More summer cottages and beach homes are available for rental this summer in South County than in the past. The buyer’s market is forcing some rental property owners to lower prices or lose out on a mainstay of South County’s seasonal economy.
The renter’s market is the result of fewer people looking to lease summer properties in South County this summer, at the same time as the number of rental homes on the market has increased, according to people in South County’s seasonal-rental real estate industry.
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At Coleman Realtors’ Watch Hill office, summer rentals are down approximately 10 percent this summer from last, said office manager Robert Richins. At the same time, the realty office has 25 percent more properties in Watch Hill and Weekapaug available for rent this summer than last summer, he said.
“Basically, the summer rental business is off,” Richins said.
Several Realtors in Narragansett, Charlestown, South Kingstown and other towns in South County said their summer rental numbers are similarly down and echoed Richins’ assessment of the season.
The decline in summer rental activity continues a trend begun last summer, and is being caused by a combination of factors, the Realtors said.
Rental of summer properties are down in part because of this year’s severe winter and mild spring, Realtors said. While some people who rent summer properties book as early as the previous fall or as late as May, the vast majority of summer rentals are booked in the winter and early spring. Booking of summer rental properties historically declines when the weather is unseasonably cold during those prime booking months, they said.
At Durkin Cottage Realty, which rents more than 200 summer properties in Narragansett, rental activity for July is up 50 percent from last month and more closely resembles past summers, owner James Durkin said.
“We missed that whole June market,” Durkin said. “Last year and this year, it seems like the spring never sprung. Winter went straight into summer, and that hurts us a lot. It’s like skiing – if there’s no snow on the ground here, people just think there’s no snow up north.”
Summer rental activity is also being squeezed by other sectors of the leisure industry, according to Cecile Cohen, manager of Randall Realtors GMAC’s Charlestown office. Some people who have rented a property in South County in past summers are taking advantage of lower airfares and other summer vacation travel packages to do something different this summer, Cohen said. In many cases, it’s now cheaper to take a cruise for a week than to rent a beach house, she said.
At the same time that demand has decreased, the supply of properties available for rental has increased this summer, Realtors said. More houses are on the rental market in South County than in past summers, as many people who used to rent have bought their own beach properties amid a torrid real estate prospecting market.
“A lot of people who used to be a renter are now on the other side as a rental owner,” Cohen said. “There’s a lot more supply and the demand hasn’t increased. There are more houses available but not as many renters available to fill those houses.”
An increased number of property owners in South County are now trying to rent out their homes in the summer to help pay for sharp property tax increases in recent years, Richins said.
Many homeowners who have failed to rent their properties on their own have enlisted help from a real estate agent in recent weeks, according to several Realtors.
It is unclear how the glut of available properties is affecting prices. At Coleman Realtors’ Watch Hill office, which rents homes at the high end of the market, prices for a one-month rental are nominally higher than they were last year, Richins said. The office does not rent for shorter periods than one month.
But with a greater number of rental properties available than in the past, renters have more ability to negotiate on price. In some cases, property owners are lowering prices in an attempt to keep their properties rented all summer, Realtors said.
Anticipating that this summer’s rental season wasn’t going to be as robust as in the past, Randall Realtors counseled its homeowners in South County to hold the line on rental prices from last year, Cohen said.
Durkin, whose family has been renting beach houses in the Point Judith area for 50 years, is offering rental discounts of up to 20 percent in an attempt to fill vacancies this summer.
“If you haven’t booked your summer vacation by now then you’re in good shape,” Durkin said. “A lot of people walk in the office and they’re surprised that we have stuff available.”
