The tri-state rental market’s endless summer
Exorbitant prices, booked rentals and busy agents show a tri-state market that never cooled down is getting even hotter
You could call it a different kind of March Madness.
Just three months into the year, Colette Harron, a William Pitt Sotheby’s International Realty agent in Connecticut, has already rented all but one property for the summer.
Summer will be “completely packed and booked, I’m sure,” Harron said.
The tri-state market has been hot ever since last summer. And this summer, the primary question on agents’ mind is whether they will have enough supply to meet the demand.
Bookings in the Hamptons between January and March — typically considered the off-season months — increased 10 percent year-over-year to 3,473 from 3,162, according to online booking data from VRBO and Airbnb shared with The Real Deal. Booking value surged to $10.1 million from $7.9 million, an increase of 28 percent.
For the tri-state area, it’s truly been the year of the endless summer — and the market will surely heat up going into warmer months.
For Hamptons-focused rental business StayMarquis, booking activity is up 250 percent year-over-year.
“It could be an indication that people are just looking to secure their properties earlier in the season this year because they know that inventory is really low,” said Bryan Fedner, co-founder of StayMarquis.
That may be a lesson learned from the year before.
When the pandemic hit, New York City residents escaped to the tri-state area, looking for larger homes with amenities such as pools, home offices and, if possible, the beach.
“Everyone ran away in fear and desperation mode because we were all caught in a new situation of life,” Cristina Matos, a Hamptons broker with Brown Harris Stevens. “This year that climate condition does not exist, [but] it’s still a priority to get settled and have summer plans.”
Matos said she completed 14 leases in the first two months of 2021.
Supply is even tighter now because many who own homes in prime areas would rather stay in them than rent them out. And with would-be renters increasingly willing to pay exorbitant rates, some owners are demanding steep prices to seal a deal.
Between May and July of last year, the average rate in the Hamptons was $967 a night. That’s already increased 6.6 percent to $1,031 per night for the same period in 2021.
“These owners are taking advantage of this current market because people are paying inflated rates for these properties, just to be out there,” Fedner said.
Though some renters are just looking for a summer getaway, the pandemic has turned others into buyers looking to get a taste of an area before making a purchase.
“People like to test the waters to buy,” Ellen Stern, a Julia B. Fee Sotheby’s International Realty broker based in Rye, New York. “You just have more buyers than you’ve ever had, so you have a larger installed base of renters.”
The pandemic panic is beginning to ease with the vaccine rollout, and New York City is coming back to life. Indoor dining capacity has been upped to 35 percent and movie theaters have gotten the green light to reopen. Still, agents don’t see the tri-state market cooling down anytime soon.
“Even in a normal life, most of the New Yorkers want to be [in the Hamptons] in the summer,” Matos said. “It gives you the sense that you are on vacation. … The city can never do that.”
Stern adds that she’s seen many Hamptons renters turn to the suburbs to become buyers.
“It’s a triangle to me,” Stern said. “Hamptons, suburbia and the city.”