Hamptons house prices jump 50% in late 2020 as New Yorkers flee city

Home sales in the Hamptons ended 2020 at a 15-year high, in a seller’s market fueled by wealthy New Yorkers fleeing to the affluent enclave.

The Hamptons registered 803 home sales during the fourth quarter, double the number from the prior year and the fastest pace since 2007, according to a report from Douglas Elliman. 

The median sales price for homes in the Hamptons surged 55 percent, to $1.4 million, driven by a shift toward luxury mansions.

It comes as New Yorkers fleeing rising crime and pandemic concerns in the city increasingly look to the Hamptons as a year-round residence rather than a summer retreat — but experts warn than as vaccines become widespread the trend might not continue. 

Surging sales and falling listing inventory in the Hamptons have spurred furious bidding wars.

‘Probably 30% to 40% of listings have gone into bidding wars,’ Hara Kang of the Hamptons-based Atlantic Team at Douglas Elliman, told Mansion Global.

‘After one week we’ll have three to five offers bidding for a property. It’s not a great time to be a buyer, but it’s a fantastic time to be a seller,’ said Kang.

Real estate agents, perhaps desperate for more inventory, are urging Hamptons homeowners to cash in on the trend while it lasts.

‘If I were a seller, there really is no better time to sell than I can possibly imagine,’ Ginger Thoerner of the Clark + Thoerner Team with Sotheby’s International Realty in the Hamptons told Mansion Global. 

‘I’ve never seen a more frenzied market—we saw around $5.5 billion in sales in 2020, more than 2018 and 2019 combined,’ said Thoerner.

It comes after New York City’s real estate market suffered one of the worst years in recent memory, with property sales plunging 46 percent in 2020.

Pandemic restrictions, rising crime and the opportunity to work remotely drove many New Yorkers to flee the city. But with the vaccine rollout underway, there are signs the trend is starting to reverse.

In January, total property sales in the city surged 38 percent compared to last year’s level, according to the Real Estate Board of New York (REBNY).

Residential sales volume in the city increased 77 percent in January from the same month last year, to $3.2 billion the tread group said. That represented a 5 percent increase from the previous month. 

The surge in property sales brought an infusion of $190 million in tax transfer revenue to New York City and state, a 31 percent increase from the same month last year. 

The real estate industry generates more than half of New York City’s total annual tax revenue, while personal income tax accounts for just one-fifth of tax receipts.

Desperate to plug the state budget gap, Governor Andrew Cuomo has demanded a $15 billion federal bailout from President Joe Biden’s new administration.

In an ultimatum, Cuomo has already threatened to sue if Washington does not deliver the funding he is requesting. 

Mayor Bill de Blasio has also called for federal funds to make up for the tax shortfall, and REBNY President Whelan echoed the appeal. 

‘It is critical that elected officials stay focused on continuing this momentum by delivering additional federal aid, ensuring successful vaccination and rapid testing efforts, and demonstrating leadership with policies that promote job creation, private sector investment and good quality of life for all residents,’ Whelan said. 

‘As New York City continues to face significant challenges, tax revenue generated by the resurgence of real estate market activity will play a central role in driving the City’s economic recovery and funding basic government services that millions of New Yorkers rely on,’ said Whelan in a statement.