“The Holy Grail”: Why Hamptonites pay such a premium for waterfront homes
Be it oceanfront, bayfront or pond-front, even a mere view of water seems to drive up property values
From the canal to the ocean, from the bay to the pond, Hamptonites really love water.
“Oceanfront, bayfront, pond-front and even water-view properties continue to be the holy grail of Hamptons offerings for East End buyers,” said Corcoran Group’s Gary DePersia.
This desire remains true despite the inherent difficulties associated with building or owning properties near the water, which include but are not limited to the whims of the Federal Emergency Management Agency’s flood zone maps, wastewater management approvals, clearing standards and setback requirements.
“It’s simple,” DePersia continued. “Waterfront, in all categories, is the most finite commodity that we have in the Hamptons.”
The Hamptons proper — the land east of the Shinnecock Canal — is the first and only part of Long Island with mainland oceanfront real estate. Moreover, throughout the Hamptons (with the exception of Montauk), it is impossible to see the ocean from downtown.
There are varying levels of value when it comes to waterfront. Even among the lucky few with oceanfront property, there’s better and best. The most coveted are properties that have not only a private ocean beach that belongs to the homeowner but also a dock on the bay for his or her boat.
This is a phenomenon encountered on Meadow Lane in Southampton, where properties large enough to be both ocean- and bayfront are rarely for sale. One such property, 700 Meadow Lane, is currently available for an eye-popping $175 million; another, 1050 Meadow Lane, sold in January 2020 for $41 million.
At some oceanfront properties, the owner does not possess the beach or the dunes in front of the house. In East Hampton, 57 Further Lane sold for $57 million late last year; six acres of land came with the property, but the Nature Conservancy actually owns the dunes in front of the house. In contrast, the oceanfront 15 West Dune Lane in East Hampton sits on 2.45 acres, but the dunes are considered part of the property. It sold for $61 million in October 2020.
Surprisingly, some oceanfront properties don’t have much of a view. Can a person see incoming waves from the house? That’s worth more than a view of the calmer waters offshore.
The fight over Truck Beach has been raging in Amagansett and Napeague since 2009. Homeowners claim to own the ocean beach in front of their houses, up to the high-water line, while the Town of East Hampton, the Town Trustees and other residents contend that the beach is public, and people can drive on it. If the homeowners prevail in court, they can expect their property values to increase by millions of dollars.
The next premium waterfront is pond-front. Sagg and Georgica ponds are ideal, and the closer to the ocean the better. In Bridgehampton, 236 Quimby Lane — on Sagg Pond and with an ocean view — sold for $26 million two years ago, despite the fact that it was an old house in desperate need of renovation. Farther up the road and away from the water, 25 Quimby Lane — albeit a smaller house occupying about half as many acres — sold for just $7.1 million the same year.
Properties with deeded ocean access always command a premium over those without. Two properties for sale in Bridgehampton illustrate this point: Both are on about an acre and located one house away from the ocean. The dated home with deeded oceanfront access is asking $17 million. The one without — a modern new build with every bell and whistle — is seeking $17 million. Take your pick.
In Montauk, recent sales indicate that properties are worth at least $750,000 more if they’re located in Hither Hills, site of the Montauk Beach Property Owners Association, which includes the right to park at private ocean beaches. A four-bedroom occupying 0.17 acres at 93 Duryea Avenue in Culloden sold for $750,000 in January. But in Hither Hills, 133 Grant Drive — another four bedroom, on 0.16 acres — sold for $1.45 million in March.
Next in the hierarchy is ocean-view land, more at a premium west of Montauk for reasons stated above. But even here, there are levels. Is the view more of an “ocean glimpse” or an epic panoramic view, in which great sights can be taken in from all around the house? Being able to smell and hear the ocean also commands a premium of its own. 73 Mako Lane in Amagansett sits two houses away from the water, from which the ocean can be viewed and heard. It’s asking $2.6 million on 0.28 of an acre. A mere three-minute walk up the street, at 33 Mako Lane, a house similar size house and plot is asking $1.7 million.
Bayfront is a favorite of Hamptons homeowners because a dock is usually permitted. In Water Mill, a property of 2.3 acres with a fine house and a dock on Mecox Bay is asking $29.5 million. Just a few miles away, a similar size house and land without waterfront and a dock is available at 164 Trelawney Road for $12.5 million. In fact, the $29.5 million property is the cheapest available on Mecox Bay; prices easily rise into the $40 million range. Clearly, a convenient place to store one’s boat is prized.
Lakefront — leaving aside Lake Agawam and Georgica and Sagg ponds — is especially prized in Montauk. The two magic words are “riparian rights,” which means the lucky owner can dig his or her own clams from the yard. They can, also swim, kayak, paddleboard and go boating. Last year, a 1950s house with three bedrooms and 0.71 of an acre on East Lake Drive sold for $2.95 million. A similar place, not on the water, is currently for sale for $2 million.
“For many buyers, the dream of owning on the beach, the bay or a large pond with accompanying views and access continues to be the most elusive dream of all given the higher prices and lower inventory,” said DePersia. “One wants what they can’t easily have — and nowhere more so than the Hamptons.”