Blog :: 2018

Martha's Vineyard Real Estate: 2018 Q2 Market Commentary

Happy summer from Martha’s Vineyard!  It has been another busy start to the summer season, and thus far the weather has been idyllic. Please allow us to share our mid-year market commentary with you concerning the sales activity on-Island thus far. 

The continued positive sentiment toward Martha’s Vineyard real estate has been demonstrated with a consistent number of transactions being consummated. And search activity performed by prospective buyers has remained consistent over the past year too.

However, while selling prices have recently plateaued, some segments are proving to be “hotter” than others. With improved buyer sentiment coupled with a greater sense of urgency to engage in the acquisition of property, competition continues to exist among prospective buyers for coveted listings or the most desirable areas. It is still the better priced, better conditioned, and more desirable properties that are generating the most interest and often garner multiple offers.

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 are becoming less available to those who wait given the volume of inventory recently consumed, and the influence that the Federal Reserve has placed upon mortgage lenders through their policy actions.

Martha's Vineyard

Here are the more meaningful statistics to consider through Second Quarter 2018: 

Inventory has increased with the accompanying warmer temps from the early spring total of 406 units to the current 558. The total value of listed real estate on-Island now equates to $1.341B.

Thus far in 2018, a total of 205 residential properties were sold among the Island towns, which is down 6% from last years’ sales of 217 for the same period:  Edgartown-60, Oak Bluffs-66, Vineyard Haven-37, West Tisbury-19, Chilmark-12, and Aquinnah-0. 

Second Quarter sales statistics courtesy of LINK

Martha's Vineyard Q2 2018 Real Estate Statistics

Martha's Vineyard Q2 2018 Real Estate Statistics

Martha's Vineyard Q2 2018 Real Estate Sales by Town Martha's Vineyard Q2 2018 Real Estate Dollar Volume by Town 

Year-to-date median residential sale prices on-Island have decreased 2% from $740,000 to $725,000, while average residential sale prices also have decreased 7.1% from $1,234,000 to $1,145,000 as compared to the same period in 2017.

Year-to-date residential sales in the aggregate have captured nearly 97% of their final asking prices and garnered approximately 126% 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.

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. And while the decision-making drivers differ when electing to acquire a vacation type home, there are similar economic, emotional, logistic, and utilitarian variables that are employed in the undertaking of such a venture. Our agents are skilled and savvy in helping you identify and address them. 

Please feel free to contact us with your questions and curiosities concerning properties of interest, or Martha’s Vineyard real estate in general.  And please do regularly re-visit www.mvlandmarks.com to help keep abreast of all Island properties for sale. 

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!

Martha's Vineyard Real Estate: 2018 Q1 Market Commentary

Happy Spring (finally) to one and all. The First Quarter of 2018 has closed, so let’s examine the real estate activity on-Island thus far and allow us to offer some comments for your consideration. 

Since the holidays, the early winter weather was relatively mild and contributed to some quick, successful transactions. But more recently, Mother Nature has delivered several late season storms that have significantly impeded the normal and customary real estate activities on-Island.

Despite the carry forward in positive buyer interest from the fall, if it wasn't the weather, it has been the disruption in ferry service provided by the Steamship Authority that has contributed to the slow start to the season. Prospective buyers simply have had too much anxiety toward making any early season due diligence trips for fear of getting stuck on one side of Vineyard Sound or the other.

However, now that ferry service ills are resolved, and warmer temperatures are surely closer at hand, the positive sentiment realized from the fall toward vacation/second home acquisition will resume more comfortably. And given the maturing spring calendar, we anticipate having more busy weekends ahead, being in the field with prospective buyers pursuing investigative activities toward finding an Island property before summer arrives.

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 2018, but perhaps with a greater sense of urgency. 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 Island inventory increases from the off-season lows, the amount of new units are likely to be tapered in number given the voluminous turnover we’ve already experienced during the past several years from this finite market of properties.

Martha's Vineyard

Much as the closing months of 2017 demonstrated, the median price on-Island has established a "sweet-spot" for sales transactions during the first quarter, which has fallen within the $500,000-$900,000 price range. By far, this is the most active segment of the market and therefore continues to deplete much of the available inventory. And while the higher price segments offer many options within each of the Island towns, pricing remains critical, even in an active market. "Blue-sky" pricing of a decade ago is not proving to be as effective a strategy to attract buyers given our competitive market condition.

The National Association of Realtors (NAR) reported that existing nationwide sales have continued in an upward trajectory, albeit with tapered enthusiasm, as available housing inventory is contracting. 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. With another spring market now upon us, it remains to be seen if the Vineyard will feel similar correlating effects after the strong transaction volume we have conveyed consistently since 2015.

But for prospective buyers of the Island, it is important to recognize that the Vineyard continues 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, prospective buyers should expect to see higher market prices through the balance of this year.

For consecutive years now, current inventory is below winter holiday levels, which is often the most quiet period of the year. Last year at this time, there were 451 total listed units. As of this writing, there are 406. 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 various segments of our micro-market. 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.

For your consideration, here are the more meaningful statistics from activity realized during the First Quarter of 2018.

Quarterly statistics courtesy of LINK

Martha's Vineyard Real Estate Q118

Martha's Vineyard Real Estate # of Sales by Town Q118Martha's Vineyard Real Estate Total Dollar Volume by Town Q118

A total of 88 residential properties were sold among the Island towns within the First Quarter this year, which is one less than was sold a year ago for the same period.

Residential sales by Town:

Edgartown-26, Oak Bluffs-28, Vineyard Haven-16, West Tisbury-10, Chilmark-8, and Aquinnah-0.

Median sale prices on-Island for Q1 decreased approximately 2% from $759,000 to $745,000 compared to the same period in 2017, and average sale prices decreased by approximately 14% from $1.292M to $1.106M for the period.

On average, residential property sales captured 96.5% of their final asking prices and garnered 118% 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 independently owned 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, 2018 may again afford the opportunity to make the commitment toward acquiring an Island property. But preparation, education 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 2017, this year could prove to be an opportune time to list and successfully sell your Island property given the present steady demand. Please contact us to discuss performing a market analysis and Broker Opinion of Value of your property. With over 30 years of market experience, we are able to counsel our clients well.

If a purchase of an Island property is not in your future right now, there is still time to book your 2018 summer vacation rental. Our inventory continues to grow featuring homes that accommodate most every need and represent every corner of the Island. But availability for best properties and weeks are waning. Please contact us to assist you in creating your dream vacation!

Please visit www.mvlandmarks.com to view a comprehensive list of all available Island listings for sale or vacation rental. And as always, please do not hesitate to contact us with your questions and curiosities concerning properties of interest or Martha’s Vineyard real estate in general.

Summer is coming to the Vineyard, might YOU be coming to your Island home??? 

2017 Year-end Martha's Vineyard Real Estate Market Commentary

Greetings and a happy belated New Year to one and all! As has become customary, we offer our annual installment of “The Year in Review” concerning Martha’s Vineyard Real Estate activities.

It appears that 2015 was the watershed year for the real estate recovery to finally take hold on-Island. It has been a long many years of meandering since the depths of the real estate recession in 2009 for Martha’s Vineyard real estate. The confluence of events, specifically positive sentiment, heightened levels of quality, well-priced inventory and attractive financing options combined toward making 2015 a very strong year for sales, and have continued to carry forward into 2016 and 2017 respectively.

Despite the fairly pedestrian “spring market” and seasonal weather to start last season, Mother Nature did provide us with another terrific summer for all concerned. Let’s hope for another mild weather pattern in early 2018 to help parlay the robust real estate activities of fall into the New Year!

The significant cadre of prospective buyers who have been biding their time since the market height in 2006, then endured the “great recession” and subsequent market recovery, have become more aware of the nuances associated with Island ownership. Many parties re-entered the market during the past three seasons to make their purchases, which has effectively contributed to an inventory supply issue on-island that reflects what is being experienced in many primary markets. With higher lending rates now expected, and demand beginning to outpace supply, we anticipate the New Year getting off to an early and strong start before the customary “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.

  • 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.
  • The recent tax law has modified the mortgage interest deduction for primary loans, reducing the eligible amount from $1M to $750,000. While not viewed as a significant variable for many second-home buyers, it is an aspect worth discussing with your financial counsel during the consideration of purchasing an Island home.
  • Freddie & Fannie Loan limits have been increased specifically for the Cape Cod & Islands region. The ‘mezzanine’ level found above the conventional limit of $417,000 now extends to $679,650 before Jumbo portfolio product is required for lending need.
  • 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 continued policy tact from the Federal Reserve Bank.
  • The S&P, Core-Logic, and Case Shiller Indices report that U.S. homes prices increased nearly 7% in 2017 and expect them to increase comparably in 2018, the result of existing tight inventory conditions. Therefore, the sentiment stemming from this primary market dynamic will likely affect Island real estate pricing too as local inventory contracts.
  • The 4th Quarter realized a significant volume of residential sales on-Island (137) exceeding Q1 (97), Q2 (120) and Q3 (109). Interestingly, 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 566 in late August to 415 at this writing. Arguably, the Vineyard market still has excess inventory. With 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 2017, residential sales on-Island were realized from all price segments totaling 464 units versus the 456 transacted in 2016. Median and average sales prices both increased year-over-year, whereby the former increased by 8.7% from $723,000 to $785,000 and the later increased 10.6% from $1,149,000 to $1,271,000.
  • Sales prices on-Island continue to capture approximately 95% of their asking price, and have on average garnered 124.4% of their respective tax assessment.
  • For the year, Island towns conveyed the following number of single family homes; Edgartown-143, Oak Bluffs-101, Vineyard Haven-95, West Tisbury-52, Chilmark-38, and Aquinnah-9.
  • 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. 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 2017 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 2018, that Martha’s Vineyard will fully 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 further 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 2018 summer vacation rental. Our inventory continues to grow featuring homes that accommodate most every need and represent every corner of the Island. But availability for best properties and weeks are waning. Please contact us to assist you in creating your dream vacation!