Happy belated New Year to one and all, and so long to 2023! As has become customary, we offer our annual installment of "The Year in Review" concerning Martha's Vineyard Real Estate activities.

The resilience demonstrated by the Vineyard market has been something to behold. Despite a climate of higher prices and increased lending rates, coupled with an extremely low level of inventory, the local market still eked out modest gains in closed sales prices on still fewer units than were sold in 2022.

The motivation to acquire property on-Island remains persistent. Unquestionably there are a greater number of prospective buyers that are chasing too few available properties, which is a competitive condition that will not easily be resolved without the creation of some meaningful supply. However, speculation that the Federal Reserve policy of higher interest rates may finally be coming to an end, with rate cuts to coincide with the arrival of the customary "spring market". This fundamental market change may spur some reluctant Island sellers when they list their homes as they plan to divest and move elsewhere while enjoying potentially lower mortgage rates themselves in the re-location off-island.

As has been mentioned in prior agency missives, markets like Martha's Vineyard have been experiencing inventory contraction for several years now, with rates of replenishment grossly lagging the level of consumption. Martha's Vineyard simply does not have an ample amount of raw land to develop to create adequate new housing stock. Thus, most of the local inventory comes from property re-sale decisions. New property listings are at an all-time low, but with the consistent high demand, premium sales prices can and likely will persist across the Island in the many months to come.

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.

         • The 4th Quarter again realized respectable volume in residential sales on-Island (comprised of single family, multi-family homes & condos) totaling (80), 

            exceeding Q1 (71), Q2 (71), but slightly lagging Q3 (90). Interestingly, during the past several years our "late Summer & Fall Market" has become a

            stronger selling period than the customary "Spring Market". However, with overall supply of inventory constrained, fewer properties may convey 

            while prices can remain elevated or even increase. Therefore, this could be a cue for potential sellers to enter the market with new listings come Spring,

            if not sooner. Especially if the Federal Reserve endeavors to begin an interest rate cutting cycle to commence in the Spring. Please contact us to discuss 

            the salability of your Island property.

         • In 2023, residential sales on-Island were realized from all price segments and locales totaling 295 units, which was approximately 11% fewer 

           than the 333 transacted in 2022. Median sales prices increased 2% from $1,520,000 to $1,550,000, while average sales prices rose just 4%, 

           from $2,219,996 to $2,303,138, year over year.

         • Sales prices on-Island captured 96% of their asking price and garnered 160% of their respective tax assessments in the aggregate. Each 

           Town has its own metric in this regard that is worth exploring.

         • For the year, Island towns conveyed the following number of residential properties; Edgartown-98, Oak Bluffs-76, Vineyard Haven-61, 

           West Tisbury-37, Chilmark-17, and Aquinnah-6.

         • 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 

            establishing value and pricing. However, in this post-Covid era, "wants and needs" have become more significant and subjective 

            variables affecting the decision-making process.

         • As inventory continues to be depleted, prices have escalated as a function of supply and demand. It is not surprising that within a 

           tight market condition, the better priced, better conditioned properties go under contract more quickly. But candidly, this can be 

           said of any inventory that becomes available on-Island because levels are at such extraordinarily low levels.

         • Our successful 2023 clients have these best practices in common: Know your wants and needs, have reasonable expectations,

            understand your purchasing power well in advance as lending rates continue to fluctuate, identify the market of opportunity

            as lean as it may be, expect competition, and "be prepared to act".

This past year was unprecedented for so many and in so many unforeseen ways. And the confluence of the aforementioned variables has made finding available inventory more challenging on-Island. The next few months will be telling with respect to determine the levels of inventory the spring market may present, so stay tuned!

Certainly, anything can happen, as was demonstrated during these past several years. And the Island's resilience as a discretionary market of desire will again be tested. However, for those individuals who perform their due diligence, work with an experienced Realtor and are ready to act, there are still opportunities to become a Buyer of Martha's Vineyard real estate. And if you are seeking lending resources to meet your particular needs, please allow us to introduce you to local loan officers who have mortgage portfolios that meet our micro-market parameters.

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