Blog :: 2017

2017 Q2 Martha's Vineyard Real Estate Market Summary

Happy summer from Martha’s Vineyard, it finally arrived!  It has been a busy start to the summer season, and in reality a strong carry-forward from the hectic early part of the year.  So, without much ado, please allow us to share our mid-year market commentary concerning the sales activity on-Island thus far.

The continued positive sentiment toward Martha’s Vineyard real estate has been demonstrated with the consistent number of transactions being consummated.  The search activity performed by prospective buyers has seen a vast improvement over that of last year.  And both median and average residential sales prices have significantly increased year over year despite there still being an above average level of inventory on a historic basis.

Transaction volume is increasing too, which is customary given the seasonality influence.  And while prices have increased, some segments are proving to be “hotter” than others.  Overall improved buyer sentiment and a greater sense of urgency to engage in the acquisition of property is readily present; therefore, competition has increased among prospective buyers.  It is still the better priced, better conditioned, and more idyllic properties that are generating the most interest and now often garner multiple offers.  But this dynamic has begun to spread across all market segments.

All told, Martha’s Vineyard still offers opportunity and greater relative value in comparison to many other like-kind markets, but choice of inventory and attractive financing options is becoming less available to those who wait given the volume of inventory recently consumed within various market segments, and the influence that the Federal Reserve has begun to place upon mortgage lenders through their policy actions.

Here are the more meaningful statistics to consider from the activity realized during the Second Quarter of 2017:

  • Inventory has increased with the accompanying warmer temps from the early spring total of 517 units to the current 543.  The total value of listed real estate on-Island now equates to $1.208B.
  • Thus far in 2017, a total of 203 residential properties were sold among the Island towns, which is 8.5% more than last years’ sales for the period:   Edgartown-57, Oak Bluffs-59, Vineyard Haven-38, West Tisbury-29, Chilmark-16, and Aquinnah-3

(Data Courtsey of LINK)

Year-to-date median residential sale prices on-Island have increased 10.2% from $672,000 to $740,000, while average residential sale prices increased by almost 22% from $1,015,000 to $1,232,000 as compared to the same period in 2016.  

Year-to-date residential sales in the aggregate have captured 96% of their final asking prices, and garnered approximately 125% of their respective tax assessments.  The strength of this correlation remains subject to factors such as competition, condition, amenity, and uniqueness of the subject properties sold, yet the relationship has been maintained over the past several years with relative consistency.

As an independent franchise that is associated with a national brand, we are often introduced to proprietary market analysis.  Resort-vacation-destination markets like Martha’s Vineyard have continued to enjoy consistent attention and acquisition; however they too are now encountering inventory driven issues much like the primary markets have endured.  However the decision drivers differ when electing to acquire a second, vacation type home as it is often a discretionary purchase.  

Nonetheless, there are similar economic, emotional, logistic, and utilitarian variables that are employed in the undertaking of such a venture.  And our agents are skilled and savvy in addressing them.  Please feel free to contact us with your questions and curiosities concerning properties of interest, or Martha’s Vineyard real estate in general. 

Lastly, if you are still seeking a summer vacation on-island, please be in touch with us for assistance.  There is still some availability and our rental agents are here to help you find a last minute getaway!

2017 Q1 Martha's Vineyard Real Estate Market Summary

Happy Spring to one and all.  Now that the First Quarter of 2017 has closed, let’s examine the real estate activity on-Island thus far and allow us to offer our comments for your consideration.

Aside from a couple of ‘normal’ snow events, the winter was relatively mild, but also has held on for longer than most would’ve liked.  However, since the holidays, our weekends have been bustling with early season real estate activities.  This confirms for us that the positive sentiment realized from the fall toward vacation/second home acquisition still abounds.  And given the calendar, with the arrival of the traditional spring market, we anticipate having more busy weekends in the field with prospective buyers pursuing acquisition activities toward finding an Island property before summer.

Continuing with the strong market dynamics of last year, many of the same variables we espoused during the past three seasons continue to exist here in early 2017, but perhaps with a greater sense of urgency or significance.  For several years now, the Vineyard market has meandered along in a “not too hot, not too cold” type behavior regarding the annual volume and realized prices of sold properties.  However, while attractive mortgage options are still available, they are becoming more sensitive to interest rate increases. And as the inventory increases from the off-season lows, the amount of new units may be tapered in number given the voluminous turnover we’ve already experienced during the past several years from this finite market of properties.

The median price on-Island has established the “sweet spot” for sales transactions during the first quarter.  By far, this is the most active segment of the market and therefore has depleted much of the available inventory.  And while the higher price segments offer many options within each of the Island towns, pricing is critical even in an active market.  “Blue-sky” pricing of a decade ago is not proving to be as effective a strategy in attracting buyers given our current market condition.  (Quarterly statistics courtesy of LINK)

The National Association of Realtors (NAR) reported that existing nationwide sales in 2016 were the best in a decade but that current housing inventory is the lowest in the country since 1999.  Their chief economist, Lawrence Yun, suggested that the expanding pool of buyers nationwide amidst a dwindling number of available properties has led to a tighter supply and therefore increased sale prices, but buyers are demonstrating caution in chasing properties for fear of over-paying, a lingering stigma from 2005.  With the spring market now upon us, it remains to be seen if the Vineyard will feel similar correlating effects after the strong transaction volume we conveyed in 2016.  But for prospective buyers of the island, it is important to recognize that the Vineyard has begun to “normalize” and emulate many of these same competing characteristics found off-island.  With high interest and increased demand for Island real estate but lower levels of available inventory to consume, buyers should expect to see higher market prices this year.

Here are the more meaningful statistics to consider from the activity realized during the First Quarter of 2017:

Current inventory for the first time in years is below winter holiday levels, which is often the most quite period of the year. Last year at this time, there were 475 total listed units.  As of this writing, there are 451.  As aforementioned, there likely will be an influx of listings forthcoming to participate in the “spring market”, once the warmer weather firmly arrives.  But there is a marked change in the complexion, volume, and pricing of properties found within the segments of our marketplace.  Therefore, prospective buyers will need to remain vigilant this spring and keep their eyes peeled for new supply coming to market, and be equally prepared to act promptly.

A total of 89 residential properties were sold among the Island towns within the First Quarter this year, which is 10% more than were sold a year ago. Specifically, home sales were found as follows:  Edgartown-19, Oak Bluffs-30, Vineyard Haven-16, West Tisbury-14, Chilmark-9, and Aquinnah-1.  

Median sales prices on-Island for Q1 increased 11% from $683,729 to $759,000 compared to the same period in 2016, while average prices increased by 14% from $1.133M to $1.292M during the same period.  

On average, residential property sales thus far have captured 96% of their final asking prices and garnered 126% of their respective tax assessments.  However, the strength of this correlation remains highly subject to factors such as condition, amenity, scarcity and uniqueness of the subject properties sold.

As an independent franchise that is associated with a national brand, we are often introduced to proprietary market analysis and industry trends.  We’ve thus learned that resort-vacation-destination markets like Martha’s Vineyard have continued to enjoy consistent attention and acquisition, but also significant heightened competition for these desirable properties.  So for those who have vested themselves in the search for Island real estate, 2017 may again afford the opportunity to make the commitment toward acquiring an Island property. But preparation and timing are becoming important variables.   And for current home owners to consider, because the better conditioned and more realistically priced inventory has been consumed in 2016, this year could prove to be an opportune time to list and successfully sell your Island property given the steady demand.  Please contact us to discuss performing a market analysis and Broker Opinion of Value for your property.  With over 30 years of market experience, we are able to counsel our clients well.

Home Sellers: 6 Tips For Getting the Best Offer

Homes Seller Hand ShakeWe all know the effort that goes into preparing your home to be sold. In addition to the upkeep and maintenance, you need to work with an expert to make sure your home is priced properly. As your home begins to gain attention from buyers, it's important to know how to effectively evaluate each offer.

6 Ways to Secure the Best Offer:

1. Understand Your Options

When you receive an offer, you have three options: Accept it, reject it, or make a counter offer.

2. Set Priorities

What is most important to you? If you are trying to get your home sold quickly, you will need to be flexible on the price, and vice versa.

3. Establish a Process

Set a time frame for which buyers must submit offers. That way, you'll have time to market your home to as many potential buyers as possible and you'll have time to review each offer.

4. Remember, it's business.

Don't take offers too personally; at the end of the day this is a business transaction. If a potential buyer is turned off by an aspect of your home, look for opportunity to negotiate or simply move on.

5. Closely Review Each Offer

While you may receive several similar offers, there are bound to be subtle differences in the terms of each. Make sure have a complete understanding of the terms of each.

6. Adapt

While it is important not to lose sight of your selling goals, there might be ways compromise to meet buyers' specific needs and close the deal. This is the process of negotiating.

This is a recap of an article by G.M. Filisko that originally appeared on HouseLogic.com.

 

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.