What is going on in the Martha’s Vineyard Real Estate housing market? Interest rates just went up a bit, demand is still incredibly strong and we don’t know if there will be more inventory coming on the market over the next several months and if rates will continue to go up! Even the best economists are scratching their heads on this.
This February, the average day’s properties were on the market was 84. Last February, it was 601!
The average sale price on the Vineyard. Last February, the number was approximately 1.5 Million. This year, it’s 2.1 million. So, yes, a lot has changed in one year. Do we expect prices to go up? Appreciation for the Martha’s Vineyard Real Estate Market
was over 20% last year.
Home prices are forecasted to continue nationally at about 6%, which means we will see something slightly higher than that on Martha’s Vineyard.
Now, let’s talk about inventory. We all know demand continues to be high. The million-dollar question is, will we see more inventory this spring & summer? Many economists have predicted that as the Covid-19 vaccine becomes more available and as the economy improves, homeowners will start to list their homes. This certainly makes sense, but on the flip side, we have many people with great equity gains considering selling, but realizing they don’t have anywhere to go.
Odeta Kushi, Deputy Chief Economist at First American said “ The lack of existing homes available for sale remains the only drag on housing market potential. Many homeowners may want to upgrade, but do not for fear that they will be unable to find a home to buy, preventing more supply from reaching the market and exacerbating the lack of inventory. As a result, everyone ‘stays put’ and the supply of homes for sale dwindles further.” Seems to me, we’re back at square one with a continued inventory problem sticking with us for the remainder of the year.
And mortgage rates? Not sure anyone really knows what will happen there. Lawrence Yun, Chief Economist at the National Association of Realtors said “home sales could possibly reach 8 million if we had more inventory… Mortgage rates should remain very low throughout 2021, although we may have seen the lowest already.”
I think overall the predictions are positive, in that nobody is predicting rates to go up significantly and I think we all knew the historic lows couldn’t last indefinitely.
On March 4th, Sam Khater, Chief Economist at Freddie Mac said that “since reaching a low point in January, mortgage rates have risen by more than 30 basis points, and the impact on purchase demand has been noticeable. While purchase activity remains high, it has cooled off over the last few weeks and is currently on par with early March, prior to the pandemic.
However, the rise in mortgage rates over the next couple of months is likely to be more muted in comparison to the last few weeks, and we expect a strong spring sales season” In closing, It seems to me that demand will remain very high through the spring and summer, as buyers hope to purchase while interest rates are just starting to creep up. Hopefully, sellers will take note of this and realize that now is the time to put their house on the market to capitalize on this demand.
If you have any questions about the market in general or specifically about buying or selling on Martha’s Vineyard, or about the Martha’s Vineyard Real Estate market
please reach out!
Martha’s Vineyard Real Estate Market Update – March 2021