Nantucket Real Estate Agent Blog

The Nantucket Housing Crunch

Posted by Brian Sullivan

2/28/14 11:35 AM

P8187224For 17 years now I've been working the Real estate business on Nantucket selling and renting homes.  Seasonal housing has always been an issue on the island.  As any free market conditions ebb and flow to determine price: factors such as scarcity, relative supply and demand have cycled since 2008 and the economic recession.   As we enter into 2014 I have never seen housing for seasonal employees and year around residents more constrained than it is now.
If you live on Nantucket, have a home on Nantucket or are trying to move to Nantucket you likely know someone caught in the boom of the most recent upward cycle.  Over the last 3 months I have been getting 3 to 6 calls a week from families and singles alike looking for housing.  The network that Nantucket Association of Brokers uses has a request for housing almost daily, the problem is larger than most know, or comprehend. 
The bottom of the sales market has been very vigorous in recent months with new listings coming to market between $495,000 and $795,000 and securing offers very quickly (matter of days or weeks). Limited new construction has happened in this price point since the 2008 downturn for a myriad of reasons, lack of land supply, lenders not lending on construction loans and buyers ability to qualify.  Homes came out of inventory as we saw foreclosures happen on island mostly in this price point that sold to investors not occupying but attempting to flip.  These factors have created an unhealthy demand now for seasonal and year round housing that will take some time, years to alleviate since there are not any projects ready to break ground to add inventory to this segment of the market.
It seems the scramble is on to secure year round resident an employee housing.  Pricing is jumping to the point of unaffordable for both rents and purchase and the island will lose quality members of its community.  This cycle is not new on Nantucket, there are some new factors like scarcity of land to build on but the housing crunch is something that we will all deal with in one way or another.  From past experience I’ve seen market pricing to increase dramatically in the upper price points once the lower end sells off and that time is here now, very similar thing happened in the 2004 market.
These are examples of the type of property selling now.

25bdaffThis property at 25 B Daffodil was listed at $499,000.  It is a 2 bedroom 1 bath condo above garage, accepted offer after only 4 weeks on market. 

appleAppleton Road Property on 1/4 acre listed at $649,000 had multiple offers before going under contract only two weeks after listing. 

bartlettrd4 Bedroom home on Bartlett Road with 1 bedrooms in basement 2 on 2nd floor was listed for $649,000 and went under contract in 60 days, mid winter.  

The list goes on….. there are currently 36 properties listed for sale under $800K, and 25 properties under contract below 800.

Topics: Nantucket, nantucket real estate transactions


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