Tahoe tourism propels Nevada hotels to near-record room revenue, surpassing pre-COVID highs
Nevada’s Lake Tahoe and Reno hotels generated near-record revenue last summer, according to new figures.
In June 2021, hotels in Washoe County, which lies on the east shore of Lake Tahoe, brought in $45.2 million in taxable room revenue, the Reno-Sparks Convention and Visitors Authority said. The figure surpasses pre-pandemic totals in 2017 and 2018, and falls second to August 2019 when tourism generated $46,663,912 in tax revenue.
Average daily rates in the region increased last summer, and in June 2021 they increased 21.8%, from $116.34 to $141.70, marking the highest ever recorded for a single month, the Reno-Sparks Convention and Visitors Authority said. Taxable rooms also increased 22% during the same time period.
“Seeing the destination thrive during a challenging time speaks volumes about where Reno Tahoe is headed,” said Reno Tahoe President and CEO Charles Harris in a news release. “The most significant indicator from June is the fact that we had more occupied rooms in Reno Tahoe than we did in June of 2019. With Hot August Nights in full swing and other great legacy events like the National Championship Air Races and the Best in the West Nugget Rib Cook-off still to come, we’re hopeful this momentum will continue throughout the summer.”
The increase in hotel revenue around the Lake Tahoe is to be expected as the region experienced a surge of visitors during the pandemic.
The jump in visitors has stressed some businesses, which are finding workers hard to find amid a skyrocketing housing market. While the surge in visitors has brought record revenue, some businesses on the California side of the lake struggled to find staff to stay open last summer with skyrocketing housing costs displacing workers.
Last summer, all California ZIP codes surrounding Lake Tahoe saw home values increase between 20% and 34%. In South Lake Tahoe, home values rose by about $181,000, or 41%, to $624,000 between June 2020 to June 2021, roughly double the pace of growth in the rest of the Sacramento metro area, according to Zillow.com.
The rise is housing costs accompanied a rise in tourism and short-term rentals. In Placer County, which covers the north and west side of the lake, county officials received an additional 400-500 applications for short-term rental permits. The county has a total of 2,500 active permits currently in use.
In many cases, locals reported to county officials that landlords were selling their rental properties to capitalize on a booming real estate market and cash-heavy buyers were purchasing the properties with the intent of converting the home to a short-term vacation rental, according to county meeting documents last year.
Restaurants and resorts that drive the region’s economy have scaled back services, the Bee reported in July 2021. The hospitality industry, which lost droves of workers during the pandemic, couldn’t find enough workers who can afford to live there.
Restaurants reduced their days of operation, closing on slow days mid-week. Some hotels reduced the number of rooms they rented out because they lacked the housekeeping staff. Most businesses along Tahoe City’s main thoroughfare, North Lake Boulevard, have “Help Wanted” signs hanging in windows, some promising season ski passes to prospective employees.