Happy summer from Martha’s Vineyard!  And welcome back to a greater sense of normalcy as Covid drifts farther into the collective rear view.  There is much to consider, so please allow us to share our mid-year market commentary concerning the sales activity on-Island thus far. 

The fervor that sparked real estate transactions during the last two years has moderated as a result of both higher lending rates and lower levels of available inventory. Like last year, the expected ‘spring market bounce’ from the activation of new inventory did not materialize and we began the spring selling season with a significant deficit in local stock.

It was suggested that due to some prospective sellers who used their Island properties as “Covid havens”, their absence would diminish, and they would opportunistically return their homes to market as sales prices were escalating as a result of the persistently high demand and low supply condition.  However, this thesis may not fully address the still constrained inventory condition on-Island.  In fact, the answer may lie more simplistically in the fact that this micro-market is finite, and that since we had averaged over 400 residential sales annually during the several years preceding Covid, and that most properties purchased are considered “legacy assets” and do not intend to be resold in the foreseeable future, there simply isn’t much supply now available for resale.

The housing market on-Island is mirroring the current supply and demand issues affecting the Nation’s general housing market. However, this condition will be more quickly resolved by many off-island markets than it will on Martha’s Vineyard for the simple reason that those communities have more land resources to develop and create housing supply than the Island has available.  The general take-away to consider is that the persistently low inventory condition coupled with consistent demand, will allow prices on-Island to remain elevated.  It is the supply variable that will change the complexion of this equation.  But that is not expected to fundamentally change in the foreseeable future with the limited channels of replenishment available locally. Buyer sentiment toward Martha’s Vineyard has been stable for some time, as reflected by the above average rates of consumption during each of the past eight years.  But the “you only live once” mentality that emerged from the 2020 Covid lockdowns, coupled with a desire to live in, and work from a healthier environment (via Zoom), became significant variables contributing to the sense of urgency for many to acquire a property on Martha’s Vineyard.  However, the resulting diminished levels of inventory due to the aggressive consumption, coupled with rising mortgage interest rates affecting affordability, and the ongoing geo-political and macro-economic issues of the day, have contributed to a notable cooling effect upon our local real estate activities this spring.

How the balance of the year unfolds will be enlightening, but opportunities for the prepared will certainly present themselves, especially as we migrate toward the “Fall Market” which typically commences just prior to Labor Day.

Here are the more meaningful statistics to consider through Second Quarter 2023: 

Despite the opening of the season and arrival of warmer temps, local inventory remains tight.  Clearly life moves on, and family decisions toward real estate holdings continue.  And at this time last year, there were 136 residential properties actively listed for sale Island-wide.  As of this moment, there are 141 units available.  From a historic perspective, there were typically 375-450 residential properties available to consider during this time of season.   In 2018, there were 558 available for purchase.

Thus far in 2023, a total of 135 residential properties were sold among the Island towns, which is down approximately 17% from last year’s sales of 162 for the same period:  Edgartown-46, Oak Bluffs-32, Vineyard Haven-30, West Tisbury-20, Chilmark-5, and Aquinnah-2.

Median residential sale prices on-Island have moderated, decreasing 5% from $1,480,000 to $1,399,000.  While the average residential sale prices decreased $4,609.00 from $2,117,320 to $2,112,711 as compared to the same period in 2022. 

Year-to-date residential sales in the aggregate have captured nearly 96% of final asking prices and garnered approximately 161% of their respective tax assessments.  The strength of this correlation is subject to factors such as condition, location, amenity, and uniqueness of the subject properties sold, but more importantly their competitiveness relative to available supply.  And these aspects differ within each village affecting sales valuation.

While decision-making drivers differ when deciding to acquire a vacation type home as compared to that of a primary residence, there are similar economic, emotional, logistic, and utilitarian variables that are employed when undertaking such a venture on-Island.  Our agents are skilled and savvy in helping you identify and address each of these concerns. Please contact us for assistance to discuss your specific questions, curiosities, wants and needs, concerning Martha’s Vineyard real estate.  And do regularly re-visit www.mvlandmarks.com to keep abreast of all Island properties actively offered for sale.