Fewer Island houses sold in 2007 for slightly more money than in 2006.
Despite a fourth-quarter rally, Island real estate transactions in 2007 declined 8.6 per cent, although median home sale prices increased 3.5 per cent from 2006.
Overall, fourth-quarter sales activity was the year’s strongest. But a three per cent increase in sales also included a seven per cent decline in median sales price.
The real estate business up-Island was much stronger in 2007 than down-Island towns, both in terms of sales and median home values. High-end property sales on the Island masked declines of up to 30 per cent in Oak Bluffs and Vineyard Haven.
“I think the decline is in lower price ranges Islandwide, not just in down-Island towns,” said Sharon Purdy, owner of Sandpiper Realty in Edgartown. “That’s going to continue until there is some resolution between unyielding sellers and buyers with inflated expectations.”
She said buyers need to understand that many prospective sellers don’t need to sell.
The 2007 median Island home price rose to $702,000 compared with $694,000 in 2006.
On the Vineyard, 324 residences sold in 2007 compared with 341 homes in 2006.
Fifty seven land sales took place on the Island last year, compared with 65 in the prior year. The median land price increased 22 per cent to $535,000 compared with $438,000 in 2006.
Across the Island, the median days on market for home sales rose 4.6 per cent from 237 to 248 days.
The fourth-quarter surge had realtors hopping. Patti Kendall, owner of Kendall and Kendall Real Estate in Vineyard Haven, said “I was pleasantly surprised. I worked more over this holiday season than I ever have in the past. We closed three properties between November and the New Year and put two more properties under contract in the past month.”
The Martha’s Vineyard Land Bank results mirrored the real estate market last year. The land bank showed a calendar year decline of seven per cent in revenues, according to executive director James Lengyel.
Mr. Lengyel also agrees with Island realtors who anticipate 2008 and 2009 will be much of the same.
“We believe in the eight-year real estate cycle and see the real estate business soft into 2009 and then we’ll see some stabilization,” he said, adding that the land bank is projecting a two percent decline in cash flow in 2008. The land bank receives two per cent transfer fee on most real estate transactions.
Ms. Purdy agrees with that time line. “I don’t think we’re at end of the cycle and election years are typically not kind to the real estate business. I don’t anticipate much change in 2008 and 2009 will see the market begin to turn, unless there is an unusual event.”
“This is a sorting time for buyers, sellers and for real estate professionals. The only bad thing about this is the outrageous subprime debacle,” she said, alluding to predatory mortgage lending across the nation to borrowers who couldn’t afford their loan payments.
By community, Edgartown home sales increased more than 14 per cent to 120, compared with 105, and its 15 land sales topped 13 land sales in 2006. Edgartown median home value rose $99,000, a 13.3 per cent increase to $862,000 from $747,000 in 2006.
Chilmark’s median home value rose more than $1 million to $2,849,000 compared with $1,814,000 a year earlier on sales of 23 homes compared with 20 in 2006.
West Tisbury’s median home price was unchanged at $946,000 in 2007 on 33 home sales compared with 40 sales in 2006.
Oak Bluffs fared worst among Island towns, as home sales slipped 29 per cent from 2006 and median value declined 9.8 per cent to $535,000 from $593,000.
Vineyard Haven home sales slumped 18 per cent to 64 from 78 in 2006. The median home transaction price dropped 7.4 per cent to $547,000 from 591,000 a year earlier.
Aquinnah median home price rose 13.4 per cent to $1,333,000 from $1,175,000 in 2006. Sales were unchanged at five in each year.