Its beach nearly gone, waterfront home on Nantucket sells for just $600k. What does the sale

The 2,625-square-foot property on Sheep Pond Road was first listed in September for nearly $2.3 million, still below the median sale price of $3.2 million on Nantucket. But after the shoreline lost a stunning 70 feet to erosion in just a matter of weeks, putting the home at imminent risk, the price plunged to $600,000 by year’s end.

A longtime visitor to Nantucket, Brendan Maddigan, who lives in New York, toyed with owning a summer home there for his young family for years. He regularly scanned the market and bookmarked links to a half-dozen properties, including the house on Sheep Pond Road. When he got an alert the price had nosedived, he submitted an all-cash offer, and in February the home was his.

From growing up in Woods Hole and now working for a real estate investment firm in New York City, Maddigan, 42, said he is clear-eyed about the risks, especially as sea levels rise and storms become more intense.

“The home is amazing. The location is amazing. And the price mitigates the risk to a good degree,” he said. “I’d like to think that it’ll be there for a while, but I was definitely aware of the risk of any particular storm causing a problem in the future.”

The Nantucket Current was the first to report the news of the sale.

Real estate agents and climate experts said the stunning price drop illustrates how much climate change has affected the housing market in coastal communities.

Properties in certain areas may be permanently devalued. Insurance companies may increasingly refuse to cover threatened homes. Some people will sell, unwilling to lose their home to the sea, and others will jump at the price, no matter how high the risk.

On Nantucket, the coastline has always been under siege, but homes falling victim to erosion will “start happening more and more,” said Shelly Lockwood, a real estate broker on the island who believes it’s crucial for potential buyers to be informed about the threats. “Homes in certain areas, homes on certain streets, are going to go down in value. That’s inevitable.”

Lockwood, who did not handle the sale of the $600,000 home, said the market has been slow to adjust to the new landscape. There are three other estates on Sheep Pond Road on the market, the least expensive of which is listed for almost $3 million. All three, she predicts, are “going to fall in” the ocean.

“But the real estate world on Nantucket is going at these at-risk houses house by house, as though they’re anomalies,” Lockwood said. “When if you talk to [the Nantucket Coastal Resilience Advisory Committee] there are literally hundreds of houses at risk.”

A number of homes on Nantucket have already been lost. Billionaire Barry Sternlicht’s beach house is slated for demolition because of significant erosion, the Current reported. A home near Maddigan’s was demolished in October after losing approximately 35 feet of dune in a matter of months. More than a decade ago, another house on Sheep Pond Road lost its battle with the tides, and parts of the road were washed away multiple times — including in 2003, 2010, and 2021.

When Lynn Tidgwell purchased the Sheep Pond Road property in March 2021 for $1.65 million, according to town records, it was more than 100 feet from the top of a coastal bank. A geological study estimated the home would last at least two decades, if not more, at the current rate of erosion.

“I took the gamble due to the magnificent beauty of the location,” Tidgwell said.

But over the next two years, the land around the house was whittled away. In need of more space for her family, she decided to sell it in July after losing about 15 feet of backyard. Hurricane Lee swallowed up another 20 feet in September, and an incredible 70 feet was lost between then and December, she said.

“This rate of erosion was not typical,” Tidgwell said by email. “Therefore, I dropped the price significantly in the knowledge that any prospective buyer was taking a risk.”

Leah Hill, Nantucket’s coastal resilience coordinator, said some property lines on the island are now fully underwater.

If the town and private property owners fail to reduce coastal risks from now through 2070, nearly 2,400 structures are at risk from coastal flooding and erosion, with cumulative annual damages estimated at $3.4 billion, Hill said by email.

Based on those findings, Nantucket developed a coastal resilience plan, which includes educating homeowners about ways to protect their properties.

Many prospective buyers, including Maddigan, contact Hill about risks associated with a property, and while she does not offer real estate advice, she shares the “most up-to-date data regarding historic, current, and future projections for flooding and erosion.”

Sea levels have risen 8 inches between 1965 and 2019 on Nantucket, according to the plan.

Nantucket and Martha’s Vineyard have among the highest rates of beach erosion statewide, according to the Trustees of Reservations State of the Coast 2021 report, which found that parts of the south coast of Nantucket have receded as much as 1,800 feet since the 1800s. Combined, the islands have lost more than 5 square miles of coastal areas from erosion since 1887.

The Federal Emergency Management Agency projects as much as 3,000 acres of beachfront on the islands are at risk of eroding by 2050, according to the report.

“Billions of dollars of coastal real estate at-risk [on the islands] will impact an economy and a way of life that is inextricably tied to the coast,” the report said.

Some real estate agents are confronting that risk head-on. Fisher Real Estate created a blog outlining resources, such as flooding and erosion maps, and will also recommend home inspectors, structural engineers, and insurance companies, said agent Sarah Holmes.

Holmes said she was not “totally shocked” by the price drop to $600,000 given the “substantial” amount of erosion, but others could hardly believe the reduction.

“Our phones truly rang off the hook,” she said.

After growing frustrated by seeing at-risk properties selling for much more than she believed they were worth, Lockwood worked with Hill and Isabelle Perkins, a licensed real estate instructor, to develop instruction on coastal resiliency and climate risks that will be included in a continuing education class for local agents starting in June.

“If we get known as people who will just sell anything, that hurts all of us,” Lockwood said. “We have a fiduciary duty to our clients and we really needed to be giving them this information.”

At some point, home insurance claims will become so high that the “industry is going to rethink insuring homes in certain areas,” she said.

In other parts of the country, that has already begun, said Alice C. Hall, a senior fellow on energy and the environment at the Council on Foreign Relations.

State Farm won’t accept new applications for policies in California because of wildfires, and Allstate has also pulled back, she said. Several major insurance carriers have left states, including Florida and Louisiana, because of flooding and storm risks.

Climate change is “disrupting the property insurance market” and will at a greater scale as extremes grow, she said.

“The question becomes, first of all, will anyone pay those higher premiums, and then second, do they even want to do the business at all?” she said. “That will change the dynamics of the real estate market.”

When homeowners inquire about how to protect their properties, Hill recommends they contact a local wetland engineering firm to help them determine a solution that meets town and state regulations.

“It is difficult to have long-term protection strategies in highly dynamic environments on an island made of sand located 30 miles out to sea,” she said.

The Nantucket Conservation Commission, which owners must seek permission from before doing anything within 100 feet of a shoreline or dune, “leans towards nature-based solutions” she said. “However an applicant can apply for any coastal engineering structure,” such as a seawall, bulkhead, or revetment, but it may not necessarily be approved, Hill said.

A high priority of Nantucket’s coastal resilience is a program to “retreat” from the shoreline by, for example, relocating homes, Hill said. Additionally, some owners have raised their houses, installed flood vents, and planted vegetation.

Maddigan said he bought a typical insurance policy, so the property is protected the same way that a house inland is. He is looking into ways to protect his home, such as building a small berm with dune grass, but said, “realistically,” nothing will save his property from a major storm.

“I took the chance, and I hope it’s long enough that my children have great memories of being there,” Maddigan said. “And who knows, maybe we’ll get lucky.”

Shannon Larson can be reached at shannon.larson@globe.com. Follow her @shannonlarson98.