Noel Roberts, a luxury real estate expert and longtime local Million Dollar Beach House star, speaks to Inman about what the Hamptons market looks like today.
A year ago this time, a house in the Hamptons was like winning the lottery for the summer. After New York became a coronavirus hot spot, affluent residents paid everything to escape the city and secure a place in the affluent enclave.
A city man paid nearly $ 2 million to rent a Bridgehampton property from April through Labor Day. Many more booked a year in advance to secure their spot for the coming summer, while others stayed year-round, potentially changing the region’s status as a summer escape for good.
“Both buyers and tenants over-budgeted to secure something last year,” Noel Roberts, director of Nest Seekers’ local retail boutique and star of Million Dollar Beach House, told Inman. “This year and at the end of last year, buyers rated the pre-COVID comparisons. Many returned to ask questions like “When did the sellers buy?” and ‘how much did the sellers pay for it?’ ”
Today it may not be so desperate, but the market is still struggling with a shortage of inventory and adjusting to the influx of year-round residents. Roberts is a luxury real estate expert and a longtime local. He talks to Inman about what the Hamptons market looks like today.
The 2020 Hamptons market was marked by wealthy “panic buying” and “panic renting”. How is the situation now?
In 2020, most people were in a panic and a frenzy. Everyone grabbed toilet paper and the rich were no different except grabbing real estate.
Both buyers and tenants went over budget last year to secure something. This year and late last year, shoppers rated the pre-COVID comparisons. Many returned to ask questions like “When did the sellers buy?” and “how much did the sellers pay for it?”
They are a little more aware and sensible about what the situation will be like in a post-COVID world and the value of their assets. Nobody wants to make a bad decision in the long run, especially when it comes to a $ 5 million to $ 10 million fortune.
Traditionally, March and April were the time to look if you wanted to be in the Hamptons for the summer. Is it fair to say that those who watch now are late for the game?
You will always have people late for the party. The plan didn’t work out for some reason and they try to find a rental a few weeks or a month later. People are just less picky about making sure they have something and not laying in the dust for the summer.
People started securing their rent for this year last year. Never before have you seen people try to secure rents nine to 12 months in advance. They left the place in August and were already trying to get a place for the next year.
So it seems that the inventory hasn’t improved much.
I think the number of houses that are coming off the market has decreased. We are still dealing with buyers and tenants who stop by to either bid or snag them as new things emerge [the market.]
Inventories are still rough, especially on the rental side. The owners still get what they ask for.
It’s interesting because, on the one hand, I represent buyers and renters trying to secure a home they deem appropriate and, on the other hand, I represent sellers and landlords who want to benefit from the continued interest and benefit of people coming out to the Hamptons.
But there is certainly a sub $ 2 million market that is still pretty active. The average number of home sales has increased to around $ 1.4 million last year compared to that time. It was picked up, but it’s still pretty active for buyers looking for those Starter Hamptons homes – $ 1 million to $ 2 million and up.
Even after the year we’ve had, the connection most have with the Hamptons is a summer vacation. Has the pandemic affected seasonality so much that it first appeared?
All my heart. I live here all year round and never before could you come here in November or January and still see so much traffic and cars in the parking lots. Lots of people stayed out here all year round.
I have certainly put a number of my clients into off-season and year-round rentals. The seasonality has changed enormously.
What do you think will happen in the Hamptons market in late 2021 and 2022? Could interest fade as people turn to international travel to make up for lost time?
It’s hard to look that far, but I know that there will end up being a lot more people than usual living in the Hamptons year round. They have permanently changed their work / life situation and made this their permanent home.
Once you own a home here, it’s a great market to rent it out for the month of August, recoup much of your expenses for the year, and then go ahead and travel. They will rent their house for a month or two, travel to Greece or Portugal or wherever it will be and then return to the Hamptons as a home base.
What else are your customers talking about?
Last year, not only did you have the pandemic that caused a lot of activity, but you also had a change in administration that almost certainly affects the richest Americans. Some people wanted to get out of their traits, especially after seeing a lot of appreciation.
Some of my clients wanted to get out by the end of last year and I think we’ll continue to see a lot of people doing the same before new changes go into effect. They would much rather have success with the current capital gains tax now than in 2022. It’s been a great year if you had some capital and wanted to buy a house in the Hamptons. If you are into it for the long term, it continues to be a great place to park this capital city.
If you’re a salesperson, a lot of the conversations with my clients north of the $ 5 million to $ 10 million mark have been about exit strategies.
Email Veronika Bondarenko