Martha's Vineyard Real Estate Market Update is a service offererd by Tea Lane Associates. Tea Lane Associates updates Martha's Vineyard real estate sales transactions on a weekly basis and posts reports and charts throughout the year for your review, including info on all homes and land sales on the island. Please let us know if you have any questions or would like more detailed analysis for properties in a specific town or price range. We have much more information to share with you on the Martha's Vineyard Real Estate market.
2015 Martha's Vineyard Real Estate Market Review
After three flat and stable years from 2012 to 2014, the real estate market on Martha’s Vineyard surged in 2015. Compared to 2014, the number of properties sold in 2015 increased 17% to 602, total dollar volume increased a whopping 39% to $675mm, and the average sales price rose 19% to $1,122,000.
The 2015 real estate market on the island broke records for total dollar volume and for high end sales over $10mm. There were 7 sales over $10mm, the most ever recorded, which outpaced the peak year of 2006 which saw 6 sales in this category. However, high end sales are not the only driver for the gains of 2015. This market was strong even without the uber high end segment. There were 88 more transactions in 2015 than in 2014 and if you take out the high end sales over $5mm, total dollar volume still grew 19% and number of transactions increased 16%. The Vineyard, being a vacation destination and second-home market, typically has a different experience than primary home markets, and is slower to react to national trends. Last year we reported a surge of activity in some primary real estate markets around the country that the Vineyard had not yet experienced, but 2015 was the year it caught up to us.
After three years of prices remaining flat, the sales surge of 2015 combined with the reduction of inventory may cause the market to begin shifting toward a seller’s market. For the first time in ten years, the peak inventory level in 2015 was lower than the number of properties sold that year.
While the above statistics include all transactions and represent island-wide performance, individual towns and market segments reveal different dynamics in 2015. Martha’s Vineyard is an island with six towns, each with its own character and specific market conditions. Within each town there are different niches as well…waterfront, water view, high-end, mid-range, entry level and commercial properties. Because each of these market segments can be, on its own, very small, generalizing trends or making broad statements is difficult.
Chilmark had a solid year and remained flat in the number of transactions (37 in 2014 and 2015) while high end sales pushed the total dollar volume up 23% (from $55mm in 2014 to $68mm in 2015) and average price increased similarly 23% (from $1.49mm in 2014 to $1.83mm in 2015). 2015 saw the return of Chilmark’s high-end market (over $3.0mm). There were 7 sales over $3mm in 2015 versus only 2 sales in both 2014 and 2013 in this category. This small high end market is driven by unique properties where just a few sales make an impact.
The Aquinnah market slowed in 2015 after its own surge in 2014 and returned to “normal” levels for the smallest town on the island. The number of transactions decreased 37% from 19 in 2014 to 12 in 2015 (2012 and 2013 had 12 and 11 sales respectively). In this small market, one sale can make a huge difference in market performance. Due to the record-breaking sale described below, the total dollar volume in Aquinnah in 2015 only fell 6% from $19.3mm in 2014 to $18.2mm in 2015 and average price in Aquinnah rose 49% to $1.51mm (from $1.02MM in 2014).
In 2015, the Homefree Partnership property on Skipper’s View Lane, an exceptional 4-acre waterfront property with private beach, high-end house, guesthouse, and beautiful gardens and grounds, sold for $6.5mm. This sets a new high for real estate transactions in this remote, western-most town on Martha's Vineyard. The previous highest priced property sale was 14 Moshup Trail which sold in July 2009 for $3,600,000 and was combined with a $400,000 beach lot for a total of $4,000,000. The house at 14 Moshup was rebuilt after this purchase. This level of investment is somewhat new for the town, but not isolated. Several other property owners in the area are invested in this range. Skippers View just happened to be the first to sell.
West Tisbury had a strong year and experienced a 21% increase in the number of transactions from 48 in 2014 to 58 in 2015. Total dollar volume rose 40% (from $39mm in 2014 to $55mm in 2015). There was a 15.6% increase in average price (from $820k in 2014 to $948k in 2015). The better performance in dollar volume can be attributed to one large sale of $10.85mm. Otherwise, the growth came from the lower end of the market under $1mm. There were 12 sales over $1mm in 2015 compared to 11 in 2014 but there were 46 sales under $1mm in 2015 compared to 37 in 2014.
The three down-island towns of Vineyard Haven, Edgartown and Oak Bluffs experienced mixed results in 2015.
Edgartown surged more than any other town on the island in 2015 with an increase of 57% in the number of transactions (from 148 in 2014 to 233 in 2015) and 86% increase in total dollar volume (from $191mm in 2014 to $356mm in 2015) resulting in an increase of 18% in the average price from $1.29mm in 2014 to $1.53mm in 2015. The growth in dollar volume in Edgartown represents 87% of the overall increase of dollar volume on the island as a whole in 2015. This dramatic uptick is the result of a strong performance in all sectors in Edgartown but the most impactful to dollar volume were the 5 sales over $10mm (three of which were over $20mm) including the record setting highest priced sale of a private residence on Martha’s Vineyard of $24.75mm. The record breaking sale in Edgartown was a compound on the South Shore on over 10 acres with 9 bedrooms, pool, gardens and direct access to the ocean.
Edgartown has the most expansive price range of all the towns, from some of the island’s lowest priced properties to the island’s most expensive properties. Edgartown’s lower end market under $1mm saw 149 sales in 2015 versus 95 in 2014 and the mid-range segment of $1-3mm saw 63 sales in 2015 versus 40 in 2014. Overall, the entire range of Edgartown properties experienced heavy activity in 2015.
Vineyard Haven had a 16% increase in the number of transactions from 104 in 2014 to 121 in 2015 but only an increase in dollar volume of 4% from $92mm in 2014 to $96mm in 2015, which drove down average price by 10% from $881k in 2014 to $790k in 2015. The increase in transactions was concentrated on the lower end of the market under $1mm where there were 102 sales in 2015 versus 78 in 2014. The high end over $3mm slowed to 2 sales in 2015 versus 6 over $3mm in 2014.
While Vineyard Haven has mixed results with a stronger lower end of the market and weaker high-end, Oak Bluffs had the opposite experience. The number of transactions in Oak Bluffs dropped 11% from 2014 to 2015 (from 158 in 2014 to 141 in 2015) and an 8% decrease in total dollar volume (from $90mm in 2014 to $83mm in 2015) but the average price rose 3.5% from $568k in 2014 to $588k in 2015. The rise in average price was due in most part to the $1-2mm segment of the market which almost doubled from 6 sales in 2014 to 11 in 2015. It is worth noting that 2014 was an extremely strong year for Oak Bluffs and the overall performance in 2015, although slower than 2014, keeps the town’s pace well ahead of 2012 and 2013 numbers.
Entry Level Sales
2015 was a strong year for the island’s real estate market but it did not get more difficult to enter the market given that there were more sales under $1mm than in any year in the past decade (since 2004). 2015 had 446 sales under $1mm, 61 more than in 2014. Since 2008, foreclosures have had a major impact on the number of sales under $1mm but fortunately the number of foreclosures dropped dramatically in 2013 (down 53% from 58 in 2012 to 27 foreclosures in 2013) and again in 2014 with the number dropping to just 15, where it held for 2015 (15 foreclosure sales in 2015). Therefore, like in 2014 it was natural market forces, not foreclosure sale pricing, that made an easier entry into the market in 2015.
This report has covered the record breaking sales over $10mm in 2015 but it should also be noted that the entire high end over $3mm set a record in 2015. There were 36 sales over $3mm on the island in 2015 which is the highest number of sales in this segment since 2003 when we starting tracking this data. The last peak years of 2006 and 2007 saw 34 and 33 sales in this segment respectively but, since then the market dropped to 15 as the low in 2011.
The sale of commercial properties slowed in 2015 to 16 transactions (down from 22 transactions in 2014). The largest commercial real estate transaction in 2014 was the sale of 20 South Summer Street in Edgartown for $2.55mm. This space was transformed into Rosewater Market and Take-Away by the summer season.
After three years of stability, some growth was expected in 2015, but the overall performance of the Martha’s Vineyard real estate market soared past anyone’s expectations. The results were so strong that the question of sustainability arises. We expected slow and modest growth, not this dramatic jump. At closer analysis, with the exception of Edgartown, most of the island showed steady, unassertive growth overall which indicates that most of the activity we saw this year should be sustainable. Edgartown however will be hard pressed to keep its aggressive pace through 2016, but even a moderate slowing would still create a healthy outcome for the town.
National and world events will continue to affect our local economy, for good or bad. With the upcoming presidential election and the financial and security issues around the world, there is never any certainty what will happen in the year to come. But the Martha’s Vineyard real estate market has a solid historical track record and the draw to the slower, quieter, simpler life the island offers may be stronger than ever. Given the positive results of 2015, we remain optimistic about the year ahead for buyers and sellers alike.
Tea Lane 2015 Year-End Highlights
- Tea Lane Associates' sales represented 27% of all up-island sales dollar volume, and 9% of dollar volume island-wide.
- Tea Lane Associates' was involved in 43% of Chilmark transactions. Tea Lane Associates was involved in 50% of transactions over $1mm in Chilmark. Tea Lane Associates sold the highest price home in Chilmark that was listed on the market.
- Tea Lane Associates sold the record-setting highest price property in Aquinnah at $6,500,000.
- Tea Lane Associates sold property in 5 of the 6 island towns in 2015 ranging from $262,500 for a vacant parcel in Vineyard Haven to $14,450,000 for an estate in Edgartown.