The average price of a single-family home in the Hamptons hit a record $3 million in the first quarter, underscoring the shortage of luxury beach homes for sale and the resilience of wealthy buyers.
According to a report by Douglas Elliman and Miller Samuel, the average sale price in New York’s beach communities rose 18% in the first quarter to $3.1 million. The average sale price in the Hamptons is now more than $1 million higher than the average sale price in Manhattan. According to Miller Samuel, this is the largest gap between the two markets since data collection began in 2005.
The surge reflects a persistent shortage of homes for sale, as well as continued demand for Hamptons real estate from wealthy buyers. The wealthy are bidding and buying despite stock market volatility, rising mortgage rates, tech and financial layoffs and recession fears, brokers said.
“We have more buyers than sellers,” said Todd Bulgard, chief executive of the Douglas Elliman Long Island, Hamptons and North Forks area. “The buyers are there.”
The top end of the Hamptons market is strongest. In the luxury market, which accounts for the top 10 percent of sales, both median and average sales prices broke records in the first quarter, with average luxury prices surging 33 percent, said Jonathan Miller, chief executive of Miller Samuel. to $16.1 million.
More than 14 percent of sales in the luxury market are the result of bidding wars, Miller said.
“The high end of the market is still somewhat untouched,” he said. “Some people are less concerned about the macro environment when they take action.”
A waterfront home is seen in East Hampton, New York.
Jeffrey Basinger | Reuters
The Hamptons saw many oversized home sales in the first quarter. A 6.7-acre estate in East Hampton sold in March for $91.5 million, more than double what it sold for in 2020. A 3,000-square-foot Montauk home once owned by Bernie Madoff sold for $14 million. A modern 5,500-square-foot waterfront home in Bridgehampton sold for about $35 million in an off-market sale, brokers said.
Even tiny homes in the Hamptons fetch big prices: A mobile home in the Montauk Shores community sold for $3.75 million.
However, the lack of homes for sale has led to a sharp drop in total transactions. Sales plunged 57% in the first quarter to the lowest level in 14 years, according to Miller Samuel. While the inventory of listed homes is up a third from the first quarter of 2022, the inventory is still about half of pre-pandemic levels, Miller said.
Many of the current listings are overpriced, making the number of homes available for sale even lower, the broker added. While demand is strong, wealthy buyers are being disciplined on price, refusing to pay peak prices in 2021 and early 2022, brokers said.
“Many properties that come onto the market are priced incorrectly,” Miller said.
Sales could pick up in the summer if more homes come on the market, brokers said.
“As we move into spring and start to move into summer, I think the market will get stronger,” Bourgard said.