Housing in South Lake Tahoe: Affordable housing projects and a look at inventory

SOUTH LAKE TAHOE, Calif. - In an examination of housing in South Lake Tahoe, one needs to look at many moving parts from regulations to land availability to affordability. In the second in a series, we will be looking at affordable housing projects in the city, those that have been completed, in the works, and planned.

People struggle both to find a place to live as well as paying for it, not only in South Lake Tahoe but across the country. Millions struggle monthly just to pay rent.

The definition of affordable housing: Housing on which the occupant is paying no more than 30 percent of their gross income for housing costs, including utilities.

If a person makes $20 per hour, their full-time gross monthly income is $3,467. Their affordability rate would be $1,040 for housing and utilities, per definition. If a two-income household, that amount would be double.

As most renters know in South Lake Tahoe, there are few places to live that meet the 30 percent rule.

The South Lake Tahoe Housing Element report shows typical rents in South Lake Tahoe have been increasing. The seasonal nature of the Lake Tahoe workforce leads to a considerable turnover of housing units in the city. With the frequent turnover in units, landlords are able to raise rents more easily and more often than if the residents stayed for longer periods. This pattern of “unit hopping,” combined with the lack of new rental unit development, has allowed the cost of rental housing to increase much faster than local workers’ incomes.

In South Lake Tahoe, per the Housing Element statistics in 2019, there were 9,954 single-family homes in South Lake Tahoe along with 5,314 multi-family units and 563 mobile homes. Forty-one percent of homes are owner-occupied, and 59 percent are renter occupied. Lake Tahoe has always had a large number of second homeowners, and current figures show 49.9 percent of South Lake Tahoe's housing stock is seasonal or used occasionally and not full-time rentals or full-time owner-occupied.

The vacancy rate is an important factor in the availability of housing. Where vacancy rates are high, housing prices and rents tend to be lower. A vacancy rate of 5 percent or lower for rental housing and 2 percent or lower for ownership housing indicates a “tight housing market,” meaning that it is harder to find available units in any particular area or price range. In 2019 when the last survey was completed, the South Lake Tahoe homeowner vacancy rate was 2.4 percent, with a rental vacancy rate of 7.3 percent.

An extremely low-income family of four can afford to spend a maximum of $680 for monthly rent and utilities. The average rent for a three-bedroom apartment or house in South Lake Tahoe is $3,800, over five times the affordable price limit for an extremely low-income family.

The City of South Lake Tahoe has coordinated and partnered on 344 existing units of affordable housing at eight properties, with the biggest project of its kind in the Lake Tahoe Basin, Sugar Pine Village, with first phase coming in 2024 - a total of 248 units when completed.

The City has assisted in the development of the following housing projects:

The Aspens at South Lake Tahoe – 47 units of family affordable housing for low- and very low-income households
Evergreen Apartments – 26 units of family affordable housing for low- and very low-income households
Kelly Ridge - 32 units of affordable senior housing for very low-income persons 62 years and older
Sierra Garden Apartments – 75 units of family affordable housing for low- and very low-income persons
Sky Forest Acres – 18-unit housing project for very low-income persons with disabilities
Tahoe Pines Apartments - 28 units of family affordable housing for low- and very low-income persons
Tahoe Senior Plaza – 44 units of senior housing for very low-income persons 62 years and older
Tahoe Valley Townhomes – 70 units of family housing for low- and very low-income persons

The City provided the land for three homes being built by the St. Joseph's Land Trust in the Al Tahoe Neighborhood. To keep them more affordable for qualifying families to purchase, the land trust owns the land so they will remain in workforce housing even when the properties sell.

One interesting note, since 2010, the City of South Lake Tahoe has 809 fewer residents with 530 fewer households but has more housing units with 15,831 now compared to 14,050 in 2010 (based on the recently completed Housing Element report).

Sugar Pine Village

The first phase of Sugar Pine Village on Lake Tahoe Blvd. and Tata Lane will provide 68 one, two- and three-bedroom units of 100 percent affordable housing built along with the required infrastructure and landscaping. The first phase is being built in modules in the Sacramento Valley and it will take 87 truckloads to bring it to the site for assembly. This first phase also includes 100+ parking spaces and play areas for children. Phase 1’s income eligibility will be for households in the range of 30-60 percent of the Area Media Income (AMI). The income requirements will be at the time of renting, but at this time those earning approximately $26,100 - $52,200 annually would qualify.

This first phase will go vertical this summer and work will continue with leasing by September 2024. The second phase will have 60 of the one, two- and three-bedroom units and will phases three and four.

Existing Housing Stock

Not only is there an affordable housing project underway, but there is also a lot of work going on in the housing world including improving the current housing stock.

Bart's Tahoe Apartments had several safety code violations, and the City worked with the owner to get them corrected. Now the new owner is renting them out.

It is up to property owners, not up to the City for rehabilitating housing according to the City's Housing Manager Zach Thomas. He said they can take significant effort and money just to get them to meet health and safety codes.

"Housing isn't always about new units," said Thomas. "It's keeping current stock inhabitable, safe, and available."

An apartment house on Spruce Avenue was closed by the City in December 2018 due to unsafe living conditions. The building has since been sold and the City has active demolition and full remodel permits for the property. The City also conducted electrical and plumbing inspections as recently as December 2022.

The Sunray Motel provided weekly rentals to many lower-income residents, but it was shut down to numerous code violations in March 2022. Nothing has been corrected at this time so the owner continues to have fines levied against him. It has been said it is in escrow, but future plans are unknown. It had 72 rooms available at one time.

The City teamed up with Landing Locals that matched vacant vacation homes with locals in need of housing. So far, 25 homes have been opened up with this program, giving housing to 59 individuals. The homeowners can earn up to $10,000 for renting their vacant homes.

Next up on our housing series: The City's Strategic Planning goals for local housing. Is rent control a possibility? What are housing constraints with sensitive lands and building regulations?