The Local REALTOR® View On Cape Cod Market Conditions


Steve Gregory Picture

(CAPE COD) September 2010 - The Cape Cod real estate market has floundered over the Summer of 2010, with sales across the board falling sharply from previous months and even from the dismal 2009 levels. (the volume of real estate sales in July 2010 was down 4.2% from July 2009 volume).

Well priced properties are still going under contract within days of listing, overall inventory is still good, days on market rising a bit, etc.

The market continues going through a period of downward adjustment.

Far too many sellers are still living in 2004 - those days are gone. While anything is theoretically possible, it is HIGHLY unlikely the selling prices on most properties will approach 80% of 2004 prices AND buyers are looking for different things.


WHAT IS A HOUSE WORTH?

  • For many years the formula to estimate value was 12 to 15 times annual rents in the area.
  • On Cape Cod, there are 'seasonal' & 'year round' houses
  • The 'season' is considered to be 10 weeks
  • $1200 a week x 10 weeks x 15 = $180,000
  • $1200 a month x 12 months x 12 = $216,000


  • What is your Mom's house worth?
  • Unlike conditions in a rising market, where a shortage of prime properties pushes buyers into less desirable properties (at higher prices), in a falling market buyers WAIT. The reality of this market appears to be that if you are willing to wait you can get a lower price.

    We have observed over the Spring and Summer that buyers are not looking to do any work - most properties that are selling are in move-in condition. This is a problem when you are thinking about selling Mom's house on the Cape - and nationally it is a factor in the decision to move into an assisted living facility.

    We found this analysis of the declining market and the decision making process of seniors in the August 24th, 2009 issue of Senior Housing News, a publication of www.seniorhousingnews.com:

    Assuming we have reached (or nearly have) a housing bottom, what does this mean for the senior living/housing industry? Not much in the near term. Seniors will continue to live in their current residence (unless a life event happens) for the next 2-3 years before realizing that the home equity they lost will not be regained in enough time to make postponing a downsizing or lifestyle change practical [emphasis mine]. A more interesting question might be how long would it take to regain just half of what they’ve lost?

    Think about the implications of this statement. It's a year old and we're still not seeing the bottom yet. The investment aspects of real estate are, and always have been, about timing. We, however, are mortal and our days numbered -- and we don't know what that number is!!

    Just as we cannot argue with the Lord when he calls us, we cannot successfully argue with the real estate market. If you are delaying a move into an assisted living facility on Cape Cod that would dramatically improve the quality of your or your Mom's life, consider this:

    • Every day you delay the asset funding the move further deteriorates.
    • Every day you delay the cost of assisted living on Cape Cod increases.
    • Every day you delay is a higher quality day wasted.

    If this situation sounds familiar to you, perhaps you should make the move now, and get on with your life, before the market deteriorates further. The signs ahead are all flashing "caution".

    Warning - Danger Ahead

    Get the house cleaned up and looking good,
    Use a Realtor® experienced in the CURRENT local market,
    Accept any reasonable offer.

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