Somewhere along the lines, I predicted the spectacular Nantucket speculation builders were going to do very well this summer. Let’s see how my prediction played out.
There are currently 16 spec. houses under agreement and 31 available. So, the percentage of total number of spec. houses that are under agreement, 16, compared to the total supply (under agreement and available), 47, is 34%. Now, let’s compare that to how non-spec. houses are doing relative to total, non-spec. supply. There are currently 69 non-spec. houses under agreement and 413 non-spec. houses available. So, 69 divided by total supply of 482 equals 14%. Whoa – that’s a big spread…
How about for the sold spec. vs. non. spec.? If we say total supply this year equals sold plus under contract plus available, then the percentage of spec. houses that have sold, 19, compared to total supply, 66, is 29%. Now, let’s take the same comparison for non-spec. houses. 193 sold divided by total supply of 675 equals 29%. Interesting…
So, why such a spread between the two groups of under agreement and no spread between what has sold? Simple, many of the spec. houses were not done until part way into the summer, so the winter and spring buyers did not buy them.
Having lots of the spec. inventory getting cleared further helps the market because then the spec. builders need to buy something else to build for the 2014 market. Selling creates selling.