“I thought we’d have a great rental boom right now,” sighs Diane Saatchi, a Hamptons broker at Dayton-Halstead. “I figured, people won’t want to fly, they’ll want to be close to the city. And with everyone so concerned about the economy, they won’t be buying. Well, I was wrong.”
Maybe she’d been reading the paper. On January 25, the Wall Street Journal warned dawdlers that SUMMER RENTALS ARE GOING FAST DUE TO CONTINUING TRAVEL FEARS, citing the Hamptons as an example. Last week, the Post declared HAMPTONS HIDEAWAYS HEATING UP.
Homeowners took notice. “I know some people who rented out their place for $50,000 every summer,” says one broker, “but as soon as that Journal article came out, they raised the price to $125,000.” (There have been no takers.) “We’ve been hearing from a lot of our customers: How come nobody’s showing our house?” says Saatchi. “They want to know what they’re doing wrong.” Beba Shamash, who’s rented out her home for six summers, confides, “Last year was pretty dismal. I hope it’s heating up, but I’m definitely not getting more calls.”
Nor are most of her neighbors. “There certainly hasn’t been a swarm of people,” says Devlin McNiff’s Stuart Epstein. Barbara Blumberg, of Allan M. Schneider Associates, agrees: “I’d say the ratio of sale inquiries to rental inquiries so far is about six-to-one. I don’t know who wrote that Wall Street Journal article, but it wasn’t about us.” Prudential’s Paul Brennan agrees: “Sales have been strong, but rentals are suspect – some looking, but not many cigars.”
A few brokers say everything’s fine. “The high-end market is active in both sales and rentals,” says Dunemere’s Andrea Ackerman. Tina Fredericks, owner of Tina S. Fredericks Realty, maintains, “My feeling is that things are lively for February.” But many of the Wall Streeters who make up the Hamptons-share crowd don’t seem so lively. “There’s less disposable income to throw away on a rental,” says Sotheby’s John Golden. Another broker adds that “bonuses were low or nonexistent, and they play a big role in those decisions.” One former renter explains, “I can’t count on a raise, and I’m saving all my extra cash. When and if I do feel like parting with my money, I’ll do something more culturally fulfilling.”
Many of those with cash are choosing to buy instead of rent. “A house is a good place to park your money, especially with interest rates so low,” says Brennan. “It’s what I’d do. Actually, it’s what I have done – I just bought.”
And few in the business seem genuinely scared. “No one’s that unhappy about the rentals,” says Epstein. “Sales are more lucrative anyway.”
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