If only Long Island could grow a little bit longer, home prices in the Hamptons might finally come down.
Until that happens, or there’s some unforeseen shift in the economy, there doesn’t seem to be much flexibility: A scarcity of available homes continues to drive up prices even as sales slow, according to a third-quarter market report for Douglas Elliman by appraisal firm Miller Samuel.
“This is a national condition, the Hamptons and North Fork are not unique in this regard,” said Jonathan Miller, the report’s author.
In both markets, prices have risen to record or near-record highs for at least eight consecutive quarters while the number of sales has fallen year-over-year for five consecutive quarters. Homes are selling at a record pace, and bidding wars approached all-time highs.
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Homes in the luxury segment, though defined differently for each market, accounted for a record share of sales in both. Some 17 percent of homes sold on the North Fork went for at least $2 million, and 13 percent of homes sold in the Hamptons went for $5 million or more.
Inventory was the one differentiating factor between the two markets: While supply continued to thin in the Hamptons, it actually rose on the North Fork, a trend Miller said he expects to continue.
“As the Fed beats the economy with a baseball bat, there’s certainly potential for some uptick in inventory in the Hamptons as well,” he said.
The median sales price in the Hamptons was $1.6 million, up 23 percent from last year. Listings fell 3 percent year-over-year but were up 17 percent from the second quarter. Sales fell to 333, a 24.5 percent quarterly decline and a 16 percent dip from the third quarter of last year.
Miller cautioned that annual declines in home sales aren’t as significant as they look, since they’re skewed by last year’s abnormally hot market. A September cyberattack that locked down Suffolk County websites did not harm the integrity of the report, as Miller Samuel collects its data from Long Island multiple listing services as well as public records.
“If anything, it’s possible there were more sales than we captured,” Miller said. “For sale by owners, for example … that’s going to be a small amount, but if anything it just makes sales higher.”
On the North Fork, the median sales price rose to $979,500, an increase of 22.4 percent year-over-year and the second record-setting quarter in a row. There were 110 sales, down from 190 in the same period last year. Inventory rose to 161, up from 124 a year ago, but Miller stressed that it’s still historically low.
“Even rising nearly 30%, inventory is still two-thirds lower than pre-pandemic,” he said.