As a result, Hampton’s summer the rental market at Hampton is poised for an unexpected recession this summer.
After two years of strong Hampton’s summer demand and rising prices, the supply of rental housing in the Hamptons grew. Prompting a wave of last-minute discounts. According to Jonathan Miller, CEO of Miller Samuel, as a result, average rents fell 26 percent in the first quarter. Realtors say some homeowners drop prices by 30% or more to fill their property.
“There’s a lot of equipment, and people don’t rent it,” says Enzo Morabito of Douglas Elliman. “And that’s across all segments, from the lowest to the highest.”
The weakness marks a dramatic and rapid turnaround for one of the country’s most expensive and desirable real estate markets. In 2020 and 2021, tenants struggled to find summer rentals. Paying record prices months before the season for fear of missing out. Now realtors say there are hundreds of leases left for the summer.
Morabito says it’s a beach rental asking for $70,000 a month, but potential tenants are only offering $45,000.
“We expected the tenants to share the differences, but now the market is different,” he said. Brokers said lower demand was partly due to increased travel. Wealthy New Yorkers who have spent the last two summers cooped up in the Hamptons plan to travel to Europe and other states this summer as Covid begins to retire. However, other European and international tenants have not returned to the Hamptons.
The war in Ukraine, rising inflation, and falling stock markets could also weigh on elite summer spending plans – especially. As the Hampton market is closely tied to Wall Street’s fortunes.
“There are a lot of questions in the air about the economy. Both local and national,” said Harald Grant of Sotheby’s International Realty. “Everything affects the market.”
The Hamptons could also feel the opposite of recent price increases. May’s average rents have been 46% since May 2019, before the pandemic. So even though the rich still have plenty of money to spend, they may resist high rents, especially given the economic outlook.