Fiscal fears hurt Hamptons housing market
In the first quarter, sales of expensive Hamptons homes fell off the fiscal cliff.
Fear of higher taxes in 2013 drove a flurry of high-end house sales in the Hamptons at the end of last year. That front-loading of sales slowed down the top of the market in the first three months this year, experts said Wednesday, citing data from a report scheduled to be released Thursday by broker Douglas Elliman Real Estate and prepared by appraisal firm Miller Samuel Inc.
On the rest of Long Island -- excluding the Hamptons and North Fork -- housing inventory declined sharply in the quarter, according to the report. Houses listed for sale fell to 15,303 in the first quarter, down from 20,358 a year earlier, as homeowners wait to rebuild equity and see where prices head. Average prices rose in the first quarter to $435,082 from $415,243 a year earlier.
Hamptons houses sold for an average price of $1.2 million in the first quarter of 2013, down from $2.1 million in the previous quarter and $1.7 million a year earlier, the report said. The fall doesn't signal a decline in prices so much as a shift in timing, said Jonathan Miller, president and chief executive of Miller Samuel.
Buyers, Miller said, tried to close "by Dec. 31 because the general assumption was a tax environment would be higher in 2013."
Miller said 49 houses in the Hamptons sold for more than $5 million in the fourth quarter but only eight in the first quarter.
The so-called "fiscal cliff" threatened a mix of automatic tax hikes and spending cuts in 2013. Congress agreed to limit the tax hikes while increasing rates on the highest earners -- those likeliest to be worried about capital gains on the sale of multimillion-dollar homes.
While the average price in the Hamptons swung, the median price was more stable, falling to $740,000, a 5.1 percent drop compared with a year earlier.
"The top end of the market has taken a breather," said Douglas Elliman broker Paul Brennan. "Other than that everything is pretty normal."
Judi Desiderio, chief executive of Town & Country Real Estate, which publishes its own market reports, agreed that sales in the high end fell in the first quarter. "The greatest gain in activity was seen in the $2 million to $3.5 million range, it went up 41 percent," Desiderio said. "That's huge."