On October 17th, Heather Harper from the Cape Cod Housing Commission came to speak to Cape Cod & Islands Association of REALTORS®. Harper presented the results of the Commission’s recently released housing study that investigates aspects of the housing market on Cape Cod. The key points of the presentation revolved around housing demand versus housing availability, cost of housing, and the demographics of Cape Cod.
Housing supply continues to be in high demand on Cape Cod, with both year-round rental properties and affordable houses needing a big boost in inventory. According to the housing study, there is an approximate demand of 22,000 housing units, and 7,000 year-round rental units. This means that approximately 29,000 units need to be created on Cape Cod to properly meet the needs of permanent residents, as well as the those who visit Cape Cod to vacation or work in the summer months
As of October 2017, the median sold price for a single-family home in Barnstable County was $360,000. The housing study states that for homes to be considered affordable (at market rate) in this market, the median price should be $325,000. Last year, through October, the median single-family home was $335,000 which means Cape Cod is becoming less affordable for many homebuyers. Decreasing inventory has been a factor in this, and as stated above, an increase in development could be one solution.
The study shows that currently, the most units needed are for those earning under $60,000 a year. However, the study states that, “By 2025, the greatest increase in housing stress is for those projected to earn $90,000 a year or more (for owners).” As the lower end of the market has been slow for a few years, those earning incomes in the middle will start to see more stresses on housing availability in their price ranges. Combining the factors in these two income ranges has left homeowners who make between $70,000 and $90,000 annually with nowhere to go as they are unable to afford a bigger home or to downsize.
All the above factors are affecting the demographic shift in Barnstable County. With less families able to purchase homes here, the under-19 age group has decreased year-over-year from 22.9% in 1990, to 15.9% of the total population forecasted by 2025. This is also true in the 25-44 age group with a decrease from 35% of the population in 1990 to 21.8% forecasted in 2025. The over 65 age group has the biggest increase jumping from 22.1% in 1990 to 35.1% of the population forecasted by 2025. Implementing solutions to address the lack of inventory for median earners ue could be one step towards retaining more young families on Cape Cod.