NEW ENGLAND — CAPE COD & THE ISLANDS
This month, we’re taking a closer look at the second home market spanning Cape Cod, Nantucket, and Martha’s Vineyard. With demand at record highs in a widely non-leveraged seller community, pricing remains strong despite broader economic conditions.
After an initial slow-down during the early weeks of uncertainty surrounding COVID-19, demand in the Cape and Islands has come roaring back, outpacing recent years’ activity in some cases. As summer approaches and urban buyers are increasingly eager to escape the city, low inventory – down 20% YoY – continues to drive tight pricing in the luxury market. “From a transaction standpoint, our biggest hurdle is a gap in perception vs. reality with regards to value,” says Chris Rhinesmith, co-owner of Chatham-based Pine Acres Realty. “Buyers are coming in expecting a discount, but in an inventory-constrained market where sellers are under no pressure to sell, that’s just not the case.”
Luxury properties are trading within 5% of asking price on average, with some buyers securing their summer getaways with aggressively high offers. “We just closed a deal at $200K over asking on a $2M house in a non-bidding war situation,” says Rhinesmith, “That doesn’t even happen under good economic conditions.”
The key to uncovering inventory? The right price. Opportunity exists for buyers willing to make irresistible offers off-market, though even this doorway to Massachusetts’ beaches may be closing. As would-be sellers settle in to enjoy another summer season, Rhinesmith expects the low-supply trend to continue, anticipating a surge of new properties in early fall.
