January 2010

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January 2010 W I N D WA L K E R M A R K E T R E S E A R C H

One would never have known that it was the middle of winter on Nantucket this past weekend. Valentine’s Day brought in a slew of weekend visitors who were seen shopping on Main Street and filling the island’s restaurants. Real estate showings and summer rental inquiries kept many real estate offices busy and have provided a steady flow of business in recent weeks. So while January’s actual real estate closings may have been quiet, all signs point to a positive year ahead for island tourism and the real estate market. January activity brought in 9 closed sales totaling approximately $12.2 million, a 44 percent decrease from January 2009 and a 73 percent decline from the prior five year average as measured by dollar volume. While this represents a significant drop, it is not indicative of the current health of the market. Rather the decline appears to be largely due to the time of year and the numerous closings that occurred prior to and after January (the closings in December and those already recorded in February have surpassed prior year averages). Numerous properties went under agreement in January and there are currently over $60 million in pipeline sales. February is already shaping up to be a very successful month with $34 million in transactions through February 15, 2010, including a $19.2 million sale on Top Gale Lane.

Nantucket Monthly Real Estate Sales Volume vs. Previous 5-Year Average $120,000

in $000s

$100,000

$80,000

$60,000

$40,000

$20,000

– February ‘09

March ‘09

Monthly Sales

April ‘09

May ‘09

June ‘09

July ‘09

Previous 5-Year Average

August ‘09

September October November December January ‘09 ‘09 ‘09 ‘09 ‘10

While complete statistics are not always available for private transactions and foreclosures, the metrics reveal that while January’s sales are minimal, they are off to a healthy start. There were five single-family home sales, three of which were above $2 million, three land sales and one foreclosure sale (108 Somerset Road) in January. The average months on the market for all property types was 10 months, slightly better than the 2009 average of 11 months. The average sale price as a percentage of discount was 70 percent, slightly worse than the 75 percent average for 2009.

Date

Address

Original Price

Selling Price

Discount

Town

Type

Month on Market

01/14/2006

38 Orange Street

4,200,000

3,000,000

71%

Town

Single Family

3

01/11/2006

4 Quaker Road

2,995,000

2,800,000

93%

Town

Single Family

18

01/28/2010

138 Miacomet

2,695,000

2,050,000

76%

Miacomet

Single Family

14

01/27/2006

4 Cottage Avenue

1,695,000

950,000

56%

Sconset

Land

22

01/06/2006

11 New Mill Street

995,000

880,000

88%

Town

Single Family

6

01/14/2006

6 Packet Drive

1,250,000

845,000

68%

Sconset

Land

5

01/14/2010

6 Clifford Street

Private

801,000

—

Surfside

Land

—

01/12/2010

108 Somerset Roaa

Foreclosure

429,000

—

Miacomet

Single Family

—

01/14/2006

1 Hooper Farm Road

475,000

362,000

76%

Mid Island

Single Family

3

$1,016,217

70%

Average

10

With January behind us and spring just around the corner, what can we predict for the 2010 Nantucket real estate market? The high-end market, boosted by recent sales on Hulbert Avenue ($15 million) and Top Gale Lane ($19.2 million), will likely continue to see a sprinkle of activity as Wall Street bonuses make their way to the island and sellers move toward realistic pricing (recall the $55 million listing that came to market in the fall of 2008). Land sales should improve as opportunistic buyers recognize the value in this sector both with heavily discounted prices and reduced construction costs. Properties listed under $1 million will probably also see increased transaction activity (though not without significant discounting given this category represents 35 percent of current inventory) as first-time home buyers secure the tax credit and sellers are moved to reduce prices to attract the buyers who qualify for financing. The commercial sector is unlikely to materially improve as rents continue to fall, many storefronts remain vacant, and new retail tenants seem hard to come by (at least currently), making commercial returns minimal. This time last year we were all wondering what, if anything would happen in the real estate market. Though it may still be early, the 2010 Nantucket real estate market has started off on solid ground and buyers are once again dipping their toes in the water.

— Jennifer Shalley DIRECTOR OF RESEARCH FOR WINDWALKER REAL ESTATE

For more Windwalker research, please visit

www.windwalkerrealestate.com/research Date Source: LINK Nantucket, Nantucket Listing Service. Photography: tgolcott.com