Posted on Monday September 17, 2018 3:14 AM
by Joseph Kazickas No Comments »

It’s clear, though few speak of it, while everyone in the trade is slowly facing up to it, that the value of real estate in the Hamptons has been evaporating over the last year and a half.
The clearest evidence of this value erosion is found in the growing number of listed properties that have reduced their asking prices.
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reduced 4 Reducing an asking price, which in isolation doesn’t serve as a market barometer, speaks to an underlying current in the real estate market when it begins to occur broadly. The scale at which price reductions are occurring in the Hamptons is sending a clear message that the real estate market is undergoing a wholesale repricing. A repricing that is likely measured in the 100’s of millions of dollars to date, and that shows no signs of abating for the foreseeable future.
It may well be that some properties came to market at aspirational prices, and that hard market realities are forcing sellers to reprice but the fundamental reasons for this are oversupply and chilled demand. Spec construction in the luxury category has contributed to a glut of properties in the 5 to 10 million dollar price point. It’s even worse in the super luxury market where some speculatively built properties have been lingering on the market for years. Price reductions, however, are occurring across all price points, and not just for houses built on spec.
In the first two weeks of September, by my rough calculation based upon email notices sent to us by listing brokers, a minimum of 40 properties have seen price reductions totaling over $35 million which range from $15,000 to $13,500,000.
It’s clearly a buyer’s market. For sellers, tighten your seatbelts. A rough road lies ahead. For buyers, greater value is in your future, but don’t wait too long to move on a purchase.