An elegant 5,500 square-foot home set on nearly four acres in Bridgehampton came onto the market almost exactly a year ago with an asking price of $21.9 million. After what Zillow shows is three price cuts, it’s down to $17 million and is still unsold.
One hamlet over, in Wainscott, a massive 10,000 square foot mansion on about 14 acres overlooking Georgica Pond hit the market last year for $70 million; its price was subsequently cut more than 14%, to just under $60 million. It also has yet to find a buyer.
The Hamptons Covid-era buying frenzy is a thing of the past. “It’s certainly not gangbusters like it was,” says Paul Brennan, a broker with Douglas Elliman. “Things have slowed down. There’s still lots of activity, but people are not pulling the trigger as quickly as they did a few months ago.”
May’s sales numbers were lackluster, according to an Elliman report, with new signed contracts for single family homes down 38% from last May, even as 14% more listings came onto the market. The numbers for June aren’t out yet, but analysts and brokers say it isn’t getting better.
“The market is transitioning,” says Jonathan Miller, president and chief executive officer of the appraiser Miller Samuel. “What’s happening in the Hamptons seems to be happening throughout the country.”
Buying Mindset
But unlike most U.S. housing markets, the Hamptons is mostly second homes which are bought, occupied, and sold by some of the richest people in the world—people who at least in theory can pay cash rather than worry about mortgage rates.
“The market out here is a little different than the rest of the country,” says Douglas Elliman broker Martha Gundersen, who represents the $60 million Georgica Pond listing. “A lot of purchases aren’t contingent upon mortgages, and [buyers] can always get private funding.”
And yet, even the richest buyers have tended to take out loans. “I find it’s at almost every price level,” says Corcoran broker Gary DePersia. “After the contract is signed, no matter what, they’re getting financing. They don’t want to take the money out from where they have it to buy a house.”
And so the end of cheap mortgages has, brokers say, begun to impact the spending habits of those who don’t need one.
“You have to feel very good about the world and your economic situation to go out and buy a second home, which very often can be more expensive than your first,” says DePersia. “It’s not so much about interest rates as it is about [buyers’] general feeling of well-being.”