Last week the Boston Globe reported “a rare bit of good news on the housing front — at least for vacationers” on Cape Cod: “renting at a reasonable rate might be a little more possible this year due to an uptick in availability.”
The article, by Beth Treffeisen, attempted to persuade readers that because so many people bought second homes here during the pandemic and were now offering them as short-term vacation rentals, prices would drop this year.
The Globe attributes this argument to Paul Niedzwiecki of the Cape Cod Chamber of Commerce: “Prices were unsustainable during 2021 and 2022, Niedzwiecki said, when people flocked to the Cape as a safe space during the pandemic, sending costs to rent a house for the week (or longer) soaring. They improved last year and will level off even more this summer.”
But if you read the article closely, you find that Niedzwiecki doesn’t actually say he thinks prices are coming down. “We had another really good year last year,” he says. “It will be another solid year.”
The only data on prices in the article contradict its central premise. Joan Talmadge of the rental agency WeNeedaVacation says bookings this year are up 3.4 percent, and prices are up 2 to 3 percent.
The article notes that short-term rental prices have increased because of new state and local taxes, but then says that “hasn’t really dented demand,” citing Luke Chapman of Del Mar Vacations in Orleans.
Chapman doesn’t like those taxes. “If your economy depends on tourism and you’re applying a sizable sin tax, you’re implying that you’re trying to dissuade that behavior, which I think is probably unwise,” he told the Globe.
It’s odd that Chapman uses the term “sin tax,” which is usually applied to taxes on things that are considered bad for you, like tobacco, alcohol, and gambling. He thinks the short-term rental business is a good thing. “A growing share of the people who own summer rentals are themselves Cape residents,” according to the article, “meaning the money generated by rentals is more likely to stay local, Chapman said.”
Chapman’s “growing share” argument is self-serving and probably untrue. In fact, a big chunk of the money from rentals is paying for mortgage interest, which most likely goes into the pockets of investors in mortgage-backed securities and doesn’t stay in the local economy.
There’s little doubt that the short-term rental boom on the Outer Cape is bad for people who live here. Year-round homes have become de facto motels, commercial properties whose value has increased because of a change of use — which may, based on a recent court decision, violate local zoning laws. (See Paul Benson’s story last week about that.)
Invisible in the Globe’s fawning air kiss to the industry is that this boom — an increase of 6,000 homes in three years, the article says — has made more and more people here homeless.
There’s an important story here, but it’s not the one the Boston Globe reported.
