South Lake Tahoe has been experiencing a significant increase in Foreclosure and Short sales over the past year.  In the fall of 2007, financially distressed properties accounted for less than 10% of total Single family home sales.  The percentage of financially distressed sales increased to 24% in October, 2008 and 35% in November 2008.

The percentages are significantly higher when Tahoe Keys and New Construction sales are removed.  Twenty Nine percent were financially distressed in October, 2008 increasing to Forty Six percent in November, 2008.  Tahoe Keys is a waterfront community located in South Lake Tahoe with most homes featuring boat docks in their back yards and access to the lake via canals.  Prices in Tahoe Keys are significantly higher than the majority of homes located in non-waterfront areas.  New Construction accounts for a very small percentage of sales since most of the vacant lots in Tahoe have been developed.  Local building restrictions limit new development.