The first Cape Cod style homes were built by English colonists who came to America in the late 17th century. They modeled their homes after the half-timbered houses of England, but adapted the style to the stormy New England weather. Over the course of a few generations, a modest, one- to one-and-a-half-story house with wooden shutters emerged. Reverend Timothy Dwight, a president of Yale University, is credited with recognizing these houses as a class and coining the term "Cape Cod."

Twentieth century Cape Cod houses often have dormers. The chimney is usually placed at one end instead of at the center. The shutters on modern Cape Cod houses are strictly decorative; they can't be closed during a storm. Cape Cod Homes have steep roof pitches and narrow overhangs. 

The Cape Cod style home carries a unique feature in that consumers can get a mortgage on one of these homes with the upstairs unfinished. This is the perfect home for the consumer who is looking to finish a part of their home at a later date. Getting a mortgage on a “partially” finished home is nearly impossible to do, but since the upstairs of a Cape Cod and be considered attic space, the ability to close on end financing is possible.