Great Point Properties News

Posted June 12, 2010

Market Update

Nantucket real estate sales trends continue apace with total dollar and transaction volume up significantly from the same period last year. 

• Dollar volume totals $167,810,669 vs. $104,933,845 for 2009, a 60% increase;

• Transaction volume totals 102 vs. 57 for 2009, a 79% increase;

• Annualized sales are tracking to $547,000,000 or a 27% increase over last year. 

Nantucket House Sales

The Nantucket house sales market is marked by several notable factors:

• Of the 89 houses sold on Nantucket 64 were sold for under $1,500,000.  The median sale price is $1,022,500.  In contrast, the median asking price of all houses for sale as of May 31st (480 total) is $1,495,000.

• For properties sold, the average Days on Market was 290 vs. a current 319 for listed properties.

Nantucket Land Sales

Nantucket land sales are still very slow with only 10 lots having sold to date.  Median sale price for properties that have sold is just $823,000.  

The Numbers

As noted in our May update, sales activity still focuses in the lower end of the market.  37% of the current real estate listings are asking $2,000,000 or more but less than 26% of the sales are in that same range. This is also holding true for properties under contract  to sell with all but 2 of 33 properties under contract listed for less than $2,000,000. The average asking price for these properties is $1,069,000, well below the median of $1,495,000 for currently listed properties. Great Point Properties expectation is to see a change in this trend as we head to the heart of the Nantucket selling season.  As we move into July we will see how that bears out. 

Summary

Yet the overall trend suggests that we have bounced off the bottom.  From September 2009 thru May 2010 total real estate sales have been $430,010,836 vs. $290,422,341 for the same period the year before, a 48% increase.  This represents a prolonged and significant sales increase.  Although we still operate in a buyer-dominated market, this trend will eventually start to solidify prices and move the momentum back toward the Seller.  This coming summer could be the last time for many years when the Buyer has a solid advantage.  Prices have declined 25% to 30%, inventory is significant and interest rates are very low. Will these characteristics define the market 12 months from now?  We tend to doubt it, from the simple observation that trends will always change given enough time.  After 4 years of declining sales, the upswing has begun.

Posted April 27, 2010

THE MORE THINGS CHANGE THE MORE THEY STAY THE SAME

The 1^st quarter of 2010 has shown the continued steady improvement in sales that we noted last fall.  Since hitting the nadir early last summer, sales, in both transaction and dollar volume, have continued to increase based on the year over year comparison.  Some key statistics are:

· Sales prices are at 89% of asking prices vs. 90% for 2009

· Days on market for 2010 are 289 vs. 263 for 2009

These figures are very similar to 2009 and underscore the nature of our market.  Although we have seen almost a doubling of transaction and dollar volume, the overall market remains clearly in the Buyer’s court.

IT IS A GOOD TIME TO BUY, Chapter 4

Several factors dominate the Nantucket real estate sales climate.  Inventories remain high and will climb as we go into the summer selling season.   As we have been in the well-documented bear market for 2 plus years, the high inventory of homes for sale puts pressure on pricing.  Although we have seen a bounce off the bottom, Buyers are still wary.  Current sales volumes will not significantly deteriorate the inventory.

Coupled with this scenario are the continued historically low interest rates.  Coupling these lending rates with prices that are 25% to 30% off the 2005 peak creates significant cost decline over the last bull market of 2003 to 2005.

With that said, it is our firm belief that Nantucket remains one of the top seasonal communities in the United States.  People love to come here (our vacation rentals for 2010 are significantly ahead of last year).  Nantucket offers history, natural beauty, great beaches, boating, fishing, the best restaurants, arts, and shopping just to scratch the surface.  Families come here, and over the years, Nantucket becomes the focus for them to reunite every year. That is the fundamental underlying strength of the Nantucket real estate market.  And that remains clearly intact.

Although it is fashion to make grand pronouncements about the future, we know how foolish this is.  No amount of number crunching will give any individual a clear view of our market 1 or 2 years out.  But, based on history, I know Nantucket’s real estate market will over the long term improve.  Simple supply and demand rules dictate a long term up trend.  Today, after 3 years of mediocre results, it is more likely we have seen the worst than not. 

CALL US.  WE ARE READY TO HELP.

We, at Great Point Properties, are happy to discuss the Nantucket real estate makert with you.  We live here and make real estate our profession.  We know the island and we can offer you the expertise, local knowledge, and service you deserve.  So give us a call.  The first step is to talk and to take a look.  And that does not cost anything.

NANTUCKET VACATION RENTALS

We are busy booking up for the 2010 rental season. If you are planning for a Nantucket summer vacation next year give us a ring.  We have over 600 great vacation houses to choose from and a very experienced rental staff to assist you.  As we approach the spring the better properties will be booked, time is of the essence.