotra Capital, "as long as the property is located either near a large body of water and/or in a popular tourist destination—such as Lake Tahoe or San Francisco—it’s very realistic for property owners to pay the entirety of their mortgage with rental revenue."
  • A recent survey of homeowners who rent out their homes on a popular online platform revealed that 70% of them affirmed that they could pay over half their mortgage with rental income.

Best Vacation Rental Management Companies in Lake Tahoe

Most vacation rental management companies provide services to specific areas of Lake Tahoe (e.g. North Lake Tahoe area, California area, etc.) We are providing those companies that, even though they only cater to some part of the Lake Tahoe area, have high user ratings in the public domain.

Hauserman Rental Group

  • This company was considered as one of the best because it is highly rated by users on different platforms including Yelp, Birdeye, and Facebook.
  • Its services include 24/7 assistance, housekeeping and maintenance, monitor and notification of the condition of the property, bookkeeping and records, marketing and advertising, and property pricing monitoring. The company's services are available in "the California side of Lake Tahoe, on the North & West Shores of Tahoe along with ski resort areas at Squaw Valley and Alpine Meadows."
  • The company requires "an initial setup fee, plus an annual marketing fee and commission from rental proceeds. Fees may be charged for additional services." Management fees range between 15 to 50%.

Tahoe Signature Properties

  • This company was considered as one of the best because it is highly rated by users on different platforms including Yelp, Womply, and Facebook.
  • Its services include in-house cleaning and maintenance service, custom experience, property inspection, scheduling of services, and advertising. The company offers its services in the entire Lake Tahoe and Truckee area.
  • Management fees are charged only when the home is rented as "there are no surcharges, up-charges, or hidden fees." The complete fee information is available through inquiry.

Tahoe Alpenglow Properties

  • This company was considered as one of the best because it is highly rated by users on different platforms including Yelp and Birdeye.
  • Its services include "state and local requirements, set-up, photos, marketing, screening, bookings, payments, tax, guest troubleshooting, inspections, damage insurance, housekeeping, and maintenance." Property management services are available in the Truckee area.
  • Fee information is available through inquiry.

Did this report spark your curiosity?