Prices in the Hamptons hit new records in the third quarter, as wealthy New Yorkers fled the city and continue to buy homes on the beach, according to a new report.
The average sales price in the Hamptons soared 46% in the quarter, to just over $2 million, according to a report from Douglas Elliman and Miller Samuel. The median sales price jumped 40% to $1.2 million, which is now higher than Manhattan’s median sales price of $1.1 million.
“I’ve never seen a market like this,” said Gary DePersia, a Hamptons broker with Corcoran. “It doesn’t show any signs of slowing down.”
The surge in the Hamptons comes as hundreds of thousands of New Yorkers fled the city during the coronavirus pandemic and searched for homes with more space outside the city. While it’s unclear how many New Yorkers will return to the city, and how the flight of the wealthy will affect New York’s economy longer term, the pandemic has dramatically redrawn the urban real estate landscape. The Hudson Valley, western Connecticut and the Hamptons all saw a surge in sales in the third quarter, while Manhattan saw a 46% drop in sales.
Jonathan Miller, CEO of Miller Samuel, said one enduring trend of the pandemic will be the rise of the “co-primary residence,” where families spend equal time in the city and at their rural or resort homes, since they can now work and even attend school remotely.
“It’s not a second home anymore,” he said. “It’s on equal footing.”
While the Hamptons has long been the high-priced weekend escape for the New York wealthy, it has quickly become the year-round bunker for the New York elite during Covid. Normally, the restaurants and shops empty out by Labor Day. But DePersia said restaurants and bars are still full and many families aren’t sure when or if they will return to the city.
Beach homes are seen on September 30, 2020 in Southampton, New York.
Kena Betancur | AFP | Getty Images
“They want to get back to their lives in Manhattan,” he said. “But no one knows when that will be. “
Home sales in the Hamptons remain strong at all levels, brokers say, from under $1 million to more than $20 million. Miller said that 15% of homes sold in the quarter went for more than the asking price, likely the result of a bidding war. That total, he said, is about twice the historical average for the Hamptons.
Last year’s third quarter saw record high inventory, as a result of changes to the treatment of state and local taxes, which hurt all areas of New York real estate. Now, inventory is shrinking fast and there are waiting lists for newly built homes. Listing inventory of luxury homes in the Hamptons fell 43% in the quarter.
The most expensive sale in the quarter was a three-acre property at 38 Two Mile Hollow Road in East Hampton, with a tennis court, pool and 8,000-square-foot house, that went for $24 million.