Theresa Sammon and Brett Risser of Medford steeled themselves for an arduous search when they decided to look for a vacation property on Cape Cod, well aware of the bidding wars, escalating prices, and tight inventories in the Boston area’s frenzied real estate market.
But the married couple quickly found a two-bedroom cottage in Dennis Port, made an offer — without competition from other buyers — and bought it for $10,000 below the asking price of $265,000.
“We were pleasantly surprised,” said Sammon, the mother of two children and the owner of a pet spa in Somerville. “You could never touch a home like this for $255,000 in Medford or Somerville. No way.”
In contrast to the red-hot housing market that’s now spreading through Boston and close-in municipalities, there are still bargains to be had on Cape Cod and the Islands, which are heading into another summer still struggling to shake off effects of the last decade’s housing crash and subsequent recession. The recovery there has been slow and mixed, with single-family houses sitting on the market for an average of 170 days on the Cape, compared with the statewide average of 122 days and 82 for Greater Boston, according to data from the Massachusetts Association of Realtors.
Prices have regained their prerecession peak in only one community on the Cape and Islands, Edgartown on Martha’s Vineyard, according to data from the Warren Group, a real estate research firm in Boston. The median home price in Edgartown reached $801,500 last year, or 11.7 percent higher than the peak price in 2005.
In contrast, the median price on Nantucket, the exclusive summer resort for the uber-rich, was nearly 30 percent off the peak of $1.49 million in 2005, according to the data. Other places on the Cape were also well off their prerecession median highs: Hyannis (down 34 percent from a peak of $327,000), Oak Bluffs (down 25 percent from $595,000), and Yarmouth (down 20.4 percent from $327,000).
The region’s lagging housing recovery is the result of a real estate market driven largely by the sales of vacation and retirement homes, a market segment that needs an economy that is strong and stable enough for buyers to feel confident about taking on another mortgage, real estate agents said. That has been slow in coming.
“Not every Tom, Dick, and Harry is out there looking for a vacation home on the Cape,” said Timothy Warren, chief executive of the Warren Group. “When people start looking for vacation homes, that’s usually a sign that the second stage of an overall recovery is underway.”
There are signs the recovery is entering the second stage.
Median prices for single-family homes on the Cape nudged up by 0.6 percent in March to $327,000, compared with the same month last year, according to data from the Massachusetts Association of Realtors.
In the first three months of the year, Barnstable, Brewster, Centerville, Chatham, Cotuit, Harwich, Hyannis, Falmouth, Osterville, Provincetown, and Wellfleet all saw median prices rise, compared with the same period in 2013, according to the Warren Group.
In Osterville, the median single-family home price soared 42 percent; in Falmouth it jumped nearly 20 percent.
Annie Blatz, a real estate agent and manager of the Brewster and Yarmouth offices for Kinlingrover Real Estate, said that she is encouraged by recent sales in the $250,000 to $400,000 range, which suggest that middle-class buyers like Sammon and Risser feel more comfortable about buying a second home.
But like many other real estate agents, she expects it to take a few more years for Cape Cod to completely rebound from the housing bust.
“It’s slowly recovering and coming back,” she said, “but it hasn’t really been substantial and widespread.”
Municipalities such as Bourne, Mashpee, Dennis, Orleans, Sandwich, Truro, Yarmouth, and Oak Bluffs experienced year-over-year price declines for single-family homes in the first three months of the year. And the condominium market remains soft across the Cape; in March, the median condo price slipped 3.9 percent to $209,400 from a year earlier.
Paul Grover co-owns Robert Paul Properties in Osterville, which also has an office in the Back Bay. He said that business on the Cape is picking up, but it can’t compare to sales in the Boston area, where nearly every property that his firm lists sparks bidding wars and flies off the market.
On the Cape, he said, he has recently seen multiple offers on some properties, but they remain rare. Many properties sit unsold for months.
“The Cape is definitely a different bird,” he said. “The market here on the Cape is definitely slower.”