Inventory Shortage Could Stunt Cape Cod Economy Moving Forward
December 17, 2020 Research & Data CCIAOR Data and Research
Demand for Cape Cod real estate remained strong in November, as 577 homes sold and the median sales price climbed to $585,000 for single-family homes. However, several key indicators showed signs of things beginning to slow as a shortage of homes for sale begins to impact the market.
"Inventory shortages of homes for sale could stunt further recovery of the entire Cape Cod economy. Real estate typically leads the way of economic progress on the Cape, but unless we start producing housing, the economy will continue to be held back," says CCIAOR CEO Ryan Castle.
The months supply of inventory for single-family homes dipped below 2 months in November, a sign of a significant imbalance between supply and demand and an extreme seller’s market. For reference, a ‘balanced’ market is typically equated with six to seven months of inventory. The amount of new listings at the end of November was at 335 – a 9.9% increase from November, 2019 – a hopeful sign that more inventory may be hitting the market in coming months – but homes are coming off as soon as they come on the market.
“There is huge demand for the properties coming on the market; however, the continued short supply of homes is getting shorter and that is holding back the real estate market," notes Castle. “The record setting pace we saw monthly through the fall will fade as both supply and the traditional quieter winter months slow the pace of the market, but will still end up much better than we see traditionally this time of the year.”
According to preliminary data released last week by the Cape Cod & Islands Association of REALTORS® (CCIAOR), 577 homes sold in November, 457 single-family homes and 120 condominiums. Median sales price was $585,000 for single-family homes and $399,950 for condominiums. Last November, 413 homes (335 single-family homes and 78 condos) sold at a median price of $440,500 for single-family homes and $288,650 for condominiums.
Sales pending at the end of November were 394 for single-family homes and 83 for condominiums – a 12.2 percent increase for single-family and a 9.8 percent decrease for condominiums, which will show up in closed home sales in the coming months. Last November, there were 345 pending single-family homes and 92 pending condominiums.
New listings in November for single-family homes were 335 and 78 for condominiums. This is a 27.4 percent increase, and a 9.9 percent increase respectively from last November, which had 263 new listings for single-family homes and 71 new listings for condominiums.
At the end of November, there were 724 single-family homes for sale and 233 condominiums for sale in the Cape Cod & Islands Multiple Listing Service. Last November, there were 1,691 single-family homes and 461 condos listed for sale, a 57.2 percent decrease, and a 49.5 percent decrease, respectively.
Cumulative days on market for November decreased 40.6 percent for single-family homes compared to last November, dropping from 106 days to 63 days. Condominiums had a 2.5 percent decrease in cumulative days on market compared to last November, dropping from 80 days to 78 days.
Data released reflects all single-family homes and condominiums in the Cape Cod & Islands Multiple Listing Service for Barnstable County.
For historic and town-by-town data please visit CapeCodRealEstateStats.com