Cape landlords sing empty rental blues A surplus of summer places and a reduced demand are adding up to a dismal season.

By SUSAN MOELLER and ETHAN ZINDLER
STAFF WRITERS
From one end of the Cape to the other, summer rental agents are bemoaning one of the weakest seasons in years, citing a glut of available units and decreased demand by visitors.

"Normally, I would be touting June and September availability right now," says Rosemary Cataloni, who operates Waterfront Rentals, a West Yarmouth based firm with 200 available properties Capewide.

"I have Fourth of July available. Right now, I have all weeks."

Cataloni, who has been renting summer homes on the Cape for 25 years, sites an unusually large number of properties on market this season. And to make things worse, the phone isn't ringing the way it once did.

"It appears to be a classic demand-supply problem: Too many homes chasing too few vacationers," wrote Jeff Talmadge, who runs weneedavacation.com, in an email. His site hosts more than 2,100 rental listings on the Cape and islands, up from 1,480 at this time last year, and charges homeowners to list.

Clearly, homeowners are getting nervous. In May, Talmadge's clients lowered their rents on 2,700 different occasions. The average price of a Cape or islands home rented through weneedavacation.com this year: $2,239 a week.

In an effort to manage client expectations for the season, Talmadge urged homeowners to make their properties look their best online.

"You want the vacationers to look at your pictures and read your description and say to themselves, 'This is where I'd like to spend my vacation,'" he wrote in a monthly newsletter.

Blame the marketA confluence of factors appear to be contributing to this year's wobbly market. Among them: a red-hot real estate sales market that has driven prices into the stratosphere and put new second homeowners under the gun to raise cash to cover mortgage payments.

That's putting long-time homeowners in a pickle as well.

"I haven't rented a week yet," said Fred Cook, who has owned a five-bedroom house in East Dennis since the 1980s. He's offering it for rent on weneedavacation.com for July and August. Cook once ran a bed-and-breakfast at the property but has been renting it for five years.

Last summer, Cook, who lives in Palm Harbor, Fla., was able to get as much $5,000 for busy weeks in July and August.

Not this year. He's lowered his price 25 percent and still has plenty of open time.

"I talked to Realtors and they said this was one of the worst years that they had ever had," he said.

Blame the economyThe economy may also be to blame. There are troubling signs that consumers have yet to get the memo about the economic turnaround.

As part of its monthly consumer confidence survey, the New York-based Conference Board asks consumers whether they plan to travel "in the next six months."

In March of last year, only 42.7 percent of respondents said they planned to travel -- the lowest response rate the board had received to that question in 20 years. What followed was one of the weakest summer rental seasons in recent memory, according to brokers.

This March, the Conference Board planned vacation figure was almost exactly the same. And consumer spending figures have been lackluster too.

Closer to home, the Massachusetts employment rate is down from a year ago. But the drop may be due to a growth in the overall workforce; the number of actual payroll jobs in the state has stayed level in the last 12 months, according to U.S. Department of Labor data.

Not surprisingly, the increased availability of summer homes has emboldened renters.

"They ... do not feel the pressure of past years to book as early in the rental season," says Talmadge. "Vacationers are bargaining more than we have seen in past years."

This year's weak market may also be due to changing consumer habits. Vacationers are more likely to take multiple short trips than one long one, says Peter McDowell, a Dennis based Realtor who has been renting locally for 25 years.

"I don't know what the answer is but I am not sure that this is relevant to the economy," he says.

McDowell says the number of leases he's inked for the summer is off 11 percent from this time last year. Actual dollars committed is off 14 percent. And that's compared to last year, which by historical standards wasn't great.

The rise of the Internet and an increasingly on-demand culture may have permanently altered renter psychology. Even during recessions, the Cape had no trouble attracting renters, says McDowell.

"Even if father got laid off, they still came," he says. "They just didn't spend a lot of money when they got here."

"If this continues, say, next year, then maybe, maybe something's happened here."

(Published: May 29, 2004)