Don’t believe for a second that rising mortgage rates or economic uncertainty had much of an impact on the housing market in the Hamptons during the third quarter of this year. In fact, the median home price on Long Island’s East End increased 13 percent year-over-year to $940,000, according to a market report released today by The Corcoran Group brokerage.
The average price jumped 14 percent to $1.726 million, the data showed. The report is derived from a combination of sources, including internal data, and only factors in recorded transactions that actually closed between July and September of 2013.
In that time frame the real estate market stayed "uncharacteristically" active, as the third quarter typically represents a lull between the highly active second and fourth quarters, according to Ernie Cervi, an executive managing director in Corcoran’s Hamptons division.
“It’s very much like the high of the pre-crash market,” Cervi told Newsday.com in a phone interview. “To see an increase in average and median price of 14 and 13 percent, [respectively] is real strong.”
The high prices and active climate extended to all corners of the market. On the entry level, more homes were selling for seven figures than in recent years; on the high end, defined as the top 10 percent of all sales, the median price rose 29 percent on an annual basis to $5.75 million.
As for the recent report that the wealthiest of buyers are seeking out less opulent homes, Cervi said he “would strongly disagree with that observation.” Corcoran brokers have reported bidding wars on properties priced over $20 million and rising activity in the $10-million-and-up range. (The Corcoran Group did not specifically isolate this data.)
Moreover, Corcoran reported increased demand for land sales and a high level of interest in the growing number of multifamily developments, including the Watchcase conversion in Sag Harbor and Bishops Pond in Southampton. At the former, units are being devoured by luxury buyers who want the personalized service offered by the management, as opposed to having to maintain large homes of their own. While Cervi reported that Bishops Pond is attracting retirees and entry-level buyers with a $1 million starting price point.
“There’s really no indication that prices will go anywhere but up,” he said.
So is there any remaining opportunity left in the market? Cervi pointed to homes priced below $1 million that are already being targeted by investors and can be rebuilt or refurbished to yield significant profit.