In a normal year, the picturesque Cape Cod village of Osterville would see around 125 home listings at any given time. Now, they have around 14. Cape Cod, according to real estate and mortgage professionals based there, is experiencing the same low inventory and high demand dynamics as most of the US housing market, just turned up to 11. Houses go with multiple offers, long-term rentals are almost impossible to find, seasonal rentals on AirBnB are already booked up for most of the rest of the year. There’s even something of a ‘black market’ emerging for Cape Cod real estate.
Annmarie Edwards (pictured below), branch manager at CrossCountry Mortgage in Cape Cod, and Ellen Valentgas (pictured above), a Cape Cod based real estate agent with Sotheby’s, explained the situation in their local market. They laid out how a combination of telecommuting and lifestyle-driven decisions among homebuyers have produced such a hot market. They highlighted, too, how the ‘black market’ for real estate has taken shape and talked through how they keep clients happy in these environments.
“I have a friend, for example, who was a real estate agent in Boston, and her family decided that they wanted to live a simpler life,” Edwards said. “So, they sold their house and they’re buying one in Cape Cod now that will probably go a few hundred thousand dollars above the asking price. They had to remove all contingencies in order to secure that house, and they’re doing it because they wanted to live here, to go back to basics.”
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Valentgas agreed, noting she’s seen a range of clients with a similar experience. While people are leaving cities for the cape, she noted that fewer are doing it for fear of COVID, and more are doing it to seek a lifestyle year-round. Access to water and natural beauty is motivating this migration among a buying class that Valentgas describes as “passionate.” The short-term rental investors, at the same time, are flocking more to multifamily developments and condos. That market is still strong, but on the single-family residential side Valentgas and Edwards are both seeing huge growth among buyers who want to live there.
In the face of all that competition, both experts agreed that pre-screening and qualification of clients is key. As is speed of movement. If a house gets listed that the client wants, the agent and mortgage pro both need to be able to put offers together in a matter of hours. Valentgas wants her buyers to be “the first ones in the door” and Edwards works closely with clients upfront to pin down both what they’re qualified for, and what they’re actually willing to pay on a monthly basis. Of course, speed when a listing shows up can be circumvented altogether these days.
The ‘black market’ for Cape Cod real estate, as Edwards and Valentgas called it somewhat tongue in cheek, refers to the fact that sales are far simpler to negotiate before the property is even listed. Mortgage pros and real estate agents alike are working their networks closely these days, trying to find out who is willing to sell so they can capture the best deal for all parties without going through the rigamarole of listing. Referrals and personal connections are making all the difference as this market keeps accelerating.
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Despite the breakneck pace, neither Edwards nor Valentgas expect things to slow down within the year. Even in 2022, they expect the market will remain strong, though it may become a little less frenetic by then. As both real estate agents and mortgage professionals face markets of a similar nature throughout the country, Valentgas explained that they need to take a reasonable, diligent, and solution-focused approach to each of their client interactions.
“You have to be a good listener, you have to really understand what your client is looking for,” Valentgas said. “You have to work well with other agents and mortgage partners to make sure you don’t create problems. If a problem does come across your desk, it’s not a problem, it’s something to be fixed…When there are bumps in the road that agents or mortgage professionals face, we shouldn’t point fingers at one another. The sellers and buyer shouldn’t know about those issues because it’s between us as professionals.”