Gregory J. Heym
Executive Vice President, Chief Economist
By Oshrat Carmiel and Ashwin Seshagiri
Home prices in New York’s Hamptons, the Long Island resort towns favored by summering Manhattanites, increased 4.2 percent in the second quarter from a year earlier as buyers opted for more expensive beach properties.
The median price of homes that sold in the quarter rose to $937,500 from $900,000 a year earlier, according to a report today by New York appraiser Miller Samuel Inc. and broker Prudential Douglas Elliman Real Estate. Thirty-nine percent of all sales completed in the Hamptons and Long Island’s North Fork were for houses priced at $1 million or more, the second-highest market share for such properties in three years.
“I’d look at the market as stabilized but punctuated with very visible trophy property sales,” Jonathan Miller, president of Miller Samuel, said in a telephone interview. “This is a phenomenon we saw in Long Island, Brooklyn, Queens, Manhattan and Westchester. Across the region, the top end of the market outperformed the overall market.”
Luxury homes are attracting buyers as Wall Street executives spend bonuses and employment improves, said Judi Desiderio, president of Town & Country Real Estate in the Hamptons. New York City’s financial industry showed a net gain of 10,400 jobs in the 12 months through May. The city’s overall jobless rate was 8.6 percent that month, unchanged from a 25- month low in April and down 1 percentage point from a year earlier, the state Department of Labor said on June 16.
Above $5 Million
Twenty-four homes in the Hamptons and North Fork, which constitute Long Island’s East End, sold for $5 million or more in the second quarter, compared with 22 a year ago, according to Miller. The median price for luxury properties, defined as the top 10 percent by price, climbed 7.9 percent to $4.4 million.
“They get their bonus and they think, ‘hard asset -- let’s go buy some East End dirt,’” said Desiderio, referring to the Wall Street payouts that drive the Hamptons real estate market. “They’re finally spending the money.”
The most expensive home that sold in the quarter was a 10- bedroom, 12-bathroom house at 1710 Meadow Lane along the Atlantic beachfront in Southampton, which went for $32.5 million, according to Miller and broker listings.
The demand for high-end homes thwarted Karen and Bruce Kopelman from buying after they were outbid on two houses in the $3 million to $5 million range. The couple, who rent a home in the Hamptons full time after selling their house a year ago for $3.75 million, have been searching for proprieties in Sagaponack or Bridgehampton, south of the primary highway of Route 27.
They most recently lost out on a Bridgehampton home after thinking they were close to a deal, Karen Kopelman said.
“Somebody just outbid us,” she said. “I bid less, and they came in right about at asking.”
Kopelman, 52, said she has seen a rebound in the market from last year, when her property ended up selling for less than its asking price of $4.45 million.
“There are a lot of homebuyers, because we’ve had a recession and the market is better now,” Kopelman said. “It’s definitely better now than it was a year ago.”
Two other reports this month also show increases in Hamptons prices in the second quarter. Town & Country said in a July 15 report that prices climbed 14 percent across the 12 towns and villages that comprise the Hamptons. Brown Harris Stevens, a New York brokerage, said in a report today that the median price of sold homes jumped 18 percent to $1.1 million.
Fifty-one percent of the properties that changed hands were priced at $1 million or more, the first time since the third quarter of 2007 that a majority of Hamptons transactions were above that threshold, said Gregory Heym, chief economist at Terra Holdings LLC, which owns Brown Harris.
The Corcoran Group, which also released a report today, said median prices fell 3 percent to $900,000. Prices for vacant land slid 34 percent to a median of 578,000, as “investors hesitated to speculate,” according to the brokerage’s report.
“I don’t think its booming, I think it’s healthy,” Dottie Herman, president of Prudential Douglas Elliman, said in an interview. “It’s a slow recovery.”
In the overall Hamptons market, homes took 44 percent more time to sell in the quarter than they did a year earlier, averaging 188 days on the market, according to Miller Samuel and Prudential. Luxury homes, defined this quarter as properties priced $3.3 million or higher, spent an average of 98 days on the market, 32 percent less time than they did a year ago.
Thursday, July 21, 2011