By MARO V. TITUS
Everyone imagines or drives by what they consider their “dream house.” What really makes luxury homes special and are they immune to the conditions currently pushing market boundaries? Focusing less on the price tag and more on what’s trending vis-à-vis design, market, and owners, we will see that while the checks at closing are weighed down with more “0s,” there are both similar and unique impacts to luxury properties.
Bungalow, Monument Beach
Built in 1864 and known as ‘America’s First Bungalow,” this spacious panorama at 96 Rocky Point Road in Bourne last sold for $2.2M in 2020. Speaking with Matina Heisler, the listing agent at the time, she refers to it as a “sunset, sandy beach antique that we were hoping would be saved.” Heisler, who is one-third of the Kenny-Heisler Team within Kinlin Grover Compass Real Estate, is passionate about the preservation of olde Cape Cod. She speaks of selling the “story” of a home, not just the west-facing, private sandy beach aspects that will lead to a close. The home at 96 Rocky Point is history embodied in an address. Designed by Boston architect William Gibbons Preston as a Stick-style bungalow, it was built by Alpheus H. Hardy, a commissioner of the Cape Cod Canal who subsequently resided there.
With a mix of joke and earnestness, she refers to a $1M property as entry level in this sphere: no waterfront, no renovations. When asked about other buying considerations, she noted that renovations of these properties can be more expensive than a comparably sized new construction. “People are looking for a big structure,” she said. “We’re seeing some of the neighborhoods with one+-acre-sized lots commanding higher price tags for people to build their dream homes.” Ms. Heisler notes that with these properties, there is little turnover, with several generations retaining the heirloom family summer home.
“I think we haven’t seen some of the big-ticket properties come up for sale yet.” When those tickets appear, there are firms that deal exclusively in this market, with a network of buyers to access. Stewart Young of LandVest Real Estate (an affiliate of Christie’s International Real Estate) is well-versed in the factors that uniquely impact the high-end real estate market, particularly on the Cape.
Many second-home buyers during the last two years seeking high-end real estate are looking for an ideal work-from-home environment. These buyers want a second primary residence and are looking for homes with suitable office space and at-home gyms, with the ability to drive into Boston and surrounding suburbs when needed. Not surprisingly, “quality internet becomes a factor,” Mr. Young notes. Perhaps that is not the first thought when someone considers the $22M property at 314 Quissett Avenue in Woods Hole. Nor would this historic, highest-priced listing in Falmouth history be tagged as a “fixer-upper,” but like any aging estate, renovations will be needed.
What special factors go into the marketing of these types of homes? Investment in presentation is more significant, as is a reliance on a personal network within this small realm of buyers, to make a sale. Like Ms. Heisler, Mr. Young also believes history sells—“high end properties tend to have lots of interesting stories about them. Telling the story of a property is particularly important.” These are not typically a “list Thursday, sell Monday” exchange. However, while breathtaking vistas, like that found at 8 Wigwam Road in West Falmouth, may have more than 300 days on the market, even these price tags are moving quicker, often without hitting the sale rack. Young says those seeking a second primary residence tend to be younger. He also credits what he calls the climate change refugees—those migrating from other parts of the country in hopes of escaping property-altering hurricanes and tornadoes—as expanding the buyer population. He notes that a related priority of this buyer category is guest space; many are looking for in-law suites and guest houses as part of the estate.
As The Tides Turn
When considering a multimillion-dollar waterfront property, factors like sea level become a question in the value and insurability of the property. The Cape has experienced 11 inches of sea rise since 1922, and scientists estimate this trend will continue, with an additional 18 to 36 inches of sea rise by the year 2050. This places waterfront buyers at risk for a property becoming unsellable, as it could be destroyed within the next 10-50 years. An example of this is a home overlooking Ballston Beach in Truro, wherein previous storms have eroded more than 20 feet of dune beneath it, necessitating the house be physically move. “This is the sad part of the story,” says Young, citing the COVID pandemic and climate change, as two big trends impacting buyers and owners of luxury waterfront homes. “Many of the best properties on the Cape go back to the early 1900s. Those are the ones that are aging and will be tear-downs or renovations,” said Young.
A Builder’s Perspective
Builders can come to the rescue, restoring beauty and adding modern conveniences to some of the Cape’s most enviable homes. Mr. Young noted that move-in ready properties are a high priority with these buyers. Whereas a lack of inventory should drive sales of fixer-uppers, the pervasive lack of resources, cost of materials and depleted labor force are shifting priorities. Michael Duffany agrees. The Home Builders and Remodelers Association of Massachusetts has repeatedly honored the founder and owner of M. Duffany Builders as “legendary.” Yet even legends must wait patiently three or more months for European tile to arrive!
Duffany and his team have been collaborating with their clients to secure as many decisions as possible before a project begins. Michael’s son Todd, who, along with his brother Tim, represent the future of this thriving company, explains that “making sure expectations are aligned and keeping to budgets, is the biggest challenge, as availability [of materials] is so volatile.” Workforce scarcity, particularly on the islands, continues to be a concern. Augmenting these well-known obstacles, are the structural requirements and code-driven issues unique to waterfront homes.
Waterfront Crystal Ball – Future Trends
At the end of May 2022, there were 95 properties at, or above, $1,000,000 on the market throughout the Upper Cape. This represents 53 percent of the total available inventory at the time (180 properties). While inventory in these four towns remains low overall, the quest for lavish living is less elusive. According to a recent article by investment advisors at The Motley Fool, there are five trends likely to continue in this end of the real estate market:
1. Privacy
2. Expansive Views and Inverted Floorplans (putting living areas on higher floors to optimize the views)
3. Two Kitchens (including outdoor pizza ovens and full-service bars)
4. Opportunities to Expand
5.White-box Listings (leaving rooms empty instead of staging them)
“We always look at something beyond our comfort zone as a challenge,” says Mike Duffany, who remains ever enthusiastic about his work, citing the “the satisfaction of helping someone achieve a dream” as the motivation to prevail. With numerous repeat clients, M. Duffany Builders has worked on historical homes throughout the Cape as well as created some of the most picturesque new construction around.