New kids are on the block in the Hamptons, but the established heavyweights are still coming out on top.
More brokerages have set up shop Out East since the pandemic-driven frenzy, hoping to carve out their own slice of the billion-dollar real estate pie. But listings dwindled with rising mortgage rates in the second half of 2022, leaving the sales spike firmly in the rear view.
Competition in the luxury enclave is now more fierce than ever, and the brokerages finding a foothold are those mining their networks to drum up business.
“Our agents are out there creating inventory in a market that has been lackluster,” said Todd Bourgard, who heads Douglas Elliman’s Long Island, Hamptons and North Fork region. “In Covid, [business] came to you. Now you have to go out and get it.”
While fresher players showed some promise last year, the same five legacy firms defended their titles, according to The Real Deal’s latest ranking of residential brokerages in the Hamptons.
“I’m never afraid of a little competition,” Corcoran CEO Pam Liebman said of duking it out over less inventory. “I welcome the competition, and let the cream rise to the top.”
The rankings are based on both buy- and sell-side transactions over $1 million between June 2023 and June 2024, from publicly available listings and data provided by brokerages.
Douglas Elliman remained on top for the second straight year with $1.48 billion across 437 deals. Compass claimed second place, with $1.45 billion over 316 deals. Saunders, the only Hamptons-exclusive firm in the top five, claimed bronze status with $1.29 billion across 409 deals.
Corcoran finished in fourth place, with $1.17 billion across 307 deals. Sotheby’s International Realty finished in sixth place, with $673 million across 142 deals.
The top 10 brokerages by sales volume combined for more than $7.7 billion across 1,840 transactions in the period. The previous ranking, which counted all deals between April 2022 and April 2023, had sales volume from the top 10 firms totaling $10.4 billion.
“In Covid, [business] came to you. Now you have to go out and get it.”
Compass agent Jack Pearson said it was a “slow spring,” as consumers continued to wait for rates to drop. “I think we were a little stymied at the beginning of [2024],” he said while noting that he’s seen activity pick up around the start of July this year.
With a smaller pond to fish in, the agents still reeling in deals were the ones who know how to navigate the Hamptons market — and all of its quirks, according to Nanette Hansen, brokerage manager for Sotheby’s International Realty in the Hamptons.
“For a long time in this landscape, someone could just do this as a hobby,” she said. “Those days are gone.”
Small but mighty
Though legacy firms largely dominated the top of the rankings, others earned their own places among the Hamptons honchos.
New to the rankings is the Modlin Group, headed by one of Manhattan’s leading brokers. Adam Modlin’s firm debuted in the Hamptons in December 2022 with top broker Christopher Covert and his team working in the market. The brokerage closed just over $100 million in sales volume across just nine deals, landing it the No. 10 spot in the rankings.
The smaller shops also have their advantages in a market slowdown, according to Preston Kaye, co-founder of Hedgerow Exclusive Properties: Having fewer agents allows boutique firms to be nimble and collaborative, giving them an edge over competing brokerages juggling more moving parts.
“It’s always much easier for our firm to make adjustments and be creative, certainly much more so than big-box firms,” Kaye said. “We can zig and zag when the market shifts.”
Kaye also counts the firm’s book of off-market listings as a boon to his business. The private deals are not included in the rankings, but brokers claim they are making up a significant share of the market.
Kaye’s brokerage, which finished eighth in the rankings with almost $262 million in closed deals, is sharing the most expensive listing currently on the market with the Modlin Group. The sprawling East Hampton estate, owned by Ann Tenenbaum, venture capitalist and widow of private equity titan Thomas H. Lee, hit the market in June with a $120 million asking price.
While $100 million sales are on the rise across the country, Bespoke co-founder Cody Vichinsky said he’s not expecting to see an abundance of nine-figure sales this year. Most of the waterfront properties, usually the ones to fetch the highest prices, have traded in the last 20 years, meaning fewer sellers are ready to offload unless they’re able to score their ideal price.
“We’ve gone through quite a bit of [buyers with] hungry appetites,” said Vichinsky, whose firm notched $808 million in sales and placed fifth in the rankings. “Everybody who owns these types of assets, unless there’s a death, divorce, distress or whatever it is, they can afford to hold it. The motivation to sell those types of assets is at a low.”
Big properties, big discounts
Several of the top deals from the past year came with discounts, but none more so than Southampton’s beleaguered La Dune estate. The mansion, which closed for $88 million in March following a January auction, sought $140 million when it listed in 2016.
The seller, Canadian art magazine publisher Louise Blouin, entered both homes on the estate into bankruptcy court amid a protracted foreclosure battle, including with a lender of a $26 million mortgage. Over four years, the balance ballooned to $40 million.
Auctions are “extremely rare” in the Hamptons, said broker Geoff Gifkins, a regional manager at Nest Seekers, which placed ninth in the rankings with nearly $156 million in sales.
While the property traded for $88 million, Gifkins, who at one time co-listed the property with Nest Seekers’ Shawn Elliott, said the seller only took home $78 million.
“People really need to read the fine print with auctions,” Gifkins said. “It’s a huge amount of money that’s coming out of somebody’s equity.”
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Even some of the top nondistressed properties had to take haircuts from their initial listing prices to close deals.
In August, 121 Further Lane, Jackie Kennedy Onassis’ East Hampton childhood summer home, sold for $52 million after asking $55 million three months prior. The seller, movie producer David Zander, had bought the 7-acre estate for $24 million in 2018. The compound, known as Lasata, features an 8,500-square-foot main house with eight bedrooms.
Three months later, another East Hampton estate, 201 Lily Pond Lane, sold for $45 million. In June 2021, the oceanfront property had been listed for the first time in 75 years, asking $69 million. The eight-bedroom, seven-and-a-half-bathroom home had once belonged to the late CEO and chair of St. Louis Union Trust, Eugene Williams, and his wife, Evelyn.
Philip O’Connell, who runs Brown Harris Stevens’ Hamptons branch, said the key to getting deals done this year was managing seller expectations.
“If the seller accepts their broker’s input, and they price it closer to comparable homes and pieces of land that have sold, there tends to be a lot of activity,” O’Connell said.
A rising tide
At this point last year, brokerages were eyeing potential interest rate cuts in the hopes of a fueled-up fall season. Fast-forward 12 months, and not much has changed.
Another year of mortgage rates hovering near their 20-year highs has only served to further shrink the pool of available property and turn broker’s sights to next year. Though most brokers are quick to paint a rosy picture, others are looking ahead with a healthy dose of caution.
“Obviously we’ve had some good news recently as it relates to rates, but I think everybody’s a little bit nervous,” said Joe Fuer, Compass senior managing director.
Inventory and contract signings have been up since the start of the year, and inventory levels now, which sit around 1,200, are nearly double what they were in 2022 (but still less than half of what they were pre-pandemic).
Given the sluggish nature of the last few years, Fuer said, transactions of certain property types may be heading toward some unseemly lows. Last year saw roughly 1,560 single- family home sales, and at the halfway point this year, that number was at around 650.
“Unless things pick up considerably, 2024 could be the lowest number of transactions of single-family homes sold in the Hamptons since 2009,” he said.
While sellers and buyers continue to play chicken over rates, the deals that do get done rely on some basic principles.
“If there’s value, and something’s priced properly, and it’s a great product, it’s going to move,” Fuer said. TRD
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