The Hamptons may pose as a world away from the metropolis 100 miles to its west, but last year proved the wealthy enclave isn’t distant enough to escape a similar tale of two markets — and the same names in brokerage that dominate the five boroughs.
Deals were aplenty at the start of 2022, on the heels of the pandemic-era boom. Buyers flocked to the East End in the spring, before activity ground to a near halt, plagued by scarce listings and economic uncertainty.
“Historically, economic cycles don’t necessarily impact the Hamptons as much as other places because it’s such a desirable geography for people,” said Nanette Hansen, brokerage manager of Sotheby’s International’s East Hampton operations.
But interest rates, compounded with the possibility of a recession and declining consumer confidence, meant “you had a lot of people sitting on their hands and not doing too much,” Hansen said.
The market dipped, but in the area that provides a respite for New York’s moneyed elite, the floor is only so low: Brokerages still managed to rake in billions of dollars selling opulent vacation and co-primary homes.
Big brokerage fish take the local pond
Big-name firms dominated The Real Deal’s ranking of Hamptons firms. The analysis includes both buy- and sell-side transactions between April 20, 2022, and April 20, 2023, from One Key, East End LI and Out East and verified by the brokerages.
The top 15 brokerages by sales volume combined for $10.6 billion from April 2022 to April 2023, and the top five brokerages each topped $1 billion.
Douglas Elliman snagged the top spot with $2 billion across 771 deals. The brokerage, led in the Hamptons by Todd Bourgard, was followed by Corcoran, with nearly $1.8 billion across 562 deals, and Compass, with nearly $1.6 billion across 472 deals.
The strongest hindrance to deal volume is a lack of inventory, according to Bourgard.
“We have people that have been looking for their $3 million, $5 million and $10 million homes, and we’re having a difficult time having those homes come on the market,” Bourgard said. “[But] once they do, if they’re priced properly, they’re gone immediately.”
Though the major players dominated the high end of the ranking, boutique brokerages in the Hamptons made their mark on the top 12. Bespoke, a luxury firm founded in 2014 by brothers Cody and Zachary Vichinsky, ranked sixth with $879 million in sales across 53 deals. But it wasn’t the top independent firm — that honor went to Saunders & Associates, with $1.4 billion in sales for fourth overall.
Corcoran CEO Pam Liebman said boutiques may have held their own against the behemoths because they’re willing to work for less.
“It doesn’t necessarily benefit the seller in the long run,” she said. “You never know if you left money on the table by not getting the full exposure [of marketing by a larger firm.]”
Bespoke, which focuses its work on homes priced at $10 million or more, had an average sale price of nearly $16.6 million, the highest in the region.
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Shifting sands
Amid the top-dollar deals, there was trouble for Bespoke. Former broker Jarret Willis claimed in a lawsuit this year that the brokerage failed to pay him at least $545,000 in commission from three properties sold in 2022 on the East End.
The suit follows allegations from Willis and a former Bespoke Florida executive of racist and discriminatory behavior, which the brokerage has denied.
Bespoke wasn’t the only firm hit with legal action on the East End last year: A lawsuit by a client surfaced in April 2022 accusing top Brown Harris Stevens agent Chris Burnside of having sex with his associate Aubri Peele in a client’s Southampton home in May 2021.
CEO Bess Freedman said in an internal email the firm would investigate, but it’s unclear if any punishment was levied against Peele or Burnside, who was named BHS’ top Hamptons broker and third overall in its annual awards.
BHS, with executive managing directors of the Hamptons Robert Nelson and Philip O’Connell at the helm, finished in seventh place with nearly $785 million in sales across 215 deals.
While sales activity slowed down overall, agents and executives pointed to the wide variety in the market.
“It’s tough to paint with a broad brush,” said Hedgerow Exclusive Properties co-founder Preston Kaye. “The lanes in Amagansett are going to differ from the estate section in Southampton.”
Compass’ Joe Fuer said demand for homes west of Shinnecock Canal is comparatively strong, as is demand for homes under $3 million, which make up the vast majority of sales in the Hamptons.
Activity has lifted this summer, according to Vichinsky, and the market could pick up in the second half of the year in the direction of 2019, but short of the peak pandemic years.
“I think you’re going to see some deals,” said Vichinsky. “I think you’re going to see some big deals.”