David Federowicz

Martha's Vineyard Real Estate 2016 Year-End Commentary

COLDWELL BANKER LANDMARKS
PREVIEWS INTERNATIONAL

2016 Year-end Market Commentary

By Sean D. Federowicz, M.B.A.
Broker, Owner, Realtor

The significant cadre of prospective buyers who had been biding their time since the market height in 2006, having endured the “great recession” and the subsequent market recovery of 2015 on-Island, have become more aware of the nuances associated with Island ownership. Many of these parties re-entered the market during the past two seasons to make their purchases. Yet seemingly, there is a balance of prospective buyers who are still on the sidelines, waiting for the “perfect property” or “perfect time” to commit.

The irony here is that these very same folks may risk missing out (again) on an attractive buying opportunity as the Vineyard market continues to demonstrate improved strength.  With higher lending rates now expected, and if the weather cooperates, we anticipate the New Year getting off to an early and strong start before the customary, albeit competitive “spring market” arrives. Here are some facts, observations, and opinions that may help you formulate your own point of view regarding the state of Martha’s Vineyard real estate.

Here are some facts, observations, and opinions that may help you formulate your own point of view regarding the state of Martha’s Vineyard real estate.

  • Nationwide sentiment toward real estate has substantively improved, especially among second home seekers in vacation/destination markets like Martha’s Vineyard, as investments made within these segments are for both lifestyle and financial purposes.
  • Reinforcing the good feeling is the continued and relatively favorable interest rate climate. However, the near-term trajectory of lending rates appears to be heading upward with the recent policy actions from the Federal Reserve Bank.
  • The S&P, Core-Logic, Case Shiller Indices expect home prices to improve another 5.2% in 2017, likely as a result of existing tight inventory conditions.  But the sentiment stemming from this primary market dynamic will likely affect Island real estate pricing too, even if nominally.
  • The 4th Quarter realized a significant volume of residential sales on-Island (155) exceeding Q1 (88), Q2 (99) and Q3 (114).  Our “Fall Market” has become stronger than the customary “Spring Market”.  Note that the total number of properties for sale has decreased significantly from the seasonal high of approximately 637 in late August to 475 at this writing.  Arguably, the Vineyard market still has excess inventory.  But with the supply of “quality” units falling, prices can more readily increase. This could also be a cue for potential sellers to enter the market with new listings come spring, if not sooner.  Please contact us to discuss the salability of your property.
  • In 2016, residential sales on-Island were again realized from all price segments totaling 456 units versus the 462 transacted in 2015.  However, comparative to 2015, the high-end segment participated to a lesser extent this year. As a result, price divergence has now developed between median and average sales prices, whereby the former increased by 11.2% from $650,000 to $723,000 but the later decreased 8.7% from $1,259,000 to $1,149,000.
  • Sales prices on-Island continue to capture approximately 95% of their asking price, but garnered 129.40% of their respective tax assessment.  This break in correlation between assessed value and sales price has continued from the end of 2012 and confirms that a return to “normalcy” is well underway on Martha’s Vineyard.
  • For the year, Island towns conveyed the following number of residential properties; Edgartown-141, Oak Bluffs-118, Vineyard Haven-95, West Tisbury-55, Chilmark-39, and Aquinnah-8.
  • The Island is a finite commodity having both geographic and economic barriers of entry that promote various price supports not typically found in many primary real estate markets. Although scarcity, location, condition and amenities continue to be key drivers toward pricing.
  • As desirable inventory is pared down, prices will continue to adjust upward as a function of supply and demand.  It is not surprising that with the improved market climate, the better priced, better conditioned properties are going under contract more quickly than their respective competition.
  • Our successful 2016 clients, buyers and sellers alike, have these best practices in common: Identify your wants and needs, learn the market, develop reasonable expectations, perform your due diligence, and “be prepared to act”.  This micro-market has returned to a more competitive and urgent dynamic.

It is our expectation for 2017, that Martha’s Vineyard will catch up to the competitive trends found within many primary markets. We expect the increase in search activity to continue, especially from those who have long watched from the sidelines and may now fear “missing out” on capturing their dream of Island ownership or having to endure higher finance costs to do so.

As the economy continues to stabilize, the absorption rate for Island property will also continue to increase, resulting in sales price increases as supply decreases.  Lastly, with mortgage interest rates now rising, this factor may also provide some incentive for prospective buyers to act sooner rather than later.  This will add to the increased competitive dynamic for real estate acquisition on-Island.

Certainly anything can happen during the year, of course, and the Island’s resilience as a discretionary market of desire will be tested.  However, for those individuals who perform their due diligence, work with an experienced Realtor, and are ready to take action, it still remains a great time to be a Buyer of Martha’s Vineyard real estate!

If a purchase of an Island property is not in your future right now, there is still time to book your 2017 summer vacation rental.  Our inventory features homes that accommodate most every need and represent every corner of the Island.  But availability for best properties and weeks is waning.

As always, do not hesitate to contact us with your questions concerning properties of interest, and Martha’s Vineyard real estate concerns in general.

Martha's Vineyard Third Quarter Real Estate Sales Commentary

COLDWELL BANKER LANDMARKS
PREVIEWS INTERNATIONAL

Third Quarter Sales Commentary
By
Sean D. Federowicz, M.B.A.
Broker, Owner, Realtor

It is hard to believe that another season is now in the books, and we are again reminiscing over what was a near perfect summer on Martha’s Vineyard.  The weather was idyllic, and the usual seasonal events delivered plenty of enjoyment to its patrons. The ferries and beaches were non-stop full, and the real estate market on-Island continued a positive, albeit more modest trajectory from 2015. The typical springtime real estate search activities began haphazardly but gained steam as we migrated into summer. And we have been been actively in the field with clients ever since with the expectation that a productive fall market is unfolding before us.

Despite the continued geo-political and macro-economic issues in the world today, prudent investment decisions and lifestyle choices remain overriding considerations among buyers of Martha’s Vineyard real estate.   With relative value, choice, and compelling lending rates still available, we are anticipating continued search and acquisition activity through year-end before the holidays and quieter winter months arrive.

The confluence of events that has enabled Martha’s Vineyard to retain market traction this season still has room to run before emulating the conditions found among many primary markets, which is arguably a supply driven issue focused upon the limited availability of quality properties for sale. That is not the condition on-Island.  However, the general local market dynamic and sentiment has notably improved with more interest and greater activity from buyers and sellers alike.

After closing a robust and markedly intense 2015 season, and given the continued degree of activity that we have experienced year to date and year-over-year, we expect our micro-market to continue “normalizing” and follow both the region’s primary and other second home market trends.

Please consider the following;

  • Year to date 301 residential properties have sold on Martha’s Vineyard, which is down 5.3% from the 318 sold for the same period in 2015.
  • Q3 alone conveyed 106 residential properties, down modestly by 15.0% from the 124 sold in 2015 for the same period.
  • The number of properties for sale however, has remained relatively constant for nearly seven years.  There are currently 637 total active listings representing $1.441B of listed real estate on-Island.
  • At the Quarter’s close, year-over-year median home sale prices increased 10.0% from $690,500 to $756,125, but average home sales prices decreased by 14.0% from $1,337,104 to $1,156,539 for the period.  These metrics speak to the change in price segment participation this season from last year, reflecting the properties sold.
  • On average, YTD home sales on-Island have transacted at approximately 95% of their asking price while realizing 125% of their tax assessment.  This correlation suggests that property sale prices exceeding the respective tax assessment have continued to trend more broadly throughout our micro-market, but still remain subject to the attributes of condition, location, utility, scarcity and uniqueness.

Acquiring real estate in this largely second-home market is often a discretionary decision.  However, given the consistently high level of inventory coupled with continued low interest rates, this arguably remains one of the most attractive times to acquire an Island property for both financial and emotional returns.  There will come a time, and likely now sooner than later, when this degree of opportunity will become out of reach for some.  But Martha’s Vineyard, compared to many like markets, continues to afford an attractive opportunity for those willing to make a commitment to her.

Please visit www.mvlandmarks.com to view a comprehensive list of all available Island listings.  If you would enjoy having immediate and free, real-time access to our ever-evolving inventory of listings, please contact us to receive access into LINK, the Island’s local MLS.  And as always, do not hesitate to contact us with your questions and curiosities concerning those properties of interest and Martha’s Vineyard real estate topics in general.

If, however, a purchase of Island property is not in your future right now, this is an opportune time to book your summer vacation rental for 2017.  Our Island-wide inventory features homes that accommodate most every need, but competition for the best properties and available weeks has markedly increased.  Our experienced rental agents are readily available to assist you in finding the perfect vacation home.  Please do not delay, contact us now to assist you with creating your dream vacation!

 

5 Reasons to Visit Martha's Vineyard in the Fall

Martha's Vineyard Fall

Foliage

Other parts of New England may be more known for their beautiful foliage, but Martha’s Vineyard foliage is spectacular if you know where to go! Places to find the best colors on the island are those areas that are wet and have blueberries and huckleberries. The Land Bank’s Sweetened Water Preserve on Edgartown-West Tisbury Road in Edgartown has easily viewed from a passing car foliage that won’t disappoint. This area is also home to water willows, which are known for turning a deep, cranberry red. Passing motorists on County Road in West Tisbury will also be able to see the sumac trees which are also known for turning a deep red. The most distinctive fall foliage may lie on the great outwash plains of the south shore. Looking to get a little closer to the changing colors? Quansoo Farm, Sepiessa Point Reservation, and Long Point Reservation, all located in West Tisbury, offer public trails that have beautiful panoramic views of the sea and foliage.

Hiking

No matter what time of year you are visiting the island, be sure to check out some of the amazing hiking trails scattered across Martha’s Vineyard. Some popular hikes include Great Rock Bight off of North Road in Chilmark. The moderately easy hikes wind through woods to a bluff overlooking Vineyard Sound. Dog-friendly, and leading to a beach only accessible by foot, this is a great way to spend a sunny afternoon. If you’re looking to get a little closer to the wildlife of the island, Long Point Wildlife Refuge is a great place to start. The refuge offers miles of hiking trails and plenty of vegetation and vistas. More information on hiking trails and locations can be found here.

Food

Martha’s Vineyard has always been steeped in the tradition of farming and fishing. One thing you can’t miss this fall on the Island is the annual Martha’s Vineyard Food & Wine Festival. MVF&W is a four-day, four-night experience that any foodie, or hungry traveler, won’t be disappointed about. Located throughout Edgartown the festival consists of 22 events. A portion of the proceeds goes to benefit the island’s farm-to-school program Island Grown Schools. Tickets can be purchased on the festival’s website.

Culture

Martha’s Vineyard offers an amazing art scene year round. Fall is home to the Vineyard Artisan’s Annual Columbus Day Festival. This free festival located in West Tisbury is a fun for the whole family. Catch local artisans of all disciplines!

Skip The Crowds

One of the best parts of visiting the island in the off-season is that there are fewer people, which means fewer cars, and a shorter commute to any part of the island. This gives you an opportunity to really enjoy the beautiful scenery the island has to offer without all the chaos of clogged roads and insanely busy restaurants.

 

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