Home prices on Cape Cod are rising, even as some people remain out of work or have less income due to the pandemic.
The hot real estate market could put additional pressure on rentals and spur an eviction crisis, participants in a “State of Cape Cod” summit said on Thursday.
Forty percent of Cape Cod landlords who responded to a recent survey have a tenant who is behind on the rent, according to Alisa Magnotta, CEO of the Housing Assistance Corporation.
She said the combination of pandemic-related job losses and a booming real estate market could worsen the Cape’s affordability gap and potentially spur an eviction crisis.
Plus, year-round apartments could be lost if owners sell.
“You could see how a landlord would potentially want to just get out, and sell it into a hot market,” she said. “And then that home is used either for another year-round person or a seasonal rental, but it displaces somebody.”
Matt Pitta of The Davenport Companies moderated the online discussion.
He said evictions could create a “two-headed” crisis — renters with nowhere to live, and small landlords with no rental income to pay their mortgages.
A state moratorium on evictions and foreclosures expires Oct. 17. Gov. Charlie Baker initially paused evictions and foreclosures through mid August, but he later extended the order for 60 days. It’s unclear if Baker will take any additional action before the moratorium runs out.
Speakers at the summit said they do see a bright spot: the economic activity generated by more people making Cape Cod their year-round home. Because of the pandemic, more people are working remotely, giving them more choice about where they live.
Houses are selling fast. In the past, homes that sold within a few days were mainly priced under $450,000, but now it’s happening at all price levels, according to Ryan Castle, CEO of the Cape Cod & Islands Association of Realtors.
He said Cape Cod’s year-round economy could benefit, because many of those new residents will bring higher incomes from Boston, New York, or Connecticut.
“So they can spur more business,” he said.
Castle said he hopes that in the long run, though, the Cape will benefit not just from those dollars, but also from existing and new businesses innovating and adapting to the changing world.