In post-season Hamptons, high-end listing prices get slashed by millions

New York /
Oct.October 06, 2010 12:30 PM

Real estate pros say seasonality and market-wide corrections are to blame


From left: an East Hampton mansion that saw an 11 percent price cut to $35 million; a Water Mill property that took at 14 percent price cut to $30 million; Susan Breitenbach and Peter Turino

As the warm weather winds down, so do the prices on some of the Hamptons’ most expensive listings, while agents there slash asking figures to ratchet up post-season interest.

Roughly 20 out of about 250 of the Hamptons’ most expensive listings currently on the market have reduced their asking prices by 10 percent or more in the last month alone, according to Streeteasy.com, including one Meadow Lane home in Southampton that slashed its asking price last month by $4.1 million, to $26.9 million, a 13 percent decline.

Industry experts say the trend is both seasonal and related to market corrections.

“It does come with the seasons. People start to reduce the prices in the wintertime,” said Janet Hummel, a partner with Town & Country Real Estate on the East End. But, “this year there seem to be more [price cuts] and a higher price reduction.”

Hummel said that her firm has seen price reductions of $2 million and $3 million on a couple of its higher-end Southampton listings. She hopes these jaw-dropping reductions will draw some attention.

“That makes people stand up and take notice,” Hummel said, noting that with particularly pricey listings, “a $100,000 cut doesn’t make much of a difference.”

Of course, some agents are seeing much steeper cuts as they enter the colder months.

This week, Beate Moore, a senior vice president with Sotheby’s International Realty, chopped one of her East Hampton listing’s asking price by $4.5 million, or 11 percent, to $35 million. The listing is a co-exclusive with Brown Harris Stevens and the Corcoran Group. Moore said such a big price cut is not uncommon today.

“Almost all my listings are coming down in price… the numbers were so high for so long,” Moore said, lamenting the “year-and-a-half when people weren’t budging.”

Last month, Susan Breitenbach, a senior vice president with the Corcoran Group based out of its Bridgehampton office, knocked 14 percent — roughly $5 million — off a spec mansion at 674 Scuttle Hole Road in Water Mill, bringing its asking price down to $30 million.

The impulse to reduce prices and shed inventory before the holiday season is there, Breitenbach said, although she said that there might be something more to the price cuts she’s seeing in the high-end market.

“People are being a little bit more realistic,” Breitenbach said. “It’s a different world than it was in 2007. I think everyone realizes prices aren’t jumping back to that point.”

Peter Turino, a principal broker in Brown Harris Stevens’ East Hampton office, puts the blame squarely on the changed economy.

“The recession has forced us to come to grips with disparities between the asking prices and perceived real property value,” said Turino, who noted that “many” of his listings have recently been reduced.

And real estate appraiser Jonathan Miller suspects Turino isn’t alone this time of year.

“It wouldn’t surprise me that you would see a higher level of price reductions at the top of the market [when] we’re at the end of the summer,” said Miller, CEO of Miller Samuel, noting that the market is still trying to adjust to new fiscal realities. “You have people who are resetting their listing price. In this market, you do tend to see higher spreads between ask and sell.”

 

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