Greetings from Martha’s Vineyard!  Spring has arrived on the Island and summer is not far away.  Seasonal stores are re-opening, and the local landscapers and painters are scurrying about attending to properties as the Island awakens with eager anticipation for the return of the season and her patrons again!

The mild winter weather experienced across much of the south coast of New England coupled with higher mortgage rate risk and the exceedingly low level of inventory all contributed to some quick and successful transactions early this year to get ahead of the increased seasonal competition.  We practitioners customarily speculate during the early Spring how many units and from which market segments new inventory may materialize to help replenish local housing stock.  Our supply is woefully below the pre-Covid levels that offered 289 residential units in April of 2020!  This is not an unusual condition for only Martha’s Vineyard, as the entire country is suffering through an inventory deficit.  But the persistent demand has continued to outpace available supply on-Island, and thus has contributed to the sustained level of elevated prices.  This condition appears likely to continue for the foreseeable future, especially given the finite nature being an island that has few channels available to tap for inventory replenishment.

Much as the closing months of 2022 demonstrated, the First Quarter median and average sales prices were directly correlated with the characteristics found within the current limited inventory.  The continued increase in both asking and sales prices are a direct reflection of the significant scarcity in available property listings. And no market segment is insulated from this dynamic.

For your consideration, here are the meaningful and perhaps surprising statistics from activity realized during the First Quarter of 2023:

Last Spring, there were 114 total residential units listed for sale.  As of this writing, there are even fewer now available at just 88 in mid-April. As aforementioned, there likely will be some new listings forthcoming to take part in the “spring market”.  But the spring selling season has already begun and the activation of new listings for resale have been few thus far.

A total of 68 residential properties were sold among the Island towns within the First Quarter, which is 16% fewer than were sold a year ago for the same period at 81. Home sales were transacted across the Island as follows:  Edgartown-22, Oak Bluffs-15, Vineyard Haven-16, West Tisbury-10, Chilmark-3, and Aquinnah-2.

While total residential unit sales have continued to decrease on-Island, median sales prices for Q1 have increased 12% from $1.350M to $1.512M, with average prices also increasing another 9% from $2.115M to $2.309M during the same period in 2022.  Island-wide, average residential property sales have thus far captured 94% of their final asking prices and garnered on average 161% of their respective tax assessments. 

Several customers and clients of our agency have expressed some concern that we are in a “real estate bubble”, which is understandable given the recent realized appreciation.  However, the current market conditions do not at all resemble the poor health of the credit markets or the existence of toxic lending practices that contributed to the Great Recession of 2008-2009. Rather, the current market continues to suffer from the simple effects of low supply and high demand, which for a small, finite market like Martha’s Vineyard, will take longer to normalize than off-Island. Therefore, this aspect will allow prices to remain elevated but stable until more supply is contributed to the marketplace, and that simply will take time to resolve.

The cadre of buyers interested in acquiring property on Martha’s Vineyard remains significant.  And there are many prospective buyers who are willing and able, just eagerly waiting for an opportunity to present itself.  So being informed and prepared with all Offer documents being “trigger ready” for submission is critical within this competitive environment.  The better priced, well-conditioned properties are almost guaranteed to receive multiple bids within days of being listed for sale.  Many buyers are now waiving typical purchase contingencies, and some are employing escalator clauses.  Therefore, Offer strategies have dramatically changed and should be considered carefully.  Please contact one of our agents to help you navigate these changing waters in buying property on Martha’s Vineyard.

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