The Hamptons ‘middle class,’ comprised of New Yorkers with somewhat modest million-dollar second homes out East, have been dropping their asking prices by more than 25 percent in a bid to sell their homes.
Because of growing interest rates and the post-pandemic need to be in the city more often, many middling Hamptons staycationers, who own properties up to $5million, are attempting to sell their homes at reduced prices.
In some cases, owners have cut their asking prices by hundreds of thousands of dollars in Sag Harbor and Amagansett.
One agent told the NYPost that prices for homes on the lower end of the spectrum are dropping. They said: ‘We’re not talking about the ultra-wealthy here – these people are subject to economic norms.
This property in Sag Harbor, which is currently on the market for $2,395,000, has had its price knocked by a total of 26 percent since February 2023
‘When it comes to having a vacation home, it’s just not as easy to justify the cost.’
The sudden bounce is believed to be linked to the highs seen during the pandemic, when buyers were paying double for homes out East, have now settled.
Without widespread work from home rules, and people forced back into the office in the city, many with their second homes are struggling to justify keeping them.
The source said: ‘I know a lot of people turning their remote offices in the Hamptons back into bedrooms and putting them on the market.’
One property in Sag Harbor, which is currently on the market for $2,395,000, has had its price knocked by a total of 26 percent since February 2023, according to Zillow.
Before then, the six-bed, six-bath Hamptons home with its own private pool was listed for $3,250,000.
The home, located in picturesque Sag Harbor, is described as ‘a unique investment opportunity’ for a buyer who wants to give it ‘some tender loving care.’
There is a spacious 3,285 square foot main house with five bedrooms and three and a half baths, as well as a private-entranced one-bedroom, one-bath apartment suite for visiting guests.
The listing on Zillow states: ‘On warm summer days, take a dip in the inviting gunite pool, shoot some hoops, or go enjoy the deeded beach with mooring rights that is the gateway to Long Beach and its breathtaking sunsets on Peconic Bay.
‘This is a golden opportunity. With a proven track record of generating income from both long and short-term rentals, this compound presents incredible potential.’
Still despite the sizeable cut, the home is still sitting on the market.
Similarly, in luxurious Amagansett, NY, a three-bed home’s asking price was cut by 23 percent in the last month alone.
On October 1, the stunning property was listed at $1,795,000 – but this was cut to $1,395,000 by October 24.
This property in Sag Harbor is currently listed for $2,800,000, which is a 12.5 percent drop on the asking price since the summer
On August 18, this house was listed for $5,700,000, but that was dropped to $4,995,000 a month later in September – making it a 12.4 percent decrease
The beach cottage boasts water views of Napeague Bay in Amagansett’s hidden gem, Lazy Point.
Buyers can enjoy ‘majestic sunsets and spectacular sunrises with views stretching to the Connecticut shores from this charming home that exudes peace and tranquility from a bygone era.’
The listing adds: ‘The home is equipped with three bedrooms, a full house generator, and central air conditioning and is set upon a picturesque double lot size of .38 acres.’
Another home in Amagansett has dropped its asking price significantly in recent months in a bid to get off the market.
On August 18, it was listed for $5,700,000, but that was dropped to $4,995,000 a month later in September – making it a 12.4 percent decrease.
The five-bed, seven-bath property, which is on a private quiet cul-de-sac, is just ‘moments away’ from ocean beaches.
There are 18 foot cathedral ceiling in the living room and a double-side gas fireplace shared with the dining room – set on private, lush grounds with a 20 x 40′ gunite pool.
In luxurious Amagansett, NY, this three-bed home’s asking price was cut by 23 percent in the last month alone. On October 1, the stunning property was listed at $1,795,000 – but this was cut to $1,395,000 by October 24
This waterfront property in Sag Harbor dropped the price by 23.9 percent since October last year – and it is still on the market
On September 7, another quintessential Sag Harbor home was listed for $3,200,000 – but within six weeks the asking price dropped by 12.5 percent to $2,800,000.
Zillow described it as having ‘classic charm and modern convenience,’ including an open floor plan, top-of-the-line appliances and four bedrooms.
Outside, it has a ‘beautifully landscaped backyard with a spacious patio deck overlooking the heated pool.’
This emerging trend comes after a former Oppenheimer analyst who was dubbed the ‘Oracle of Wall Street’ predicted that house prices are set to plummet for the first time in a decade.
Meredith Whitney is famed for sending an accurate research report sounding the alarm overs risks incurred by Citigroup before the financial crisis.
But as warning bells emerge again over the health of the US economy, Whitney told Insider she did not fear another recession thanks to robust consumer spending which has been bolstered by low unemployment rates.
Instead, her focus is on American house prices which she expects to decline for the first time in over a decade. It marks a stark reversal of a pandemic-inspired trend which has seen home values shoot up by 42 percent since March 2020, according to CoreLogic.
These are the five cities where house prices have risen the most, and the five where they have fallen the most, according to the S&P CoreLogic Case-Shiller US National Home Price Index
However, Texas could fare much better – after experiencing a huge influx of California residents who migrated there in search of cheaper living costs.
She said: ‘This is state-specific. And so I expected this to happen. With 10-years-plus — 12 years — of data, now I can look at it and know that, in fact, it did happen and it is happening.’
But trends in the current climate have shown otherwise.
US home prices rose for the seventh consecutive month in August – hitting a record high – according to new data.
Prices increased 0.9 percent in August from the month prior, according to the S&P CoreLogic Case-Shiller US National Home Price Index – the leading measure of US house prices.
It means year-on-year properties have gone up by 2.6 percent, the Case-Shiller data showed.
Mortgage rates are at a multi-decade high – with the average 30-year fixed-rate deal hovering around 7.79 percent, according to Government-backed lender Freddie Mac.
Soaring mortgage rates, and historically low inventory, have continued to push up home prices in the majority of the country’s 20 biggest cities.
According to the Case-Shiller 20-city composite, 12 cities saw average home prices increase in the year ending August 2023 versus the year ending July 2023, while seven saw prices decline, and one was unchanged.