Building Remained Strong in Chatham In 2023 Despite Drop In New Home Permits And Sales

CHATHAM – As the value of property continues to climb, more owners are opting to renovate or add on to their homes, according to figures released by the town.

The number of permits for renovations and additions remained almost even with 2022 while the number of new home permits dropped. There were also fewer single-family homes and condominiums sold in town during 2023, pointing to a cooling down of the previously red-hot real estate market.

The overall valuation of the town, as calculated by the assessing department, increased last year by 17 percent, from $9.9 billion to $11.6 billion. That increase “has enhanced the economic feasibility of upgrading existing homes throughout the town,” Town Manager Jill Goldsmith wrote in her recent fiscal 2025 budget message. The trend not only includes desirable, higher value areas like waterfront property but the entire community, she added.

Overall, housing values and the total value of building permits were up.

“While some of this increase in housing values can be attributed to inflation and increases in the cost of construction materials, this increase is indicative of a strong market demand for housing in Chatham and the type of homes being constructed,” Goldsmith wrote.

The average single-family home in town is now valued at $1,580,090, according to town figures.

Last year saw 25 permits issued for new homes, two fewer than in 2022. That’s down significantly from 2021, when 47 new home permits were issued. The average construction value of new homes in 2023 was also down at $867,758 compared to $1,195,541 in 2022.

Fewer demolition permits were issued last year, 19 compared to 22 in 2022.

Permits for residential renovations and additions numbered 957 last year, a slight decrease from the 961 permits issued in 2022. That was down from a recent high of 1,007 in 2021.

An increase in permits for alterations to existing commercial buildings — from 48 in 2022 to 66 – contributed to a slight boost in the overall number of building permits issued last year. The total number of permits issued was 1,077 last year compared to 1,060 in 2022.

The value of those permits was up by 5.6 percent at $98,080 versus $92,889,067 in 2022. The number was considerably lower than the $107 million record for construction permit values in 2021. The increase meant a slight jump in revenue from permit fees, as well a projection of additional tax revenue of $400,000 due to the new growth the permits represent.

Home sales in Chatham last year were down nearly 20 percent from 2022. According to the Cape and Islands association of realtors, 126 sales closed last year compared to 157 in 2022. The median sales price was also down, although slightly less, from $1,350,000 in 2022 to $1,312,500 in 2023, a 2.8 percent drop.

The number of condo sales was up, however, with 27 sold last year compared to 20 in 2022. The median condo sale price was down, coming in at $479,000 in 2023, 11.7 percent lower than 2022’s $542,500.

The number of new listings last year for single-family homes was down 14.8 percent, while the number of new condos on the market was up 24 percent at 31. The lack of inventory continued to impact the market, with only two new listings of single-family homes in December compared to five in December 2022. Homes were also spending more time on the market, 106 days in December compared to 62 the previous December.