The conversations at many local Memorial Day parties, events and BBQs covered many topics from the weather to real estate. The rule of thumb is never talk religion or politics at social gatherings but know your latest real estate statistics.
The east end real estate market is flexing its muscles right now. By definition, flexing means bending. While interest rates rise and the stock market and bitcoin speculation are waning, east end homes remain stable as a strong hedge against inflation as well as the east end historically being a wonderful place to own a home.
Statistics coming out via websites are of a once smoking hot market cooling down to pre-2019 activity.
The usurpation market of the Covid-19 panic is now returning to the basic fundamental that has always made owning east end property wise. As Kevin O’Connor, CEO of Bridgehampton National Bank, said in an interview back in the panic of 2008-2009, “As long as the ocean is right there (as he pointed towards the ocean from his Bridgehampton office), the east end real estate market will be alright.” The ocean is still there.
The east end “Community Preservation Fund” numbers (CPF) based on a tax of the volume of sales dollars will definitely be lower the next few quarters versus last year, but that’s to be expected considering the huge volume of homes sold in the last year, with some reports putting it over $10 Billion. Still, the smart money is thinking owning real estate is the best move with rising inflation and interest rates. The only problem is that you must purchase quality real estate, and that is the hiccup presently.
Judi Desiderio, CEO of Town and Country, was quoted as saying, “All Hamptons real estate sells when priced correctly.” The problem sometimes is getting the seller to market their home realistically. The frenzied movement upward, almost panic mode, is over. GWU Business Professor Peter Carrington always preached, “…markets always correct themselves but are like a pendulum swinging back and forth to extremes.”
That doesn’t help the folks who only bought east end real estate short term to realize the crazy immediate profits of the last 18 months. They have to be rethinking their investment strategy. Yet, real estate has always been the best long-term investment in the U.S.A. since 1626, when the Dutch paid $24 worth of “trinkets,” for all of Manhattan Island.
That was 13 years (1639) before Lion Gardiner started the Hamptons real estate market when he purchased Gardiner’s Island from Montaukett chief Wyandanch; Gardiner reportedly paid by trading, “a large black dog, some powder and shot and a few Dutch Blankets,” (according to a Book by Gardiner, Curtis, Crane in 1890 titled, “Lion Gardiner, and his descendants.”)
The obvious point being that real estate is still king, extremely long term. It is bending as it always does but never breaks.
