High Demand, Low Supply Fuels Fast-Moving Cape Real Estate Market

Filed Under: Real Estate, Other News

The Cape Cod market started off 2021 by continuing its blistering pace from the record-setting year of 2020, with median sales price, pending and closed sales pushing ever higher while inventory and days on market continue to drop to lows hardly ever seen in this region.

Single family homes on the market in January 2021 sold on average 64 percent faster than homes on the market in January 2020. Buyers at all price points are finding limited homes for sale and multi-offer situations are commonplace, said Ryan Castle, CEO of Cape Cod & Islands Association of Realtors.

“It’s not an exaggeration to say this is the best time in terms of price and speed to sell your house on Cape Cod. We have reports of homes getting more than 50 showings in a weekend and more than 10 offers,” Castle noted.

Despite record buying power through historically low interest rates, housing on Cape Cod was 20 more more unaffordable in January 2021 than January 2020, according to CCIAOR’s Housing Affordability Index.

“Housing at all price points is needed to list for sale and build in today’s market. The biggest hurdle potential sellers are overcoming is where do they move if they sell?” said Castle. “Right now, the option for many is to simply leave the Cape. By getting more new housing to the market, we can start to unclog the bottleneck. This is not going to be easy or quick to recover from an inventory shortage squeezing prices higher.”

“Those getting squeezed out of housing in today’s market are those who traditionally could afford to buy on Cape Cod,” Castle continued.T”hey simply cannot compete with the addition of a new demographic of buyers who are looking towards the Cape as a result of the pandemic. We need to incentivize the creation of market rate middle income housing construction that is elusive to build due to a combination of regulation, and the costs of permitting, land, materials and labor.”

At the end of January, there were only 654 single-family homes and condominiums listed for sale in the Cape Cod and Islands Multiple Listing Service, a 56.5 percent drop in home sales from January 2020.

Data
According to preliminary data released last week by the Cape Cod & Islands Association of REALTORS®:

  • 361 homes sold in January, 297 single-family homes and 64 condominiums.
  • Median sales price was $570,000 for single-family homes and $302,500 for condominiums.
  • Last January, 345 homes (274 single-family homes and 71 condos) sold at a median price of $427,250 for single-family homes and $300,600 for condominiums.
  • Sales pending at the end of January were 277 for single-family homes and 96 for condominiums – a 33.8 percent increase for single-family and a 65.5 percent increase for condominiums, which will show up in closed home sales in the coming months.
  • Last January, there were 207 pending single-family homes and 58 pending condominiums.
  • New listings in January for single-family homes were 221 and 82 for condominiums. This is a 42.6 percent decrease, and a 17.2 percent decrease respectively from last January, which had 385 new listings for single-family homes and 99 new listings for condominiums
  • At the end of January, there were 453 single-family homes for sale and 201 condominiums for sale in the Cape Cod & Islands Multiple Listing Service.
  • Last January, there were 1,448 single-family homes and 399 condos listed for sale, a 68.7 percent decrease, and a 49.6 percent decrease, respectively.

 

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