It was the best of times; it was the worst of times! True of late 18th century London and Paris and true of the 2020 Cape Cod Real Estate Market. Let’s take an in-depth look at the factors and numbers that defined this year’s market.
At the onset, the 2020 market was off to a good start, with pending sales, new listings, and median prices all notably ahead when compared to 2019. But as fears of the coronavirus spread, the market began showing signs of weakness by the end of March, with pending sales down 12% and new listings down 14% compared to March 2019. The “bottom” came in April, with pending sales down 43% and new listings down 58% compared to April 2019. Median sale prices were holding steady, just slightly above their 2019 levels.
As May came to a close, it was obvious that both buyers and sellers were beginning to re-enter the market. Pending sales were only off by 12% compared to 2019, and new listings were off 28% — a substantial improvement over April. During this time, Governor Baker announced his “Re-Opening Massachusetts” plan, and confirmed that businesses and short-term rentals could likely begin opening and operating as early as late May. By the end of June, the vacation rental market was soaring, people were flocking to restaurants to dine outdoors, and an overwhelming number of new buyers entered the market, hoping to find their home-away-from-home on Cape Cod.
The feeding frenzy continued right into the Fall, and while sellers did resume their delayed plans to list their homes, it wasn’t enough to keep up with the volume of buyers. By the end of November, closed sales year-to-date were up 17% over last year, and median sale prices were up 18%. But inventory of available homes was DOWN 57%, despite new listings being off only 4% compared to 2019. Buying continued at an unprecedented pace, with pending sales – even in November – up 23%. December promises to be equally as strong.
If you were a seller in the second half of the year, surely these were the best of times. Bidding wars were almost a given on any new, nicely updated listing and the best homes didn’t last on the market more than 72 hours. Buyers, unfortunately, have been enduring more of the worst of times, with more than a dozen buyers frequently competing for the same house and many buyers losing repeatedly to the advantages enjoyed by cash buyers.
So what’s in store for 2021? It’s hard to say. Buyer activity will continue to be strong, as mortgage rates continue to be low and many buyers never found their home in 2020. Inventory is very low heading into 2021, but news of the strong seller’s market will likely entice many more sellers to list their homes after the Holidays.
Bottom line: if you’re thinking of selling, there may be no better time to list than right now. The market can change on a dime and history shows it won’t remain a seller’s market forever. If you’re a buyer, be sure that you are ready to pounce when your dream home shows up in your mailbox! Be sure your Realtor has put you on INSTANT Daily Alerts and be sure you’ve spoken with your Lender and updated your pre-approval letter.
Whether buying or selling, be sure you’ve got a local real estate professional working hard on your behalf. If you don’t, it would be my privilege to assist you. Please contact me for immediate assistance. Have a Safe and Happy New Year!