E. Hampton called retiree investment hot spot
Let's say you're looking to buy a home in the next housing hot spot, a place poised to attract retiring baby boomers.
You might consider Naples, Fla.; Sun City, Ariz., or -- East Hampton?
Unlikely as it may seem, the exclusive village made a list of the top 15 retirement hot spots for real estate investing, released Thursday by RealtyTrac, a national data provider.
East Hampton's gracious mansions are occupied by such luminaries as Martha Stewart and Steven Spielberg. The 5-square-mile village's year-round population of about 1,100 can swell to 10,000 on steamy weekends in August. With a median home price of just under $1 million, according to RealtyTrac, the cost of living is unsuitable for many senior citizens on fixed incomes. Its winters are less than balmy.
East Hampton's appearance on the list "was a surprise," said Daren Blomquist, vice president at RealtyTrac. "It's one of those retirement hot spots that's not going to be for the masses but for a select group of folks who can afford the type of retirement lifestyle that comes with living in the Hamptons."
RealtyTrac compiled its list by taking municipalities where at least one-third of the population is age 65 or older, and limiting the tally to towns where it would be profitable to own and rent out an investment property. Lastly, the firm sorted the list by the year-over-year growth in home prices and chose the top 15.
Of the 15, seven are in Florida.
East Hampton ranks last by price appreciation, with an 8 percent gain from May 2012 to May 2013. The village also ranks last for profitability, with investors expected to make a 2 percent annual return on rents after expenses, RealtyTrac reported.
The village has its charms for many retirees, said administrator Larry Cantwell, 62, who plans to retire at the end of July and is running for town supervisor. "The media's image of East Hampton is oftentimes much different from what it's like living here on a year-round basis," Cantwell said. "The fall is the best time of year -- it does quiet down, and yet the weather is fantastic."
Plus, with so many vacation homes, the village has lots of taxpayers and few schoolchildren, which keeps a lid on property taxes, Cantwell said. The owner of a $1-million home would pay about $10,000 in property taxes, Cantwell said.
Many retirees in the village started out as summer visitors from New York City who made East Hampton their primary residence upon retirement, spending winters in the Carolinas or Florida, Cantwell said. With some of the world's most beautiful beaches, along with the Guild Hall performing arts center and the highly regarded links at the Maidstone country club, Cantwell said, "if you enjoy the outdoors and have an active lifestyle, this is a terrific place to be."