Real Estate

A house just rented in the Hamptons for $2 million for the summer

A beachfront residence is seen in East Hampton, New York.
Jeffrey Basinger | Reuters

A home in the Hamptons rented for $2 million for the summer, as demand far outstrips a record low supply of homes for sale and for rent, according to brokers.

The number of homes listed for sale in the Hamptons plunged 41% in the first quarter, marking the fastest decline on record, according to a report from Douglas Elliman and Miller Samuel. The median sales price, which jumped 31% to $1.3 million, is now 20% higher than the median sales price in Manhattan.

“I’ve never seen the Hamptons market like this — ever,” said Gary DePersia, a top broker in the Hamptons for over 25 years. “As soon as a property comes up for rent or sale, it’s snatched up right away.”

While markets across the country are seeing a shortage of homes for sale, supply is especially tight in these exclusive New York beach communities. Families that fled to the Hamptons during the early days of the Covid pandemic are staying on, preferring to commute to New York only as needed. The stock market boom and surge in asset prices has led to a wealth explosion that even Hamptons brokers say is unprecedented. And the lack of building supplies and land have prevented builders from keeping up with demand.

A 42-acre estate in Southampton just went into contract for more than $100 million, brokers said, marking the most expensive deal in years for the Hamptons. In East Hampton, there have been four recent deals for over $50 million, DePersia said.

First-quarter sales in the Hamptons were the strongest in six years, according to Douglas Elliman and Miller Samuel, suggesting the market shows little signs of cooling.

On the rental side, brokers said the shortage of homes for sale has also led to a shortage of rentals. Homeowners who typically rented their homes out for the summer are now selling — or deciding not to rent at all since travel to Europe and other high-end destinations is still limited by Covid.

The rental shortage has led to soaring prices, with little room for negotiation, brokers said.

DePersia said a house in Sagaponack that rented for $90,000 last July, rented for $225,000 this July. On the “lower” end, houses that used to rent for $35,000 are now going for $60,000.

He said he has a long list of clients looking to rent high-end homes for between $400,000 and $600,000 for the season, but there simply aren’t any available.

“I wish I had 10 of them,” he said. “I could rent them all.”

Rentals are taken almost as soon as a listing is posted. Broker Rima Mardoyan said some wealthy clients are flying in by helicopter or jet to see a property on the same day it’s listed — only to find it rented by the time they arrive.

“I tell people, you can’t wait to decide. You have to take it right away,” she said.

Mardoyan and other brokers said at least one home in the Hamptons rented for $2 million for the summer, though the deal was done discreetly without an official listing.

“This is a whole new level of wealth we’re seeing now, even for the Hamptons,” she said.

Harald Grant, a longtime Hamptons broker, said he recently made an offer on behalf of a client to rent an oceanfront home for the summer for $2 million. He was rejected.

“I offered him $2 million and the owner said no,” Grant said. “Can you imagine? It’s a different world now.”

Some homeowners have started over-reaching with prices, brokers said, asking $500,000 for a middling home far from the water or with old interiors. Yet Mardoyan said she wouldn’t be surprised if the bidding wars now common for sales in the Hamptons start to spread to rentals, with renters competing to offer more than the asking price.

“It hasn’t happened yet,” she said. “But I think that’s the next phase. People want to be here and they have the money.”