- The real-estate market in the Hamptons, the ritzy vacation playground of New York City’s wealthiest residents, is suffering.
- The median sale price of a Hamptons home has fallen to a seven-year low of $US860,000, according to a 2019 Q1 report from Douglas Elliman Real Estate.
- And, as Oshrat Carmiel reported for Bloomberg on October 24, there are more luxury homes currently sitting on the market than at any point since at least 2011.
- This slump can be traced, in part, to Donald Trump’s 2016 federal tax reform, which makes it more expensive to own luxury homes.
- Most buyers of homes that cost $US10 million or more already own homes in the Hamptons and other potential buyers are instead looking north to the Hudson Valley and the Catskills.
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The luxury real-estate market in the Hamptons, the favoured vacation destination of New York City’s wealthy elite, is suffering.
Home prices are plummeting and high-end properties are lingering on the market for months, The New York Times reported earlier this year. The median sale price of a Hamptons home has fallen 7.9% to $US860,000, according to a 2019 Q1 report from Douglas Elliman Real Estate, which puts Hamptons home sales at their lowest levels in seven years. And there are the most luxury homes on the market since at least 2011, Oshrat Carmiel reported for Bloomberg on October 24.
This high-end real-estate slump can be traced, in part, to Donald Trump’s 2016 federal tax reform, as the Financial Times’ Ben Foldy reported. The new tax laws make it more expensive for homeowners to own luxury homes because they can deduct only $US10,000 in state and local taxes from their federal income taxes.
“The high-end of the Hamptons housing market continued to move slower [in the first quarter of 2019] in the aftermath of the new federal tax law,” the Douglas Elliman report reads.
The most expensive homes for sale in the Hamptons are suffering the most, Laura Brady, president and founder of Concierge Auctions in Manhattan, told The Times. The priciest homes sold in the Hamptons in 2018 sat on the market for an average of 706.7 days before finally selling, according to a report from Brady’s company.
Many high-end home buyers already have places in the Hamptons – or they’re looking elsewhere
Part of the problem is that the wealthiest buyers – those looking at homes priced at $US10 million or above – have already owned homes in the Hamptons for years, according to Zachary Vichinsky of Bespoke Real Estate.
And other luxury buyers who might have previously bought in the Hamptons are instead looking north to places like New York’s Hudson Valley and the Catskills, where prices are more affordable and buyers value the proximity to Manhattan, outdoor activities, and stunning landscapes, as Business Insider’s Madeline Stone reported in 2017.
“The lower Hudson Valley is certainly easier to get to than the Hamptons,” Richard Ellis, owner of Ellis Sotheby’s International Realty in Nyack, New York, told Business Insider at the time. “People who buy on our side of the river are not ‘keeping up [with] the Joneses,’ so to speak. They’re looking to impress themselves, not others.”
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