The Hamptons’ “middle class,” comprised of New Yorkers with modest million-dollar second homes back East, have cut their asking prices by nearly 30 percent to sell their homes.
Due to rising interest rates and the need to be in town more often after the pandemic, many mid-sized Hamptons vacationers who own properties worth up to $5 million are looking to sell their homes at discounted prices.
In some cases, owners in Sag Harbor and Amagansett have reduced their asking prices by hundreds of thousands of dollars.
An agent told this NYPost that prices for houses at the lower end of the spectrum are falling. They said, “We’re not talking about the super-rich here – these people are subject to economic norms.”
The price of this Sag Harbor property, currently on the market for $2,395,000, has decreased a total of 28 percent since March 2023
“When it comes to owning a vacation home, it’s just not that easy to justify the cost.”
The sudden increase is thought to be linked to peaks during the pandemic, when buyers paid double for homes in the East, and have now calmed down.
With no widespread work-from-home rules in place and people being forced to return to city offices, many who have second homes are finding it difficult to justify maintaining that residence.
The source said: “I know a lot of people who are turning their remote offices in the Hamptons back into bedrooms and putting them on the market.”
According to Zillow, the price of a Sag Harbor home currently on the market for $2,395,000 has decreased a total of 28 percent since March 2023.
Previously, the six-bedroom, six-bathroom Hamptons home with a private pool was listed for $2,750,000.
Located in scenic Sag Harbor, the home is described as a “unique investment opportunity” for a buyer looking to give it “some TLC.”
There is a spacious 3,285 square foot main house with five bedrooms and three and a half baths, as well as a one bedroom, one bath apartment suite with a private entrance for visiting guests.
The listing on Zillow reads: “On warm summer days, take a dip in the inviting Gunite pool, shoot some hoops, or enjoy the proprietary, dock-only beach that is the gateway to Long Beach and its breathtaking Peconic Bay sunsets.”
“This is a golden opportunity.” “With a proven track record of generating income from long-term and short-term rentals, this property offers incredible potential.”
Despite the significant cut, the home is still on the market.
Even in luxurious Amagansett, New York, the asking price for a three-bedroom home was reduced by 23 percent in the last month alone.
On October 1st, the stunning property was listed at $1,795,000 – but by October 24th that value had been reduced to $1,395,000.
This Sag Harbor property is currently listed for $2,800,000, a 12.5 percent decrease from the asking price since the summer
On August 18, this home was listed for $5,700,000, but that was reduced to $4,995,000 a month later in September – a 12.4 percent decrease
The beach house overlooks the waters of Napeague Bay in Amagansett’s hidden gem Lazy Point.
Buyers can “enjoy majestic sunsets and spectacular sunrises with views all the way to the Connecticut shores from this charming home that exudes the peace and tranquility of a bygone era.”
The listing adds, “The home features three bedrooms, a full house generator, central air conditioning and sits on a scenic 0.38 acre double lot.”
Another Amagansett home has significantly lowered its asking price in recent months to get off the market.
On August 18, the price was listed at $5,700,000, but this was reduced a month later in September to $4,995,000 – a decrease of 12.4 percent.
The five-bedroom, seven-bathroom property is located on a private, quiet cul-de-sac and is just moments from the ocean beaches.
The living room features an 18-foot ceiling and a double-sided gas fireplace shared with the dining room – on private, lush grounds with a 20′ x 40′ gunite pool.
In luxurious Amagansett, NY, this three-bedroom home has seen its asking price reduced by 23 percent in the last month alone. On October 1st, the stunning property was listed at $1,795,000 – but by October 24th that value had been reduced to $1,395,000
The Waterfront property in Sag Harbor has reduced the price by 23.9 percent since October of last year — and it’s still on the market
On September 7, another typical home in Sag Harbor was listed for $3,200,000 – but within six weeks the asking price dropped 12.5 percent to $2,800,000.
Zillow described it as having “classic charm and modern comforts,” including an open floor plan, top-of-the-line appliances and four bedrooms.
Outside there is a “beautifully landscaped backyard with a spacious patio overlooking the heated pool.”
This emerging trend comes after a former Oppenheimer analyst who has been dubbed the “Oracle of Wall Street” predicted that home prices will fall for the first time in a decade.
Meredith Whitney is known for producing an incisive research report highlighting the risks Citigroup took before the financial crisis.
But as alarm bells ring again about the health of the U.S. economy, Whitney told Insider she’s not afraid of another recession, thanks to robust consumer spending supported by low unemployment rates.
Instead, she is focusing on American housing prices, which she expects to fall for the first time in over a decade. According to CoreLogic, this represents a significant reversal of a pandemic-related trend that has seen property values increase by 42 percent since March 2020.
She predicts that Pennsylvania, Connecticut, New Jersey and Illinois are at greatest risk of falling prices due to migration trends.
According to the S&P CoreLogic Case-Shiller US National Home Price Index, these are the five cities where home prices have risen the most and the five where they have fallen the most
However, Texas could be doing much better after seeing a huge influx of California residents in search of a cheaper cost of living.
She said, “It’s country specific.” And so I expected that to happen. With more than 10 years of data – 12 years – I can now look at it and know that it actually happened and is happening.”
But trends in the current climate have shown otherwise.
U.S. home prices rose for the seventh straight month in August, hitting a record high, according to new data.
Prices rose 0.9 percent in August from the previous month, according to the S&P CoreLogic Case-Shiller US National Home Price Index – the leading measure of U.S. home prices.
That means real estate rose 2.6 percent year-over-year, the Case-Shiller data showed.
According to government-backed lender Freddie Mac, mortgage rates are at their highest in several decades – with the average 30-year fixed rate at about 7.79 percent.
Rising mortgage rates and historically low inventory levels have continued to push home prices higher in most of the country’s 20 largest cities.
According to the Case-Shiller 20-city composite, 12 cities saw average home prices increase in the year ending August 2023 compared to the year ending July 2023, while seven saw prices decline and one remained unchanged.