Just because Cape Cod, Nantucket, and Martha’s Vineyard conjure up images of glitzy beach homes doesn’t mean these vacation hot spots were immune to coronavirus-induced economic downturns in the real estate market.
But all is no longer quiet on the Cape and Islands real estate front.
“We did see a pretty sharp falloff in business, inquiries, and listings. People pumped the brakes on putting their homes on the market in early March through April and into May,” said Emily Clark, president at Robert Paul Properties. “But there was a quick turnaround after Memorial Day, and we haven’t stopped since.”
The 781 pending home sales seen in June was a record high for Cape Cod, according to the Cape Cod & Islands Association of Realtors. July data isn’t yet available, but the June momentum is expected to continue through the end of summer. The association also expects accepted home offers to be up 10 percent for July compared with the same month in 2019.
“People are figuring out this is a better lifestyle and deciding to go back to the city just a few times a month,” said Ryan Castle, CEO of the association.
But the summer sales strength arrived after about 10 weeks of stinging slowdown due to the uncertainty of what the economic fallout would be from coronavirus.
In Barnstable County, pending single-family home sales were down by more than 43 percent in April, the first full month of the pandemic.
Brokers on Nantucket and Martha’s Vineyard noted that pending sales took longer to reflect the pandemic, as April was still a relatively normal month for sales due to deals closing that had been underway since early March. However, new contract activity declined by 88 percent on Nantucket in April compared with the same period in 2019, according to a Great Point Properties report.
“A lot of people held their breath for a few months and are now saying, ‘We had these plans in mind, we didn’t lose our jobs, so let’s move ahead with the plan we had in motion,’ ” said Nicolas Sandim, director of operations at Nichole Willey & Associates.
The summer Cape and Islands real estate market in 2020 is more than the usual round of vacationers finally moving ahead with long-held plans to buy a second home.
A mix of first-time home buyers, vacationers, and second homeowners looking for something year-round that can accommodate a home office have created a scenario more common in neighborhoods like Boston’s South End or Cambridge: bidding wars.
“I work in both Boston and Cape Cod, and it’s interesting to see the roles have reversed,” Clark said. “There are many over-asking situations or even people waiving contingencies. This is not normal for Cape Cod.”
It is unclear whether bidding wars are a summer phenomenon or will remain a normal part of Cape Cod life, like traffic on the Sagamore Bridge or long lines to get into the Beachcomber in Wellfleet.
“We’ll see what the fall brings — hopefully more inventory,” Clark added with a laugh.
Brokers in the area are touting more than the recent sales spike as proof that the Cape and Islands are a solid home market. Median home prices continued to increase across Barnstable County every month this year, despite the brief slowdown in pending sales.
“A lot of the statistics were down those 10 weeks. One that didn’t dip was the sales price,” Sandim said. “Values are there. Returns on investment are there. That’s a good indicator of confidence.”