"RESIST" BIG HOUSES--IS THIS A TREND??
Just recently, I had a conversation with one of my buyers regarding how big a house she wanted to buy...she really didn't know how big, but she wanted "BIG".
She says that her friends all had these huge houses and she didn't want to appear like she skimped when she was spending or selecting her Hamptons home.
I showed her several new houses that were around 4000 SF but she was resisting those....So I took her to the next available size up in price and square footage: A 5000 SF house with a finished basement of about 1200 SF. She reacted to it in a surprising way---at least I thought it was surprising given that she was so sure she wanted a really big house. It was also located in a less than desirable area ("North of the Highway") for her so it was a stern "no" when it came to whether she was interested or not.
INTERIOR DESIGNER DILEMMA
Her attitude was one of shock at how large the rooms seemed in a 5000 SF house---she was concerned with what she would put in those rooms to make them "warm". I told her that an interior designer would know what to do and she told me that she did not want to use an interior designer since she had always decorated her own homes--those houses were in Manhattan and Florida.
When we went back to the 4000 SF house that I had showed her on the first go-around she took a new look at it and became more interested in it since it was right in the Village which is her first location choice.
TROPHY HOUSES LESS IMPORTANT?
This was not the first time I have had this kind of experience with a buyer. There are more than a few looking to buy reasonably sized homes---some even say the 4000 SF house is too big for them. And if there is a finished basement to boot, it puts an end to the showing entirely.
There are still many buyers who come here for the "Trophy" house; the house that they "need" to impress their circle of friends. It is not something that I can say all buyers are driven by but there are large enough numbers so that we, as agents are aware of the "competitive" house syndrome. The need to impress friends is always a subtle one---rarely ever spoken of but it happens to be a big factor here in the Hamptons where more likely than not, the buyer is from Wall Street and there is a deep rivalry for having the biggest and the best house in the Hamptons!!
Now, with all that I have seen in the past 6 months, I would say we have seen a change. It is not an obvious one because there are still a few $30M+ houses selling and the $4M to $6M market is still sizzling but all in all the smaller more affordable house is where the bulk of the sales are coming from--$under $1M and then the $1.5M to $3M is the best selling part of the market here. There is also a change in location desirability.
"SOUTH OF THE HIGHWAY" HAS LOST SOME OF IT'S DRAW
When buyers came to the Hamptons to buy in the past there was always the request to see only "South of the Highway" houses. This means that the ocean is the big draw and the buyer is willing to pay more for these houses that are a walk or a bike ride distance away.
No longer do we see high demand with the pull of the ocean--"North of the Highway" is just fine, thank you very much! But the real reason, I believe is that prices have gone so sky high South that people no longer put a request in for "Only South Of The Highway Please"!
The house shown at the top of this post is a brand new 5000 SF house with a finished lower level but the price is a reasonable $3,995,000 on 2.32 acres--Oh, and I forgot to mention, it is North of the Highway! It will be ready for summer 2018 occupancy and that is what buyers are looking for right now.
The Village of Southampton (South Of The Highway!) has become overpriced to the point that the average buyer can not afford to buy there. This is a tough situation and until prices adjust more realistically it will continue for the foreseeable future.
A SIZZLING MARKET: LOWER INVENTORY MEANS FEWER SALES
We had another record quarter--the 4th quarter of 2017 hit another milestone. The average price sold in Southampton Village last quarter was $4,292,500! Of course there were 3 houses sold over $30M so that impacts the average price in a major way.
The total volume for Southampton Village in Q4 was over $145 million in sales--105 more houses sold in Q4 of 2017 over 2016--a 36% jump and about 43% more in sales volume! This is already affecting our sales for Q1 of 2018--slower moving houses are what is left to sell and the buyers are only willing to buy those if the price comes down even more than it has in the last 6 months! New listings are hard to come by--if they are priced right, they sell immediately but the sellers are waiting to see if they can get more for their home if they wait a bit--to see what the new tax law does to the housing market as a whole.
What are you finding in your market place? Are prices still going up ?? How about the size of houses---Is that still going up as well? Please reply below in a comment:
**ALL INFORMATION AND CONTENT IN THIS BLOG IS ORIGINAL TO PAULA I. HATHAWAY. The views expressed herein are my personal views and do not reflect the views of Douglas Elliman Real Estate
Paula I. Hathaway, Senior Broker Associate, Douglas Elliman Real Estate
Southamtpon Village Real Estate Specialist since 1995; Also Specializes in North Sea, Noyac, Water Mill and Bridgehampton, New York
Diamond , Gold and Chairman's Circle Awards; Top Producer since 2005
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