March Market Insights - Nantucket Real Estate

NANTUCKET REAL ESTATE Market Insights BY JEN ALLEN MONTHLY SALES HIGHLIGHTS

LOWEST HOME SALE

HIGHEST HOME SALE

$10,250,000

$799,000

$2,800,000

2 ANNA DRIVE #5 MARKETED FOR [23 Days]

FISHER’S

68 NOBADEER AVENUE DIRECT NILB PURCHASE

KEY MARKET STATISTICS

REVIEW

ALL PROPERTY TYPES

FY 2022

Transactions

FY 2021

% CHANGE YOY

5-YEAR AVG.

85

153

-44% f

102

$267,061

$352,873

-24% f

$241,226

2.7

6

-55% f

6.4

96%

94%

2d

94%

Active Listings (March)

67

132

-49% f

200

Months Supply of Inventory

1.2

2.2

-46% f

6.3

New Contracts (March)

28

50

-44% f

32

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

NANTUCKET REAL ESTATE ACTIVITY THROUGH MARCH 2011–22

# of Transactions

Dollar Volume

MAR 22

2-6 HIGHLAND AVENUE MARKETED FOR [300 Days]

Two years ago, the Nantucket real estate market was all but at a standstill.

One year ago, all cylinders were firing, and the market was positioning for its most remarkable year yet. This year, transaction activity has been suppressed, only by limited inventory, while property values continue to impress. Through March 31, 2022, there were just 85 transactions, but total dollar volume was $267 million. This represented a respective decline of 44 percent and 24 percent from last year’s record first quarter performance. From the five-year average, this represented a transaction decline of 17 percent but an increase of 11 percent on a dollar volume basis and is significantly more in dollar volume than the last prepandemic first quarter periods with similar transaction values (2017 & 2019).

Given severe inventory constraints against persistently high demand, this trend in reduced transaction volume but solid dollar volume is one that will likely continue throughout the year. Here are Fisher’s first quarter market insights…

HIGHEST LAND SALE

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

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

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NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

1Q RESIDENTIAL & VACANT LAND SALES SUMMARY

RESIDENTIAL SALES ACTIVITY: 2022 V 2021 & 5-YEAR AVERAGE

SINGLE-FAMILY HOME SALES BY PRICE POINT PROPERTY SALES BETWEEN $4M - $6M DOUBLED

INVENTORY LEVELS HAMPERED TRANSACTION VOLUME 2021

Total Transactions Total Sales Dollar Volume Avg. Selling Price Median Selling Price Avg. Months on Market Avg. Price as % of Last Ask Avg. Price as % of Original Ask Avg. Price as % of Assessed Value •

MAR 22

•

2020

5-Year Avg (2018-22)

% Change

55

95

-42% f

66

$214,591,667

$273,947,125

-22% f

$187,850,742

$3,901,667

$2,883,654

35% d

$2,861,148

$3,500,000

$2,250,000

56% d

$2,207,000

3.0

5.5

-46% f

7.0

96%

94%

2d

94%

95%

90%

5d

90%

175%

137%

37d

141%

With property inventory off 63 percent from the five-year March average, it’s no surprise that the number of single-family home sales (excluding condos, multi-family homes, co-ops & covenant properties) fell more than 40 percent from 1Q21. Despite the reduced transaction volume, dollar volume fell only 22 percent thanks to a continued rise in property values, which led to a larger percentage of sales at higher price points than one year ago.

While pricing metrics are certain to shift with more transaction data in the months ahead, first quarter sales reflected a 56 percent year-over-year rise in the median home sale value while the average value rose 35 percent (see next section). With the continued strength in demand, marketing times once again fell dramatically, averaging just three months for the homes sold in the first quarter of 2022 versus the five and a half months it took for homes to sell during the first quarter of 2021. With more and more full-price transactions occurring, pricing discounts narrowed to just five percent of the original asking price and four percent of the last asking price.

•

In reviewing 1Q22 sales by price point against both 1Q21 and the five-year average, we can see that the number of homes sold for less than $1 million fell from representing 11 and 12 percent respectively, to just two percent of transactions so far this year. There was an even more notable percentage point decline in home sales between $1 million and $2 million, which fell from representing 34 to 35 percent of the market to 20 percent through the first quarter. Most notably, at least thus far, is that home sales between $4 million and $6 million more than doubled in 1Q22 from both last year and the five-year average, helping to explain the significant rise in both the median and average home sale values from these previous periods.

•

The upper stratosphere of Nantucket’s real estate market has been making notable splashes in the headlines lately but as of 1Q22, there were just two transactions between $10 million and $20 million and none above $20 million on the books. This will shift in a material way as we get into second quarter data as there have already been at least three transactions above $20 million and there are additional properties under contract in this range. As more and more transactions close in 2022, we anticipate there could be a more balanced pricing distribution among transactions to moderate average home values, but we know that the high-end of the market is poised for another active year.

FORWARD MARKET INDICATORS

INVENTORY LEVELS BY PRICE POINT

HISTORICAL COMPARISON OF CONTRACT ACTIVITY

FEWER THAN 70 PROPERTIES FOR SALE MARKET-WIDE

CONTRACT ACTIVITY FORCED TO MODERATE

Q1

•

As of March 31, 2022, total inventory for all Nantucket property types (residential, land and commercial properties) market-wide totaled a record low of 67 properties. This compares to 132 properties one year ago and 274 properties in 2020.

•

In looking at the three-year history of single-family listings by price point as of the end of the first quarter, there is a dramatic reduction in inventory for every million-dollar price point for each year until the $5 million segment where inventory remained steady 1Q21 to 1Q22. This high-end of the market is the only segment where inventory levels didn’t decline by more than half over the last year and may explain why we are seeing more high-end activity so far this year.

•

• •

Q2

Q3

Q4

With less than 70 properties on the market by the end of the first quarter, a moderation in contract activity was bound to happen. In total, there were 81 Offers and Purchase and Sale agreements recorded (duplicates excluded) through March 31, 2022. This is far more in line with what could be described as normal activity than the incredible 138 contracts recorded during 1Q21. January saw the most numerous contracts (33), February registered a bit of a dip (20), and the March rebounded with 28 contracts during the month. What these figures don’t capture are the private transactions that only hit the MLS post-closing and didn’t reflect an Offer or P&S status during the first quarter.

Most of the first quarter contracts, 36 percent, were for properties last priced between $1 million and $2 million, down from the 48 percent for this segment in 1Q21. New contract activity for the $2 million to $3 million saw 25 percent of the activity while properties last priced between $3 million and $4 million saw 14 percent. For the upper end of the market above $5 million, there were just three contracts recorded, or 12 percent of all contract activity. Once again, this doesn’t capture the private contacts that likely took place during this period.

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

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NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

RESIDENTIAL SALES ACTIVITY: 2022 V 2021 & 5-YEAR AVERAGE REDUCED TRANSACTION VOLUME BUT VALUES REMAINED STRONG 2021

Total Transactions

% Change

5-Year Avg (2018-22)

55

95

-42% d

66

$214,591,667

$273,947,125

-22% d

$187,850,742

$3,901,667

$2,883,654

35% d

$2,861,148

$3,500,000

$2,250,000

56% d

$2,207,000

3.0

5.5

-46% f

7.0

Avg. Price as % of Last Ask

96%

94%

2d

94%

Avg. Price as % of Original Ask

95%

90%

5d

90%

175%

137%

37d

141%

Total Sales Dollar Volume Avg. Selling Price Median Selling Price Avg. Months on Market

MAR 22

2020

Avg. Price as % of Assessed Value

•

With property inventory off 63 percent from the five-year March average, it’s no surprise that the number of single-family home sales (excluding condos, multi-family homes, co-ops & covenant properties) fell more than 40 percent from 1Q21. Despite the reduced transaction volume, dollar volume fell only 22 percent thanks to a continued rise in property values, which led to a larger percentage of sales at higher price points than one year ago.

•

While pricing metrics are certain to shift with more transaction data in the months ahead, first quarter sales reflected a 56 percent year-over-year rise in the median home sale value while the average value rose 35 percent (see next section). With the continued strength in demand, marketing times once again fell dramatically, averaging just three months for the homes sold in the first quarter of 2022 versus the five and a half months it took for homes to sell during the first quarter of 2021. With more and more full-price transactions occurring, pricing discounts narrowed to just five percent of the original asking price and four percent of the last asking price.

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

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NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

SINGLE-FAMILY HOME SALES BY PRICE POINT

MAR 22

PROPERTY SALES BETWEEN $4M - $6M DOUBLED

•

In reviewing 1Q22 sales by price point against both 1Q21 and the five-year average, we can see that the number of homes sold for less than $1 million fell from representing 11 and 12 percent respectively, to just two percent of transactions so far this year. There was an even more notable percentage point decline in home sales between $1 million and $2 million, which fell from representing 34 to 35 percent of the market to 20 percent through the first quarter. Most notably, at least thus far, is that home sales between $4 million and $6 million more than doubled in 1Q22 from both last year and the five-year average, helping to explain the significant rise in both the median and average home sale values from these previous periods.

•

The upper stratosphere of Nantucket’s real estate market has been making notable splashes in the headlines lately but as of 1Q22, there were just two transactions between $10 million and $20 million and none above $20 million on the books. This will shift in a material way as we get into second quarter data as there have already been at least three transactions above $20 million and there are additional properties under contract in this range. As more and more transactions close in 2022, we anticipate there could be a more balanced pricing distribution among transactions to moderate average home values, but we know that the high-end of the market is poised for another active year.

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

4

NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

INVENTORY LEVELS BY PRICE POINT

MAR 22

FEWER THAN 70 PROPERTIES FOR SALE MARKET-WIDE

•

As of March 31, 2022, total inventory for all Nantucket property types (residential, land and commercial properties) market-wide totaled a record low of 67 properties. This compares to 132 properties one year ago and 274 properties in 2020.

•

In looking at the three-year history of single-family listings by price point as of the end of the first quarter, there is a dramatic reduction in inventory for every million-dollar price point for each year until the $5 million segment where inventory remained steady 1Q21 to 1Q22. This high-end of the market is the only segment where inventory levels didn’t decline by more than half over the last year and may explain why we are seeing more high-end activity so far this year.

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

5

NANTUCKET REAL ESTATE Market Insights

BY JEN ALLEN

HISTORICAL COMPARISON OF CONTRACT ACTIVITY

MAR 22

CONTRACT ACTIVITY FORCED TO MODERATE

Q1

•

• •

Q2

Q3

Q4

With less than 70 properties on the market by the end of the first quarter, a moderation in contract activity was bound to happen. In total, there were 81 Offers and Purchase and Sale agreements recorded (duplicates excluded) through March 31, 2022. This is far more in line with what could be described as normal activity than the incredible 138 contracts recorded during 1Q21. January saw the most numerous contracts (33), February registered a bit of a dip (20), and the March rebounded with 28 contracts during the month. What these figures don’t capture are the private transactions that only hit the MLS post-closing and didn’t reflect an Offer or P&S status during the first quarter.

Most of the first quarter contracts, 36 percent, were for properties last priced between $1 million and $2 million, down from the 48 percent for this segment in 1Q21. New contract activity for the $2 million to $3 million saw 25 percent of the activity while properties last priced between $3 million and $4 million saw 14 percent. For the upper end of the market above $5 million, there were just three contracts recorded, or 12 percent of all contract activity. Once again, this doesn’t capture the private contacts that likely took place during this period.

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

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