Northfork Properties

The Area’s Most Popular Pastime

 
Posted on Tuesday April 19, 2011 9:45 PM
by Joseph Kazickas 2 Comments »

We were recently offered the email addresses of 1,300 real estate agents, mined from their company websites, who operate in the Hamptons real estate brokerage industry. You can’t label the real estate industry as our local economy’s largest employer as, technically, real estate agents are independent contractors, eating only what they kill. The numbers suggest, however, that real estate is the region’s dominant occupation, if not pastime. By far.
Of course this caused us to start thinking… that’s a lot of people. How many of these 1,300 actually make a living in the real estate business?
Only a small handful of agents operate at the market’s highest echelon,  generating hundreds of thousands of dollars, if not millions, for themselves on a consistent basis. That leaves the vast majority of agents competing for the crumbs. And if the adage is true, that 80% of sales are generated by 20% of the salespeople, then the thousand or so agents who aren’t generating 80% of the total commission dollar cannot help but find it a tough go. For most, real estate must primarily be a way of earning extra income, rather than making a living, all the while hoping for the big deal that makes the work worthwhile.

Here’s the data…

For the 12 months ending December 2010, 1,986 properties changed hands, representing $2,829,000,000 in value, in the Towns of Southampton, East Hampton, Shelter Island and Southold.

Of that value an estimated 25% is non-commissionable, not involving a broker. This leaves $2,121,750,000 in commissionable deal value. An average commission rate of 5% results in $106,087,500 to be split between the agent and his broker. Assuming the agent shares 60% of that gross commission, we are left with about $63 million to be divided among 1,300 equally performing agents, or, $48,000 in commission income for the year, per agent. Hardly enough to support even a modest Hamptons lifestyle.

But what about that adage, that 20% of the agent pool accounts for 80% of the deal value? It gets grim at this point.

The calculation results in an average commission of $20,401.00 distributed to each of the hapless 80%.

It must be then, that most real estate agents in the Hamptons use their real estate license to supplement their income, not depend upon it for a livelihood. And this raises questions that we’ll address in a future post.

(Market data provided by Suffolk Research Service, Inc.)


After Hours

 
Posted on Saturday April 16, 2011 3:27 AM
by Joseph Kazickas No Comments »

Where in the Hamptons do the real estate industry’s Power Players rub elbows? Try the Meeting House in Amagansett. Recently seen…Martha Gunderson (BHS), Ed Petrie (Sotheby’s), James Young (Rosehip), Susan Ryan (Corcoran), Lee Minetree (Saunders), among others. But the star has to be Bill with his signature Negroni…

Bill at work. Putting things into proper perspective.


1st Quarter Market Report

 
Posted on Saturday April 16, 2011 2:21 AM
by Joseph Kazickas No Comments »

Eastendlistings.com recently released market data for the 1st quarter 2011 with a somber rejoinder, “Not good news.” But the report deals with past, not current, activity. Based upon our observations it may not be so bad today as recent history suggests it might be. Read the report here.


LIBOR – Advertising on Local Radio

 
Posted on Thursday April 14, 2011 1:48 AM
by Joseph Kazickas No Comments »

Here’s an interesting one. The Long Island Board of Realtors takes an initiative. More later…


The Challenge of Data Integrity

 
Posted on Thursday April 14, 2011 1:29 AM
by Joseph Kazickas No Comments »

The rental season is approaching it’s peak. It is a time when the availability status, and pricing, of rental properties changes by the minute, creating frustration among all stakeholders. From the broker who spends valuable time confirming the accuracy of the data available to him, to the homeowner frustrated by multiple calls from agents asking the same thing, over and over. And, finally, to the consumer who, when confronted with conflicting information on the Internet, doesn’t know what to believe.

It seems that 20% of the transaction value, rather than the customary 10%, would be a fair price to pay for a solution to this perennial problem.

Where’s the solution? The solution lies in a clearing house structure accessible to the the focus point of both the consumer and the real estate agent, namely the homeowner. Only the homeowner possesses the knowledge that can put an end to the chaos in a market hyper-critical to the Hamptons real estate industry.

Rosehip Partners has risen to the challenge with it’s website, hamptonsrentals.com, an interactive Internet destination that offers owners, brokers and tenants a viable solution.

Everyone benefits from good data integrity. And it doesn’t have to come at 20%. In fact it’s free.


Press Newspaper Group Update

 
Posted on Sunday April 10, 2011 1:30 AM
by Joseph Kazickas 1 Comment »

We are 100% convinced that George Simpson would wish for his campaign against our friend Joe Louchheim be advanced. And so, in everyone’s interest, we’ll indulge him. Check it out. But George, bringing the kid’s into it might be setting a new low.


Rental Update

 
Posted on Sunday April 10, 2011 1:05 AM
by Joseph Kazickas No Comments »

If you are looking for a rental it’s almost past time to get off your lazy butt. We have a wonderful new client with a great strategy…
June is a wash month. With a little work you can find a June rental for a fraction of it’s MD/LD cost. Our client hopes to find a July/LD after securing his early season rental, at a huge discount to it’s season (MD-LD) value. But good luck for the rest of the summer.
Inventory is being quickly consumed. Rosehip Partners, with our innovative website, hamptonsrentals.com, isn’t the only company doing deals. You can save money in the short term, but for the balance of the summer you might find yourself re-thinking a great plan on paper, while steaming away your weekends in Greenwich.


Where, exactly, does she stand?

 
Posted on Saturday April 9, 2011 12:50 AM
by Joseph Kazickas 1 Comment »

Our friend, and owner-manager of one of the larger local brokerages, respected and admired for her brains and acumen, throws us for a loop. Her firm, with offices throughout the area, draws a line at the Shinnecock Canal. She, as well as the other major real estate operators on Long Island’s East End, have structured their firms to take advantage of MLS where it is embedded, and to evade it where it isn’t. So when we recently spoke with her about hamptonsproperties.com, a website committed to information flow, we became concerned that it was so easy for her to take a conflicting position when it came to the best interests of her clients.
In today’s real estate market, regardless of values, or location, every tool should be used to promote and sell. But hoarding the high end, to the detriment of the median by not using the MLS tool, is shameful. One shouldn’t worry so much about making money that they should find themselves speaking with forked tongue.


Catching up…

 
Posted on Sunday April 3, 2011 4:36 PM
by Joseph Kazickas No Comments »

It doesn’t happen often.

Like tsunamis don’t happen often.

But every so often you see something really memorable in the real estate business. And this listing is one of them. At $55 million it speaks volumes about it’s owner.

The Master Bath

Now here's an Entry Hall

Make yourself at home!

The guest house to the left (west)? Available separately for $20,000,000...

Interested? Please contact Rosehip Partners for further information.


Wainscott Oceanfront – Catching up with Ed Petrie

 
Posted on Wednesday March 30, 2011 1:34 AM
by Joseph Kazickas 2 Comments »

It was a beautiful, but crisp, day. More October than March. But hope was in the air so I decided to pay a visit to my friend and former Dunemere partner, Ed Petrie who was hosting an open house at his newest listing…a $55 million Wainscott oceanfront estate. What better way to kill half an hour…