June Market Insights - Nantucket Real Estate

NANTUCKET REAL ESTATE Market Insights BY JEN ALLEN MONTHLY SALES HIGHLIGHTS

QUICKEST SALE

HIGHEST SALE

$7,888,000

$5,200,000

5 SANDY DRIVE MARKETED FOR [17 Days]

KEY MARKET STATISTICS

REVIEW

ALL PROPERTY TYPES

FY 2021

Transactions

FY 2020

% CHANGE YOY

5-YEAR AVG.

339

128

165% d

205

$881,137

$323,695

172% d

$481,559

5.3

6.3

-16% f

6.5

95%

92%

3d

94%

Active Listings (June)

171

350

-51% f

312

Months Supply of Inventory

2.4

11.0

-78% f

11.0

57

57

0%

33

Dollar Volume ($in 000s) Avg. Months on Market Sale Price to Last Ask Price

New Contracts (June)

NANTUCKET REAL ESTATE ACTIVITY THROUGH JUNE 2011–21

# of Transactions

For the first time in island history, every single month posted over $100 million in sales through June 30, 2021.

April activity alone witnessed more than $250 million. Suffice it to say, the Nantucket real estate market continues on the trajectory that commenced just about 12 months ago. Cumulatively, through June 30, 2021, activity soared to 339 transactions totaling $881 million, a respective 165 percent and 172 percent increase from one year ago. Even compared to the five-year average, however, transaction volume increased by 65 percent while dollar volume surged 83 percent. At the time of this writing, there was also over $300 million in the pipeline, suggesting 2021 is on track to meet or surpass 2020 results. The looming question is whether inventory levels will be sufficient to meet at least part of the demand. Here are Fisher’s first half market insights…

$5,995,000

2 OKORWAW AVENUE MARKETED FOR [2 Days]

Dollar Volume

JUNE 21

23 BROAD STREET PRIVATELY MARKETED

FISHER’S

HIGHEST LAND SALE

Dollar Volume per Quarter

Q1

Q2

# of Transactions

© 2 0 2 1 F I S H E R R E A L E S TAT E

(508) 228–4407 21 MAIN STREET, NANTUCKET, MASSACHUSETTS

1

NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

1H21 RESIDENTIAL SALES ANALYSIS

RESIDENTIAL SALES ACTIVITY

VACANT LAND SALES ACTIVITY

TRANSACTION VOLUME STILL ROARING

LOT SALES ENJOYING A BANNER YEAR

2021

Total Transactions Total Sales Dollar Volume

% Change

5-Year Avg (2017-21)

209

98

113% d

138

$633,432,887

$282,798,600

124% d

$373,106,969

2021

Transactions Total Sales Dollar Volume

2020

% Change

5 Year Avg (2017–21)

69

15

360% d

34

$103,171,622

$19,237,700

436% d

$45,091,319

Avg. Selling Price

$3,030,779

$2,885,700

5% d

$2,666,697

Avg. Selling Price

$1,495,241

$1,282,513

17% d

$1,243,838

Median Selling Price

$2,537,500

$2,050,000

24% d

$1,965,100

Median Selling Price

$1,100,000

$845,750

30% d

$903,150

5.0

6.7

-25% f

6.6

6.7

5.3

25% d

8.0

95%

91%

4d

93%

97%

97%

0

95%

Avg. Months on Market Avg. Price as % of Last Ask Avg. Price as % of Original Ask Avg. Price as % of Assessed Value •

•

JUNE 21

2020

•

93%

86%

7d

89%

147%

127%

20d

130%

Single-family home sales (excluding condos, co-ops & 40B/covenant properties) continued to enjoy strong momentum through the first half of the year. Each month saw transaction volume that was nearly double the figures witnessed in 2020. As of June 30, 2021, there were 209 transactions totaling $633 million in total dollar volume. This represented a 113 percent year-over-year increase in transactions and a 124 percent increase in dollar volume thanks to higher end transaction activity.

As compared to the five-year average, transaction levels were 51 percent higher while dollar volume increased 70 percent.

At 33 percent of total sales, transactions between the $1M and $2M price point represented the biggest slice of the pie, just slightly lower than the distribution in 2020 and the five-year average. The price point which saw the most notable annual jump in transactions was the $3 million to $4 million segment, which represented 17 percent of sales as of June 30, 2021. This compared to just eight percent in 2020. Sales between $4 million and $5 million also saw nearly triple the first half volume of both 2020 and the five-year average.

Single-family home inventory levels measured 259 properties one year ago but plummeted to just 132 properties by the end of June. With this dearth of inventory and a significant rise in transaction volume, the average marketing time shortened to a record-low of 5 months. Marketing times weren’t the only metric to see healthy improvement. The average home sale price rose five percent to $3.03 million while the median home sale value rose 24 percent (reflecting the shift into higher end price point sales from one year ago).

Avg. Months on Market Avg. Price as % of Last Ask Avg. Price as % of Original Ask

96%

93%

4d

92%

Avg. Price as % of Assessed Value

141%

145%

-5 f

133%

•

With single-family inventory difficult to come by, vacant lot sales have enjoyed a banner year with 69 land transactions totaling $103 million through June 30, 2021. This represented more than a three-fold increase from the 15 transactions totaling $19 million in 2020 and more than double the activity of the five-year average.

•

These lot sales ranged from the $280,000 sale of a 4,000 square foot lot on Larrabee Lane in the mid-island area, to a $7 million sale of a three-acre, waterfront parcel in Squam. Nearly half of the 69 lot sales that took place stem from large-parcel subdivisions created in recent years including, Cannonbury Lane (10 transactions), Sandpiper Place (8 transactions), Grey Lady Lane (6 transactions) and a few others.

•

While it is typically a little more challenging to compare annual changes in land metrics given their vastly different locations and lot sizes, we can more easily discern that the median lot sale price increase of 30 percent from 2020 is reflective of what’s happening among like-kind transactions. For example, a half-acre lot on Cannonbury Lane traded for $950,000 11 months ago, but another halfacre parcel traded for $1.25 million in June 2021. A similar narrative played out in the Grey Lady Lane neighborhood where a 5,000+ square foot lot traded for $565,000 in February 2020 but another of similar size traded for $700,000 in June 2021.

•

At just three percent, sales discounts from the list price were narrower than those of single-family homes in 2021 but overall marketing times were slightly longer at 6.7 months. Similar to single-family homes, vacant lot inventory was also dramatically lower, with just 22 properties listed for sale as of June 30, 2021. One year ago, there were 59 properties listed for sale.

FORWARD MARKET INDICATORS

CONTRACT ACTIVITY

NANTUCKET PROPERTY INVENTORY

HEALTHY NEW PURCHASE ACTIVITY IN JUNE

Q1

Q2

Q3

Q4

•

Despite historically low inventory, new purchase activity remained exceptionally vibrant through the first half of the year. Recorded contracts (Offers to Purchase and Purchase & Sale Contracts excluding duplicates) soared to a seasonal high of 72 contracts in April before dropping to a more moderate, but still historically robust, 57 contracts in May and June.

•

Most of the June contracts, 35 percent, were for properties last priced between $1 million and $2 million, notably higher than the 28 percent that comprised this segment in 2020. New contract activity for the $2 million to $3 million price point decreased six percentage points from one year ago, while properties last listed between $3 million and $4 million saw a modest bump. The high-end of the market ($5 million+) held roughly steady from one year ago, at least for what was noted in the MLS. We are aware of a few, off-market high-end transactions that are not reflected in the public data.

•

INVENTORY REMAINED AT HISTORIC LOWS

Historically, the third quarter is the strongest quarter for new contracts. And given the third quarter of 2020 saw exceptional contract activity from pent-up pandemic demand, it will be interesting to see how 2021 compares. So long as there is sufficient inventory to keep contract activity steady, the market should be on track to meet or surpass 2020 totals. We know that there are still several notable off-market transactions to post so you can bet we will be keeping a close eye.

•

Across every property type and price point, total inventory figures continued to trend downward, setting new records for historic lows. As of June 30, 2021, there were just 171 properties listed for sale including residential (143), commercial (6) and vacant land (22) listings. This represented a decline of 51 percent from one year ago. The total months’ supply, or how long it would take to sell all listings based on trailing 12-month sales, measured three months for residential properties, one month for vacant land and one month for commercial properties. That’s an incredible thing to write in this report…

•

Every price point, with the exception of properties priced for $8 million or above, had markedly less inventory than one year ago. The $2 million to $3 million segment saw the largest year-overyear declines, while the $4 million to $5 million price point was also considerably lower. It’s for these reasons that we continue to see many multiple-bid scenarios when new listings come to market and also why many buyer’s agents are seeking off-market listings to try and satisfy buyer demand.

(508) 228–4407 21 MAIN STREET, NANTUCKET, MASSACHUSETTS

2

NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

RESIDENTIAL SALES ACTIVITY TRANSACTION VOLUME STILL ROARING 2021

Total Transactions

% Change

5-Year Avg (2017-21)

209

98

113% d

138

$633,432,887

$282,798,600

124% d

$373,106,969

Avg. Selling Price

$3,030,779

$2,885,700

5% d

$2,666,697

Median Selling Price

$2,537,500

$2,050,000

24% d

$1,965,100

5.0

6.7

-25% f

6.6

Avg. Price as % of Last Ask

95%

91%

4d

93%

Avg. Price as % of Original Ask

93%

86%

7d

89%

147%

127%

20d

130%

Total Sales Dollar Volume

Avg. Months on Market

Avg. Price as % of Assessed Value

JUNE 21

2020

•

Single-family home sales (excluding condos, co-ops & 40B/covenant properties) continued to enjoy strong momentum through the first half of the year. Each month saw transaction volume that was nearly double the figures witnessed in 2020. As of June 30, 2021, there were 209 transactions totaling $633 million in total dollar volume. This represented a 113 percent year-over-year increase in transactions and a 124 percent increase in dollar volume thanks to higher end transaction activity. As compared to the five-year average, transaction levels were 51 percent higher while dollar volume increased 70 percent.

•

At 33 percent of total sales, transactions between the $1M and $2M price point represented the biggest slice of the pie, just slightly lower than the distribution in 2020 and the five-year average. The price point which saw the most notable annual jump in transactions was the $3 million to $4 million segment, which represented 17 percent of sales as of June 30, 2021. This compared to just eight percent in 2020. Sales between $4 million and $5 million also saw nearly triple the first half volume of both 2020 and the five-year average.

•

Single-family home inventory levels measured 259 properties one year ago but plummeted to just 132 properties by the end of June. With this dearth of inventory and a significant rise in transaction volume, the average marketing time shortened to a record-low of five months. Marketing times weren’t the only metric to see healthy improvement.

The average home sale price rose five percent to $3.03 million while the median home sale value rose 24 percent (reflecting the shift into higher end price point sales from one year ago).

(508) 228–4407 21 MAIN STREET, NANTUCKET, MASSACHUSETTS

3

NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

VACANT LAND SALES ACTIVITY LOT SALES ENJOYING A BANNER YEAR

2021

Transactions

% Change

5 Year Avg (2017–21)

69

15

360% d

34

$103,171,622

$19,237,700

436% d

$45,091,319

Avg. Selling Price

$1,495,241

$1,282,513

17% d

$1,243,838

Median Selling Price

$1,100,000

$845,750

30% d

$903,150

6.7

5.3

25% d

8.0

Avg. Price as % of Last Ask

97%

97%

0

95%

Avg. Price as % of Original Ask

96%

93%

4d

92%

Avg. Price as % of Assessed Value

141%

145%

-5 f

133%

Total Sales Dollar Volume

Avg. Months on Market

JUNE 21

2020

•

With single-family inventory difficult to come by, vacant lot sales have enjoyed a banner year with 69 land transactions totaling $103 million through June 30, 2021. This represented more than a three-fold increase from the 15 transactions totaling $19 million in 2020 and more than double the activity of the five-year average.

•

These lot sales ranged from the $280,000 sale of a 4,000 square foot lot on Larrabee Lane in the mid-island area, to a $7 million sale of a three-acre, waterfront parcel in Squam. Nearly half of the 69 lot sales that took place stem from large-parcel subdivisions created in recent years including, Cannonbury Lane (10 transactions), Sandpiper Place (8 transactions), Grey Lady Lane (6 transactions) and a few others.

•

While it is typically a little more challenging to compare annual changes in land metrics given their vastly different locations and lot sizes, we can more easily discern that the median lot sale price increase of 30 percent from 2020 is reflective of what’s happening among like-kind transactions. For example, a half-acre lot on Cannonbury Lane traded for $950,000 11 months ago, but another half-acre parcel traded for $1.25 million in June 2021. A similar narrative played out in the Grey Lady Lane neighborhood where a 5,000+ square foot lot traded for $565,000 in February 2020 but another of similar size traded for $700,000 in June 2021.

•

At just three percent, sales discounts from the list price were narrower than those of single-family homes in 2021 but overall marketing times were slightly longer at 6.7 months. Similar to single-family homes, vacant lot inventory was also dramatically lower, with just 22 properties listed for sale as of June 30, 2021. One year ago, there were 59 properties listed for sale.

(508) 228–4407 21 MAIN STREET, NANTUCKET, MASSACHUSETTS

4

NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

CONTRACT ACTIVITY

JUNE 21

HEALTHY NEW PURCHASE ACTIVITY IN JUNE

Q1

Q2

Q3

Q4

•

Despite historically low inventory, new purchase activity remained exceptionally vibrant through the first half of the year. Recorded contracts (Offers to Purchase and Purchase & Sale Contracts excluding duplicates) soared to a seasonal high of 72 contracts in April before dropping to a more moderate, but still historically robust, 57 contracts in May and June.

•

Most of the June contracts, 35 percent, were for properties last priced between $1 million and $2 million, notably higher than the 28 percent that comprised this segment in 2020. New contract activity for the $2 million to $3 million price point decreased six percentage points from one year ago, while properties last listed between $3 million and $4 million saw a modest bump. The high-end of the market ($5 million+) held roughly steady from one year ago, at least for what was noted in the MLS. We are aware of a few, offmarket high-end transactions that are not reflected in the public data.

•

Historically, the third quarter is the strongest quarter for new contracts. And given the third quarter of 2020 saw exceptional contract activity from pent-up pandemic demand, it will be interesting to see how 2021 compares. So long as there is sufficient inventory to keep contract activity steady, the market should be on track to meet or surpass 2020 totals. We know that there are still several notable off-market transactions to post so you can bet we will be keeping a close eye.

(508) 228–4407 21 MAIN STREET, NANTUCKET, MASSACHUSETTS

5

NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

NANTUCKET PROPERTY INVENTORY

JUNE 21

INVENTORY REMAINED AT HISTORIC LOWS

•

Across every property type and price point, total inventory figures continued to trend downward, setting new records for historic lows. As of June 30, 2021, there were just 171 properties listed for sale including residential (143), commercial (6) and vacant land (22) listings. This represented a decline of 51 percent from one year ago. The total months’ supply, or how long it would take to sell all listings based on trailing 12-month sales, measured three months for residential properties, one month for vacant land and one month for commercial properties. That’s an incredible thing to write in this report…

•

Every price point, with the exception of properties priced for $8 million or above, had markedly less inventory than one year ago. The $2 million to $3 million segment saw the largest year-over-year declines, while the $4 million to $5 million price point was also considerably lower. It’s for these reasons that we continue to see many multiple-bid scenarios when new listings come to market and also why many buyer’s agents are seeking off-market listings to try and satisfy buyer demand.

(508) 228–4407 21 MAIN STREET, NANTUCKET, MASSACHUSETTS

6