Bad news if you bought or built a new house on the Vineyard and figured you could cover some of your mortgage by renting it out for a chunk of summer: You weren't the only one with that idea. Now real estate agents say the market is glutted with houses for rent.
"There's a lot of houses out there to rent," said Deborah Hancock, a longtime real estate broker in Chilmark. "We have houses that have never been vacant that are still vacant . . . . It used to be that anything good was gone by January."
In a real estate market dominated by second-home purchasers, the sales of houses and the construction of new ones appear to be driving the summer rental scene.
"Every new house on the Island is by my reckoning a new rental," said John Best, a Realtor in Vineyard Haven.
Ms. Hancock agreed the connection is clear.
"The bulk of people who buy count on a significant amount of rent coming out of that house," she said. "Tons of real estate was sold in the last few years . . . . A lot of people want to know, ‘What can I get for rent?' Some brokers tell them lower. Others tend to go in the opposite direction. But if somebody told you five years ago, you could get $5,000 a week, you don't want to hear about $3,500 a week."
The bottom line, most real estate brokers say, is that the summer rental market this year is soft. "It's very similar to last season, which was the worst I've seen in 14 years," said Skip Dostal at Martha's Vineyard Home Rentals in Edgartown.
Some people in the seasonal real estate business blame the Steamship Authority, saying it's just too hard to nail down a ferry reservation. Others say would-be visitors are waiting until the last minute in hopes of snapping up a bargain.
But Patty Kendall, coowner of Kendall & Kendall Real Estate in Vineyard Haven, isn't convinced that fewer people are coming to the Vineyard.
"I seem to have as many rentals booked as last year, but there are still houses that aren't getting booked or aren't booked in full," she said this week.
The inventory of houses available for rent has doubled in the last three years, she added. How many houses are still left unrented? It's a hard number to pin down. Friday's Gazette listed 146 houses for rent between now and September.
Beaumont Martin of Baltimore, Md., is still trying to rent her house in the Hidden Cove development on Sengekontacket Pond in Oak Bluffs. "It's definitely been slower," she said in a telephone interview. "We still have two weeks in July and three weeks in August left."
A four-bedroom house on Seaview avenue in Oak Bluffs is rented out for only three weeks this season, said owner Ed Gray of Chevy Chase, Md.
"We're not getting as many calls," he said yesterday by telephone. The house rents for $5,500 a week in July and August and $4,000 a week in June.
Bill Ferris in Springfield is trying to fill two weeks in July and the first week in August for his waterfront, five-bedroom house in Oak Bluffs. "I can't believe it myself - and I have ferry tickets."
Ms. Hancock is still shocked that a house in Spring Point in Chilmark - with water view and private beach access for $5,000 a week - is only taken for one week in August.
Brokers easily rattle off such examples. Mr. Best is still scratching his head about the house with frontage on Squibnocket in Chilmark for $8,500 a week. "Seems to be a reasonable price, but it's wide open for August," he said.
Ms. Hancock believes that some homeowners will buckle under the pressure and lower their rates. "Probably half of them will break down and say, ‘I'll take what I can get,' " she said. Just how great is the economic pressure on some homeowners to generate rental income this summer? Hard to gauge, but Ms. Hancock said the bulk of homebuyers who bought a property for under $1 million needed a mortgage to pay for it.
"Let's hope they didn't get too big a mortgage," she said. "Still, I haven't seen anyone in a situation where I've got to rent my house or I'm going to lose it. People would just be far more comfortable if they could rent it."
Mr. Best pointed out that property taxes are also forcing some homeowners to add their houses into the summer rental inventory. "Taxes on nice properties have skyrocketed, and those people are renting more," he said.
But while new economic realities are bearing down on the people holding a mortgage or a deed for a second house on the Vineyard, the demands from the consumer are also changing.
Renters - those people who will pay anywhere from $5,000 to $20,000 a week for a house - are savvy and demanding, said Ms. Kendall.
"Renters don't want the super campy look anymore," she said. "They may not need a Jacuzzi but they don't want shabby. If people want to rent their houses, they need to keep the place up. They have to keep up with the competition now."
Brokers also concur that it's become increasingly difficult to close the rental deal, to get renters to sign a contract. "I've had two or three tenants cancelling," said Mr. Dostal.
"There are so many options, so many different real estate offices, people advertising on their own, hundreds of houses on the 'net," said Ms. Hancock. "We're having trouble getting people to commit to a rental."
The other shift on the consumer side of the equation is that many of the renters from years past are now homeowners.
"Peope who have been excellent tenants, who rented at the high rate of $30,000 to $50,000 a month, have purchased properties," said Ms. Kendall. "You lost that other end of the see-saw."
Not all brokers are seeing trouble. Ann Floyd at Sandcastle Realty, which specializes in summer rentals, said, "The bulk of our rentals are done, and we're extraordinarily busy."
"Last year was the best year I ever had, and this year is on a par for us," she added.
And contrary to the trend described by Ms. Hancock and Mr. Best about people buying and immediately adding their homes to the stock of summer rentals, the upscale, multi million dollar sales represent homes coming off the rental market.
"The high-end house people are not renting out their house, and so there's still a demand for [renting] beautiful, luxury waterfront homes," said Ms. Kendall.
And as beautiful as the Vineyard is in the summer months, some vacationers may be opting for destinations that are cheaper and less complicated.
Even Ms. Hancock, who is in the business of selling the dream of a Vineyard summer vacation, said she can see the logic behind one of those all-inclusive resorts in the Caribbean or checking out Maine. "People might be going to Europe or getting a better deal on a house elsewhere without the same hassle as coming here," she said. "If you can't afford to fly, it's hard to get here."
Even the classified pages in the Gazette offer vacationers at least one alternative. Right after those 146 ads for a summer week on the Island, there's one little notice under real estate for rent, Off-Island: an apartment in Paris for about $600 a week and a house in the Loire Valley for just under a $1,000 a week.
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