In speaking with nine real estate experts, they can all agree: Sag Harbor property is hot, and it is not cooling down anytime soon.
The Sag Harbor Express invited a slate of local professionals to discuss current industry issues and trends. Included in this feature are: Judi Desiderio, chief executive officer of Town and Country Real Estate; Scott Strough, an associate broker with Compass in Sag Harbor; Simon Harrison, principal broker for Simon Harrison Real Estate Brokers; Gioia DiPaolo, a licensed associate broker with Sotheby’s International Realty in Sag Harbor; Julie Masson, a licensed associate real estate salesperson with Saunders & Associates in Bridgehampton; Enzo Morabito, a licensed associate real estate broker with Douglas Elliman Real Estate in Bridgehampton; Robert Canberg, a licensed real estate salesperson with Nest Seekers; Jane Holden, a licensed associate broker with Brown Harris Stevens of the Hamptons in Sag Harbor; and Chris Tice, senior managing director of The Corcoran Group in Sag Harbor and Montauk.
Here is what they had to say.
Express: What is your general feeling about real estate in and around Sag Harbor?
Judi Desiderio: Sag Harbor real estate is white hot! It is the single most vibrant village with the most eateries per linear foot and, simply put, it’s fun.
Scott Strough: Real estate investments throughout Sag Harbor Village and the surrounding communities of North Haven and Noyac have performed really well year over year. It’s an easy equation of quality of life — plus beautiful, natural resources equal a strong real estate market.
Simon Harrison: Demand is strong for a variety of reasons.
Gioia DiPaolo: The market in and around Sag Harbor seems strong. The first quarter will tell a big story. We’re seeing a lot of activity from buyers who want to buy now through spring and be in by summer. There is some good inventory; interest rates are still low.
Julie Masson: The early year-end numbers are out and, based upon the data, so far it looks like there was a really major increase over 2016. The true numbers won’t be available for another couple of weeks, but the early signs are good.
Enzo Morabito: The reason we’re in Sag Harbor is because the marketplace is really, really diverse. It favors us. We’re not snobs, we’re not poor, we’re not rich, whatever it is. We love the marketplace, and it’s a very, very vibrant marketplace. You have families, you have new people coming in, and then you have the real, real luxury. It’s just a very diverse market.
Jane Holden: There are a high number of properties on the market at this time — many of them overpriced.
Robert Canberg: Even with the recent market adjustment that was felt throughout the Hamptons this past year, Sag Harbor continues to hold its own. The last three years we have seen the median sales price increase both in and out of the village. Even without ocean beaches, it continues to draw people of all ages, from its trendy restaurants to its artsy feel, all the way down to the historic components that make up this one-of-a-kind Hamptons destination. In 2018, I expect it will only get better and continue to show signs of growth.
Chris Tice: Sag Harbor has evolved into a year-round destination and real estate remains in high demand for primary and second homeowners. In the fourth quarter of 2017, we saw a healthy uptick in the number of sales in Sag Harbor, versus a year ago. When houses are staged and priced properly, they sell.
Express: What trends do you see emerging in the Hamptons overall?
Judi Desiderio: One request we are hearing over and over from our buyers is their desire to be close to the hamlet of their choice — “walk to the village.”
Scott Strough: There appears to be an architectural trend that has become quite popular in a modernist perspective. Flat roofs and lots of glass panels, along with clean modern lines throughout the interior, are most favored.
Simon Harrison: Buying perfectly good houses for the land value alone.
Gioia DiPaolo: The return of the working kitchen. Buyers don’t seem to be as keen on open living/dining/kitchen space unless the design allows for the ability to close off the kitchen when necessary. Modern homes with lots of glass continue to trend.
Julie Masson: There’s a lot of wealth floating around out there, and I have noticed that people that have previously contacted me for rentals are looking to buy for the first time. I have been especially busy with the under-$2 million buyer, especially under a million, and there seems to be less of that inventory available, especially something turnkey. I also have a handful of buyers looking for the waterfront trifecta: a great house on the water with pool and deepwater dock. They exist, but aren’t easy to find, and are extremely pricey. Overall, I’ve been working with mostly second-home buyers and investors lately. I’m hoping that I’m able to work with more local families in the next year. I find getting a year-round family into a property especially rewarding.
Enzo Morabito: Normally what happens is, the marketplace gravitates to different places. Two years ago, it was Montauk, and then that wanes. At the end of the day, Sag Harbor feels like downtown New York, so you can go out there and every place else is the same every year. Has the marketplace changed? No. It’s just where the focus is at this particular point. Sag Harbor, Westhampton Beach and Hampton Bays — oh my God, Hampton Bays — are where the market is right now.
Jane Holden: Buyers seem to be slower about making the commitment to sign a contract.
Robert Canberg: The new modern-style architecture continues to impress, some even showing a little more farmhouse-style in combination with that modern style. But I believe the trend is that less is actually more. Buyers are okay with a smaller, more effective, more maintenance-free lifestyle. They can get away with 4,500 square feet with four to five beds, a pool and a wide-open living concept.
Chris Tice: Properties under $1 million continue to be in high demand throughout the Hamptons, and inventory is tight at this price point. Additionally, buyers recognize value, and when a property is value priced, regardless at what price point, there is often a bidding war. We’re also seeing that most buyers are staying away from a house that is a “project,” unless they see a significant upside on their investment.
Express: Is real estate in Sag Harbor aligned with those trends?
Judi Desiderio: Sag Harbor set the bar!
Scott Strough: Fortunately we have a national registry of the Sag Harbor Historic District, which allows for the village to retain and preserve its architectural vintage. The members of the architectural review board have a very important job to perform as they attempt to balance preservation with modern construction.
Simon Harrison: Yes. Vacant land gets bought and built until there are just “hills and holes,” then scrapper houses.
Gioia DiPaolo: There are several magnificent modern homes at the high end on the market in North Haven. North Haven is aligned with the modern trend, as there are a lot of waterfront sites that lend themselves to modern, glass residences and there are many 2-plus-acre lots in North Haven also lending themselves to this type of structure.
Julie Masson: I think so. It’s really tough to find anything affordably priced in Sag Harbor right now; $600,000 used to buy you something pretty decent, now it’s a small cottage in need of a full renovation, or property on a main road also in need of renovation. The waterfront market is still tight. Sag Harbor is one of the premiere places on the East End that has the properties that appeal to boaters — room for a deepwater dock, decent-sized house and often a pool, as well.
Jane Holden: Yes. Buyers seem to feel there is always something better out there. Owners need to realize their homes may not be worth what internet companies state they are.
Robert Canberg: Absolutely! We are seeing more and more modern styles come to life, especially on the water outside the village in North Haven, for example. However, the charm of this whaling village with all its incredible history and architecture is still alive and well. The difference now is these village renovations and/or facelifts come with some newer, more modern amenities.
Chris Tice: Yes, we’re seeing this happen in Sag Harbor. We’re also seeing that buyers interested in historical houses in the village are still looking for upgraded, more contemporary amenities.
Express: What are prospective buyers looking for right now? What are they shying away from?
Judi Desiderio: The only thing that smells better than a new car is a new home. Buyers love new — if not new, then immaculate. It is challenging to sell a home that is tired and needs work or updating. Experienced brokers and stagers can help sellers best prepare their homes for launch. Maybe it is new furniture, maybe paint job, landscape clean up. Every site is different, but the work in means money out.
Scott Strough: Prospective buyers are constantly searching for answers to their specific needs, whether it’s a place to live, an investment property, or even a renovation project. Real estate is a hard asset that you can live in, tinker with and always create memories in.
Simon Harrison: Under a million is hard to meet demand, new construction at $2 million and under is hard, at $3 million it starts.
Gioia DiPaolo: Our buyers are looking for new construction/move-in condition. The village buyer wants a home with a historic feel, architecturally, but it must have all the modern conveniences and an open feeling. Buyers are shying away from homes requiring too much work, unless pricing is very compelling.
Julie Masson: Mostly under a million with good upside potential and waterfront with pool and deepwater dock. Many want to feel they are making a sound investment and that they can increase the value of the property, so they can trade up in three to five years. I have also noticed buyers looking for something that has a uniqueness about it, whether it’s the house itself, the setting, the gardens. These have all impacted the ultimate decision to buy a certain property over another in the last five or six transactions of which I was a part.
Enzo Morabito: Most of the prospective buyers are coming from metropolitan areas, and they pretty much have an apartment or bought an apartment recently, so they’re way ahead of us regarding the design that they want. Some people think the Hamptons dictates what happens in New York. No way, no how. What happens in New York comes to us in six months to two years. That’s where it starts. If you really want to understand the market in the Hamptons, look at what they’re looking at and transporting here — and give them light. Light is very, very important.
Jane Holden: One thing that will never change is a buyer wants a good deal, or at least what they feel is a good deal. Buyers will no longer overpay.
Robert Canberg: They are looking for open floor plans with high ceilings, finished lower levels with 9- to 10-foot ceiling heights, multiple entertaining spaces and chefs-style kitchens with plenty of room to entertain. Light and bright is key, with spaces that open easily to the yard and pool area. What’s not as popular? Homes without pools, and lower levels with limited height, finished or not, and no formal dining.
Chris Tice: Prospective buyers are more sophisticated than ever, and at every price point they are looking for value in their investment. Houses that provide unique opportunities, such as waterfront or in the village, are always in high demand. Additionally, most buyers are looking for less formal spaces to match their Hamptons lifestyle, and are increasingly interested in upgraded outdoor living spaces and amenities, such as outdoor kitchens, fire pits/fireplaces, and lounge areas.
Express: What are you seeing in terms of the commercial real estate market? How is it performing in Sag Harbor?
Judi Desiderio: Commercial is a separate market altogether — completely unlike residential — and should be handled only by a local commercial expert. Sag Harbor, while the core business district is small, there’s more wet use than most per square inch.
Scott Strough: Commercial real estate has always surprised me throughout Sag Harbor, as it is a high-demand market with many buyers available to pounce on available properties. Bragging rights and the attraction of trophy properties seem to govern the deals being made, and economics often take a back seat. Main Street rents are very high, which may not be a good thing, as small mom-and-pop businesses cannot sustain the monthly rents. Remember that those small businesses are the backbone to Main Street and our community.
Simon Harrison: Not a lot of movement, largely because commercial is long-term, land-bank preservation of capital — or cap rate based — and the numbers here are tight.
Julie Masson: I don’t really do much in commercial, but have noticed some really unique listings have come onto the market in Sag Harbor particularly over the past year.
Enzo Morabito: I think commercial real estate in Sag Harbor is a long-term IRA. You can’t go wrong. For what people want to sell it for, you buy it. It’s through the roof, long term — 10, 15 years.
Jane Holden: There are very little commercial listings available in Sag Harbor, so the value remains strong.
Robert Canberg: Rentals are always in demand here, and once a “For Rent” sign hits the window on Main Street, it’s usually rented very quickly.
Chris Tice: As with all real estate, the commercial real estate market is about location, location, location. Since Sag Harbor Village is such a vibrant, year-round community, commercial real estate tends to be in high-demand, and usually not on the market for long.
Express: What advice do you have for sellers looking to put their houses on the market right now?
Judi Desiderio: Call in the right professional to guide you through preparing your home to present the best possible launch and create a marketing plan, which needs to be nimble. Our forms of marketing are changing rapidly. At T&C, we use social media, web portals and digital marketing, as well as traditional print and tried and true tools.
Scott Strough: Sellers have not had a better moment in time than now to list their properties for sale. There will be a significant amount of cash buyers coming out of the equity markets to buy real estate in the Hamptons. Sag Harbor has become the crown jewel of the Hamptons. If you are looking to sell, it’s your turn at the plate.
Simon Harrison: Paint it any color you want as long as it’s white, and call me.
Gioia DiPaolo: Timing is great to list right now, to take advantage of the buyer who wants to buy now to be in by summer.
Julie Masson: Listen to your listing agent! Pricing is so important and if you list at the correct market price, you will significantly reduce the number of days the house will be on the market — therefore, fewer showings, fewer disruptions to the seller’s life. Also, staging and curb appeal are still key. I have had people not get out of the car to see a house because of the ugly front door or sloppy landscaping. Inside, the house should show with a neutral, modern palette, yet warm and inviting. You want the buyer to envision themselves living in the home, not looking through your personal photos, noticing the pet stains on the rug, or funky odors.
Enzo Morabito: We’re putting on a lot of houses right now. We’re emphasizing lowering the price to market value. If you’re a seller, you have to be a real seller and you want to be right where the market is. If you price it right, there are buyers galore.
Jane Holden: Declutter. If possible, have a fresh paint job done. If you are listing in the fall, have your pool, sprinkler and air conditioning contractors give you letters stating the condition of equipment at the time of system shutoff.
Robert Canberg: Buyers today have a good amount of inventory, so know your true motivation on selling and price accordingly.
Chris Tice: Buyers have a lot of inventory to choose from, so it’s important to prepare and stage a house. This includes four things: fixing any noticeable defects, like chipped paint or cracked tiles; decluttering, which will help make the house appear larger and in better shape; making the décor as neutral as possible, so buyers can walk in and picture themselves living there; and pricing your house to attract the most interest, which usually generates the best sales price. Of course, choosing the right real estate firm and agent to list your house with is another important step.
Express: What advice would you give to buyers?
Judi Desiderio: The right professional saves you time, effort and money in the long run. Most of all, they streamline a fairly intricate process for you.
Scott Strough: Get in the game. Study the market and put in the time to absorb the information that is readily available. Everything from high-resolution photography, drone photography, virtual tours, floor plans, comparable sales information are a few of the tools buyers should work with throughout the buying process.
Simon Harrison: Act fast, but with professional guidance.
Gioia DiPaolo: Do your homework. Check out the neighborhoods. Study the transfers, work with a good agent who will give you an overview of both closed transactions and current inventory. Work with a buyer’s agent. If you know what you want and have a knowledgeable agent working with you, chances are you’ll be enjoying summer in the Hamptons.
Julie Masson: Look beyond the décor! Too many sellers don’t take staging advice and buyers can become really distracted by dated furniture or an unkempt landscape. The bones of the house and lot are the most important, and are often fully transformed by a simple coat of paint, the removal of the seller’s belongings, and better interior or landscape design.
Enzo Morabito: Give them the money — if they’re priced right.
Jane Holden: If you will be obtaining a mortgage, speak to your banker or mortgage broker so that you know what you can afford. Be realistic about what your money will buy.
Robert Canberg: Be ready for competition. Well-priced homes are not going to be around long. Do not think you have all the time in the world to make a move.
Chris Tice: Many times we’ve seen buyers think they want one type of house, or a certain neighborhood, only to fall in love with and buy something very different. So I suggest to buyers to be open to looking at a variety of options. Of course, it’s also important to work with an agent who is knowledgeable about the market, and delivers exceptional customer service.