In The Hamptons, Sales of Homes Priced at $5 Million-Plus Jumped 291% Last Quarter
22 October 2020 - 1:30PM
Dow Jones News
By Katherine Clarke
The median sales price for a house in the Hamptons, the string
of beachfront communities on Long Island's eastern tip, skyrocketed
by 40% to $1.2 million in the third quarter of 2020 compared with
the same period a year earlier, according to a new report from
brokerage Douglas Elliman.
The surge in prices, spurred by New Yorkers fleeing to the beach
amid the coronavirus pandemic, is a remarkable turnaround for the
market, which posted a dismal 2019 defined by repeated price cuts
on luxury homes.
The surge in prices is even more dramatic for homes on the
ultrahigh end of the market, defined by the report as the top 10%
of all sales. The median price for a home in that category was up
by 65.7% year-over-year to $5.8 million.
Overall, the volume of sales in the Hamptons was up by 51% from
last year and up by 291% for closings priced $5 million and up,
according to Jonathan Miller of Miller Samuel, who prepared the
report on behalf of Elliman.
Mr. Miller said it is the first time he can remember seeing the
Hamptons market deviate so much from that of Manhattan, since the
two markets usually act in tandem. The Hamptons market relies on
the wealthy wanting to live in the city and spending summers "out
east," he said.
The coronavirus upended those assumptions as wealthy
Manhattanites poured into the Hamptons at the onset of the pandemic
and settled in for much longer than they initially expected. For
some, the Hamptons has now become their primary home, at least for
now, and some have enrolled their children at local schools and
gotten accustomed to working remotely and attending meetings via
Zoom. By comparison, sales were down by 46.3% in Manhattan in the
third quarter.
"For years, I've always described the Hamptons as being joined
at the hip with Manhattan and with Wall Street," said Mr. Miller.
"Here you have the secondary market outperforming the primary
market that it has depended on."
The level of activity in the third quarter left Hamptons
inventory 28.4% below the prior-year levels. There are now about
nine months of supply of homes on the market based on the current
pace of sales, compared with about 19 months during the same period
last year. Some of the Hamptons' biggest transactions of the third
quarter included the $24 million sale of a seven-bedroom oceanfront
compound with a tennis court in East Hampton and the $23.5 million
sale of a 7.37-acre, eight-bedroom estate in Sagaponack.
Enzo Morabito, a luxury agent at Douglas Elliman, said he has
close to 20 high-end homes in contract right now, a number he
called "beyond incredible." Buyers who fled to rentals in the
Hamptons early in the pandemic have now converted to buyers, with
many looking for move-in ready houses that don't require work,
since they don't want strangers in their homes, he said. Some
expensive plots of land have even started to trade after a slow
couple of years. "That's usually the last thing to go, " he
said.
While contract activity doesn't appear to be slowing down in the
early fourth quarter, Mr. Miller said it is not clear if the
Hamptons boom is built to last.
"Right now we're at peak Zoom," he said. "It's not clear how
much of this sticks once there's a vaccine."
Write to Katherine Clarke at katherine.clarke@wsj.com
(END) Dow Jones Newswires
October 22, 2020 08:15 ET (12:15 GMT)
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