The plethora of New York-based wealthy fashion designers that own trophy houses in the Hamptons including Calvin Klein, Donna Karan and Tamara Mellon hopefully don’t want to part ways with their mansions anytime soon.
That’s because, if they do, they’ll likely have to take a hit on what they think their mansions are worth as an uncertain political and economic backdrop mean that the swanky summer hot spot’s luxury housing market isn’t as hot as it used to be.
Indeed, in the latest sign of how sellers are having to be more realistic on what their homes are worth, a new report by appraisal firm Miller Samuel on behalf of Douglas Elliman Real Estate found that the listing discount — the change from the final asking price to what the buyer actually ended up paying — has almost doubled from 8.5 percent a year ago to 16.2 percent in the first three months of this year.
At the same time, the average number of days a high-end Hamptons property spent on the market, meanwhile, jumped 80 percent from 109 to 197 as buyers refused to budge until prices came down, while the average final sales price in the luxury market was $6.69 million, down by almost a quarter compared with a year earlier.
Though best known for VIP residents such as Klein and Martha Stewart, the Hamptons has long been a favorite of Wall Street types, meaning that the health of its housing market is largely linked to the performance of the financial markets.
While sales bounced back between 2013 and 2015 as potential buyers regained confidence after the global financial crisis, jitters started to set in again due to the U.K.’s unexpected decision to leave the European Union, a slowing economy in China and the U.S. election.
And while the lower end of the market is going from strength to strength, the luxury market — defined as the top 10 percent of sales — is certainly becoming a buyers’ market, with sellers having to travel the distance to meet buyers’ expectations, according to Jonathan Miller, the chief executive officer of Miller Samuel and author of the report.
“Buyers are holding out and sellers are having to come to meet them,” he told WWD.