Market Shows Signs of Returning to Normal in July
August 26, 2021 Research & Data CCIAOR Data and Research
Market Activity Signals Potential Return to Normal
The 12-month frenzy fueled by buyers seeking refuge and respite on Cape Cod has subsided as market activity is returning to pre-pandemic levels. But, this is occurring after the pandemic has altered the Cape Cod housing landscape for the foreseeable future.
Closed sales in July were down 39% from 2020 and sales that went pending in July were down 37% from last July.
However, the better comparison is to look at today’s market metrics compared to 2019 - before the pandemic-influenced housing market. Sales were slightly up in July 2021 compared to the same month in 2019, while pending sales were slightly down - indicating a potential return to a more normal market.
The toll the pandemic took on Cape Cod’s housing market is still being felt through supply and demand - and likely will be felt for some time. With very little new construction, the region’s inventory is still short, which keeps housing prices high.
“Inventory hasn’t rebounded and prices haven’t subsided, but market activity is slowing, which shows it may be the last chance for sellers to take advantage of a frenzy home buyer market and list now,” said Ryan Castle, CEO of the Cape Cod & Islands Association of Realtors.
The number of available homes for sale was down 51% from July 2020 - and median sales price was up 20%, a direct linkage of supply and demand.
So, while sales activity itself has returned to pre-pandemic levels, the prices and the available homes for sale may never return.
List Price is Catching Up With Accepted Offer Price
The frenzy of March and April and the way above asking price for homes spurred asking prices to rise to what is more thought of as a market price. This is resulting in less homes being sold above asking price.
July was the first month we saw where the percentage of closed sales saw a sales price higher than asking price showing a leveling off. In July, 61% of homes closed above asking price (off a June high of 65%); however, we are hearing from top agents that the accepted offers in July will show an even greater reduction in that percentage moving forward. This is partially due to the market returning to normal, but is also driven by REALTORS® being able to make more accurate list prices now that comparable sales have caught up to market performance.
Full Market Release
According to preliminary data released last week by the Cape Cod & Islands Association of REALTORS® (CCIAOR), 453 homes sold in July, 358 single-family homes and 95 condominiums. Median sales price was $600,000 for single-family homes and $395,000 for condominiums. Last July, 702 homes (590 single-family homes and 112 condos) sold at a median price of $496,500 for single-family homes and $338,500 for condominiums.
Sales pending at the end of July were 380 for single-family homes and 106 for condominiums – a 37.6 percent decrease for single-family and a 30.3 percent decrease for condominiums, which will show up in closed home sales in the coming months. Last July, there were 609 pending single-family homes and 152 pending condominiums.
New listings in July for single-family homes were 436 and 131 for condominiums. This is an 18.7 percent decrease, and a 4.4 percent decrease respectively from last July, which had 536 new listings for single-family homes and 137 new listings for condominiums.
At the end of July, there were 544 single-family homes for sale and 159 condominiums for sale in the Cape Cod & Islands Multiple Listing Service. Last July, there were 1,184 single-family homes and 398 condos listed for sale, a 54.1 percent decrease, and a 60.1 percent decrease, respectively.
Cumulative days on market for July decreased 79.2 percent for single-family homes compared to last July, dropping from 106 days to 22 days. Condominiums had a 60 percent decrease in cumulative days on market compared to last July, dropping from 115 days to 46 days.
Data released reflects all single-family homes and condominiums in the Cape Cod & Islands Multiple Listing Service for Barnstable County.