VALUE OF A PIER

WHAT IS A PIER ON LAKE TAHOE WORTH

by Jackie Ginley, Broker Associate

Listed by Trinkie Watson CA 00326518, NV S.001022

Lucky Bluff | offered at $41,000,000 Listed by Trinkie Watson CA 00326518, NV S.001022

Apier can add significantly to the value of a Tahoe Lakefront home, and that’s a number that’s likely to rise in the coming decade, as the odds of getting one become more and more slim.

After decades of legal and regulatory wrangling, a new rule took effect in 2019 limiting the number of piers that can be built at the Lake. This summer, for example, only 4 lucky lakefront owners will win the right to construct their own pier.

Applications were rolling in to the Tahoe Regional Planning Agency (TRPA) as this article went to print, but judging from past demand, we will likely see dozens of lakefront owners walk away disappointed this summer. (In 2019, 83 lakefront owners applied for the right to build a private pier, and only 5 were granted.)

Piers at Lake Tahoe were for many years unregulated. That’s why you see flat top boathouses, a throwback to the 1950s & ‘60s, and even rock crib piers that look like private marinas dotting the shoreline.

One 4-bedroom on the East Shore, for example, sold for almost $1,700/square foot last year, thanks in part, to the sprawling breakwater and lakefront amenities it offers.

You can’t build something like that today, and the value of that is obvious to those seeking Tahoe’s Lakefront lifestyle. Chase International Broker Mike Dunn has the home in contract again this year for more than what it closed for last year.

That property, like many lakefront sales, closed for cash last year. But a seller who accepts a financed offer for a lakefront home will be subject to an appraisal, and appraisers take an unemotional view of a property. Intangibles like the hand hewn beams that grace a property like Julia Morgan’s Bow Bay, or the rays of the setting sun from the end of a pier near Madden Creek on the Westshore, won’t necessarily boost the bottom line on an appraisal.

When it comes to an appraisal view on piers, “there’s just not one number you can assign to it,” said Trinkie Watson, a seasoned lakefront broker at Chase International. Appraisers will consider the slope of the lot and whether a pier is deep water or shallow. That also becomes important in drought

Crystal Pines | offered at $48,000,000 Listed by Shari Chase NV S.0016958

years, because a deep-water pier means you’ll be more likely to still be able to pull your boat up to onboard guests.

A shallow pier might add $500,000 to the value of a lakefront home, and a deep-water would add more, she said. Throw in a lift with buoys, and the value of the lakefront home might appraise for $1.5 million more than a pier-less neighboring home.

That was also reflected in the market last year for areas of the North Shore, where one home with an extensive pier and flat-top boathouse sold for $9.5 million, despite the fact that the home itself was small and somewhat dated.

Compare that to a beautiful North Shore home that closed for a little over $7.6 million, almost 5 percent under asking in an otherwise hot market. It had 5 bedrooms and more than 4,800 square feet of contemporary living space with a gorgeous lakefront grounds. But what it lacked was a pier.

And getting a pier these days is not so simple as just applying for one. From now until 2033, only 13 lucky homeowners will win the right to build a pier on their lakefront property. Some areas of the lake, such as stream mouths, will be entirely off limits, but for those with eligible properties, the application process involves submitting a fairly complex application that includes scenic and other mitigation.

If all that looks good, one is then thrown into a lottery where only four winners will get the right to build a private pier this year. Applications are open only every other year through 2033. In 2023, for example, only one private pier permit will be awarded.

Piers serving multiple parcels will be a little easier to secure; eight of those will be granted this year, nine in the application round two years from now, and 11 in the years moving forward. We’re likely to see some lakefront owners offering to share a pier with their neighbor, or buy their neighbor’s rights, which allows them to come forward with a “multiple parcel” pier application.

How we got to this place is a history lesson infused with regulatory action to protect lake clarity and lawsuits. The construction of piers, dating back to the era that preceded the pile driver, was a Wild West of building for much of the 20th Century.

Then TRPA stepped in. In October 2008, the agency approved a plan that would allow up to 128 private piers, lifting a moratorium on new pier construction that had been in effect for almost two decades. Two environmental groups sued, and the judicial opinion in that lawsuit laid the foundation for the plan we are living with today, which will allow for 71 more multiple parcel and only 13 private piers through 2033.

So what will be the future value of a pier at Lake Tahoe? Potentially … priceless.

For more information on Lakefront homes or the broader Lake Tahoe market, you can call Jackie at 775.391.9443 or email her at jackie@ tahoeishome.com.

Cedarbrook | offered at $11,999,000 Listed by Mike Dunn NV BS.0144453, CA 1916007

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