Cash is king, and according to some market experts, it’s driving up Vineyard real estate prices.

With cash buyers entering the Island property market at an above-average rate, industry experts say it’s both a symptom of rising prices and a major force behind it.

According to LINK, a real estate database serving Martha’s Vineyard, Nantucket and Boston, 41 per cent of all Island real estate purchases from May 2025 through April 2026 were made in cash. On properties over $5 million, that number rose to 72 per cent.

LINK president Debra Taylor said this number eclipses the typical number of cash buyers in other markets, which tends to hover between 10 and 20 per cent of all purchases.

Cash purchases account for 72 per cent of homes $5 million and above. — Ray Ewing

“One of the reasons vacation markets have become so expensive is because of the impact of cash buyers,” she told the Gazette.

“It’s cyclical,” Ms. Taylor added. “I would say this is probably a phenomenon that’s been quietly taking place over the last 10 years.”

Cash buyers are attractive to sellers because they are immune to all kinds of obstacles faced by buyers financing their home through a lender. Cash buyers can close quickly, often waive home inspections, and can purchase a property for whatever they are willing to pay, even if it’s more than the property is technically worth.

“[A lender] is not going to lend me $5 million on a property that’s only worth $2 million, because their asset wouldn’t necessarily be secured,” Ms. Taylor said of the phenomenon.

But for a buyer planning to take out a mortgage, their lender will generally require an inspection and will want to agree to a price that they deem fair — a number determined by assessed value, market behavior and other factors.

“When there’s that type of financial freedom, that contributes significantly to a huge run-up in prices,” Ms. Taylor said.

Though almost half of all property purchases were made with cash over the past year, the numbers varied significantly when broken down by town. Chilmark had the highest proportion of cash purchases at 67 per cent, followed by Aquinnah at exactly 50 per cent. On the lower end were Vineyard Haven at 35 per cent and Oak Bluffs at 27 per cent — figures somewhat closer to what Ms. Taylor says she would expect from the average mainland suburb.

She said the variance is due to the kinds of properties that tend to be available in each town. Chilmark and Aquinnah’s large, expensive properties mean they attract buyers more likely to have the cash to pay upfront.

Pauline Donnelly, principal broker and owner at the real estate sales firm Donnelly and Co., said that while the power of cash purchases endures in any real estate market, the Island’s big-ticket property augments its effects.

“I would say it’s really a function of the price points of the properties,” she said. “People who can afford multi-million-dollar properties tend to have cash, and they’re not financing when interest rates are low.”

Ms. Donnelly said that because the Island real estate market is driven largely by second-home buyers, most Island buyers have the freedom and flexibility to wait for the right property and jump on it. Because they’re less likely to need to finance, they’re less likely to care about interest rates, which gives them purchasing power over buyers who need to finance.

“When we represent a seller and there’s more than one offer on the property, one of the offers has a financing contingency... the cash offer is always the stronger offer for the seller,” she said.

With the Vineyard’s market conditions drawing a relatively high number of cash buyers, this phenomenon does not bode well for first-time home buyers or anyone trying to buy a Vineyard home on a budget, says Ms. Taylor.

“The other piece of this equation is that developers or investment buyers are also paying cash for entry level homes... buying something under $2 million, tearing the house down, and putting up a $5 million home,” she said.

“It transcends every segment of the market,” she added.

Leslie Floyd, principal broker and owner at Portfolio Properties in Edgartown, said that the cash purchase boom was particularly strong during the pandemic, when buyers were eager to place a premium on an escape from the mainland. In her experience, it has since cooled off some.

“A lot of these people actually end up financing after the fact or financing before closing,” she added.

But she also echoed the idea that cash buyers are hard to beat, especially when many of them are buying investment properties.

“I do believe that people will park their money in real estate here, as opposed to keeping it in funds that may not be performing,” she said.

Some in the industry are taking measures to help buyers who need to take out a mortgage remain competitive with cash buyers.

Meryl Watson, a lender at Leader Bank, said one tool her bank offers is called a purchase pass, which gives buyers a full commitment for a loan in-hand before they make an offer on a home.

“It’s almost like a cash offer, because it can’t fall apart, really,” she said. “The only unknown is the appraisal.”

Ms. Watson said that she isn’t as convinced as some of her peers in real estate that cash buyers are driving the Vineyard market. She said interest rates shouldn’t be overlooked as a driving factor, and that her office does more business when rates are low.

“I think there’s a nuance there,” she said.