Massachusetts Governor Baker recently signed into law a change to the taxable nature of short term rentals. This affects many of the property owners on Cape Cod who rent for less than 31 days in the summer months. Some relevant information can be found on the [...]
Short term rental tax
Are sharks really taking a bite out of the Cape Cod summer rental market?
The Boston Globe published an article on July 28th 2019 by Stephanie Ebbert, Cape Cod rentals are having an unexpectedly slow summer. As a quick synopsis the article states that summer vacation rentals are not filling up this year and hotels are down 5% (the data goes through May 31st only). The article posits several explanations including the new short-term rental tax, increasing shark populations around the Cape, lousy Spring weather, and larger market and economic trends.
Our take on this matter: sharks and overall market conditions have been gradually applying pressure on the rental market for years: the sharks were here last year and the year before and some anecdotal evidence suggests they may be an attraction for some tourists. The main culprit of the precipitous decline in bookings in 2019 is the new 12.45-14.45% rental tax. Given the evidence that rentals are down across the state indicates this is not an issue solely on Cape Cod. When a vacationer rents for $3000/wk the tax adds around $400, depending on the town. Couple this with what may be the indications of a slowing economy and people may be spending their money closer to home this year and waiting to see how much certainty the future holds for their pocketbooks.
If you are getting sick of renting but still want to visit the Cape, give us a call about buying. Then every season can be beach season!
Vacation rentals on Cape Cod have been undergoing significant changes in the past 9 months. Here is a quick update on the recent developments. For more information we encourage you to visit the [...]