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Hamptons Life

Oct 26, 2017 12:09 PMPublication: The East Hampton Press & The Southampton Press

Hamptons Home Sales Impress In Third Quarter Of 2017

81 Briar Patch Road in East Hampton, the second-biggest sale of the third quarter of 2017. COURTESY COMPASS
Oct 30, 2017 11:34 AM

Newly released reports on the performance of the Hamptons real estate market during the third quarter of 2017 give real estate professionals—and anyone with an interest in the East End economy at large—much to be happy about.

Prepared by real estate companies that do business on Eastern Long Island and farther afield, the reports vary in their findings, as each is based on a different methodology and geography. But, taken collectively, they give a comprehensive picture of the state of the Hamptons real estate market—and it’s a good one.

Compared to the same quarter in 2016, which itself was robust, the market has improved, with total sales volume going up and inventory going down. By some metrics, the market did not do as well during the months of July, August and September in 2017 as it did during those months back in 2015—but 2015 was a banner year that would be difficult to beat.

Considering only single-family homes, Douglas Elliman reported that the average sales price in the Hamptons slipped 3.5 percent, from $1,791,583 in the third quarter of 2016 to $1,728,113 in the third quarter of 2017. Meanwhile, the median sales price increased 6.8 percent, from $850,000 to $908,000. The total number of sales dropped by 1.4 percent, from 500 to 493. Inventory of single-family homes fell by 4.7 percent, from 1,445 to 1,377.

The Hamptons condominium market had a superb quarter, according to Douglas Elliman. The average sales price rose 44.9 percent, from $417,882 during the same quarter a year ago to $605,467, and the number of sales was up 41.2 percent, from 17 to 24. The average number of days that transpired between when a condo was listed for sale and when it sold fell by 34.5 percent, from 148 days down to 97 days.

Carl Benincasa, Douglas Elliman’s regional vice president of sales for the Hamptons, said the increase in condo sales is a popular topic of discussion, as it is changing the view homebuyers have of the Hamptons.

“People, naturally, they don’t associate the Hamptons with condo living,” he said. “They think of sprawling estates and large lawns and gardens and all that, and certainly this market has plenty of that to offer. But we have some really beautiful condo units, too.”

Mr. Benincasa said high-profile condo projects that have hit the market recently on the South Fork, such as Watchcase in Sag Harbor, may have contributed to raised awareness of the convenience, locations, manageability, aesthetics and relative affordability of condos.

The Corcoran Group reported that the number of home sales on the South Fork ticked up 2 percent, from 587 in the third quarter of 2016 to 601 in the same quarter this year. Paired with a 6 percent increase in average sales price—from $1,746,000 to $1,847,000—the result is an 8 percent increase in total sales volume. The total shot up from $1.025 billion to $1.110 billion.

The median price for the quarter was $960,000, up 7 percent from $900,000 in 2016, according to Corcoran. Back in the third quarter of 2015, the median price was a bit higher, $975,000.

Ernest Cervi, the regional senior vice president of the East End for Corcoran, said the third quarter of 2017 was very strong across all indices.

The luxury market—the top 10 percent of residential sales—saw the average sales price go up 5 percent, to $8,204,000 for the quarter, according to Corcoran.

The top sale recorded in the third quarter was 211 Lily Pond Lane in East Hampton for $29,000,000. Hillary and Bill Clinton had rented the home for sojourns in the summers of 2011 and 2012. The buyer of the 10,000-square-foot residence on the ocean was Rick Blatstein, the founder and chief operating officer of OTG Exp, which facilitates chef, restaurant and airport collaborations.

The second-highest sale was for $25,925,000. The property was 81 Briar Patch Road in East Hampton, a 12,000-square-foot residence known as Pond House, recently renovated by architect Jeffrey Cole. The buyers were reportedly Jay-Z and Beyonce.

On the opposite end of the market, homes that sold for up to $500,000 made up 38 percent of total home sales west of the Shinnecock Canal, from Remsenburg to Hampton Bays. That’s down from 44 percent in the same quarter a year ago.

East of the Shinnecock Canal, from Southampton to Montauk and including Shelter Island, sales of homes for under $500,000 made up just 10 percent of the total number of homes sold. It was 8 percent in the third quarter of 2016.

The total inventory of homes for sale on the East End fell to 5,998, the first time in several years that the inventory has been under 6,000 for a quarter. On the South Fork, particularly east of the Shinnecock Canal, anything less than $1 million is increasingly hard to come by.

“When we look at the inventory levels below a million, those have fallen dramatically,” Mr. Cervi said. “That inventory’s been absorbed. So, you’re seeing people make purchase decisions at higher price points across the board.”

The scarcity of houses asking less than $1 million seems to be why there is such a strong appetite for the condominium market, Mr. Cervi said, noting interest in the Southampton Pointe condos, which recently went up for sale in Tuckahoe, and Harvest Point, a 55-and-over condo complex in Cutchogue that is in the midst of development. Corcoran is representing both.

Things also are looking up for the current quarter, which began October 1. “At the same time we do the market report, we survey our agents,” Mr. Cervi said. “And our agents are really the live data source as opposed to the historic data source. And they’re feeling very confident about the fourth quarter.”

He doesn’t see a slowdown on the horizon.

“If you look at what’s going on in the economy, we’re hitting record highs every day in the stock market, people are feeling confident about the economy, and I think purchases are going to continue,” Mr. Cervi said.

He noted that inventory typically increases around the first of the year, as owners make decisions to move on from their house, or to stop renting out the property. Also, he said, as prices go up because the inventory has been low, more owners will be motivated to list their homes for sale.

The Town & Country homes sales report—which considers only single-family homes and excludes transactions that may skew averages, such as a transfer of partial interest in a property—states that there were 334 sales in the Hamptons in the third quarter, up 8 percent from the same quarter a year ago, when there were 308 sales. Also about 8 percent were both total sales volume, which reached $596,233,806, and median home sales price, reaching $917,555.

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