As workers return to offices and New York City “reopens” again, New Yorkers are eyeing second-homes closer to the city. Other buyers are seeking weekend retreats and “partnering to purchase” in the Hudson Valley and The Hamptons. What’s in store for these markets, already booming as people sought havens during the pandemic? Leading industry experts honed in on the hottest locales and how best to manage regional transactions at a virtual panel on March 24 hosted by the Hudson Gateway Association of REALTORS®, Inc. (HGAR) and OneKey MLS.
“Getting the Deal Done: Seeking Second Homes in New York” featured Katherine Jennings, branch manager, Millbrook office, Houlihan Lawrence; Randy Florke, founder and president, The Rural Connection, Hudson Valley/Catskills; Jason Karadus, owner and principal broker, Corcoran Country Living, Hudson Valley/Catskills; and Robert Nelson, executive managing director, Brown Harris Stevens for The Hamptons.
Richard Haggerty, CEO of HGAR and president and chief strategic growth officer of OneKey MLS, the regional multiple listing service for New York, opened with an overview of the regional housing market. Citing OneKey MLS data to compare sales trends of single-family houses from 2019 to 2021, Haggerty pointed to significant increases in both the number of transactions and median prices in several counties.
“2020 and 2021 have been banner years for the entire market, but the second-home market has especially benefited from that two-year period,” said Haggerty. “Sullivan County just knocked it out of the park, with a 35.6% increase in the number of transactions and a 71.5% increase in the median sale price.”
Dutchess County saw a 29.3% increase in the number of transactions and a 27.5% increase in the median sale price, while Putnam County had a 31% increase in transactions and 23% increase in median sale price. Haggerty noted a 13.5% increase in the number of transactions in Suffolk County, and a 27% increase in the median sale price.
The event was moderated by Brian D. Tormey, NTP, president of TitleVest, a NYC-based provider of title insurance and related real estate services. The hour-long discussion included rental trends, regulatory reactions and pushbacks on Airbnb; non-New Yorkers buying vacation homes; the uniqueness of small towns and partnering with local experts; transaction patterns and whether supply will catch up with demand.
The panel was asked if technology-enabled methods of vacation homeownership, such as Pacaso, are affecting the secondary market and whether buyers are trying to leverage Airbnb, Vacation Rentals by Owner or VRBO, and new forms of ownership like a split share to buy vacation homes.
“The Hamptons has always been a place where people come for the summer and in the 1960s, ‘70s and ‘80s, it was known for a lot of group shares,” said Nelson. “That didn’t go over too well with many, so they enacted laws. Also, prices of summer rentals went so high, young people, even if they were getting a share, just couldn’t afford it.”
As Airbnb took off, Nelson said, short-term rentals picked up even though it can be illegal in some jurisdictions in The Hamptons to rent short term less than two weeks. The pandemic changed that dynamic, Nelson said: “Now, since Covid, it’s reversed. Everyone’s back to rent for the season, the summer, six months, a year.”
Jennings talked about the types of homes and properties buyers are seeking in the Hudson Valley and how distance from New York City became less of a factor during the pandemic.
“The psychology of the second-home buyer has changed,” Jennings said. “They have a vision of what they want—they’re not really buying the ‘bricks and mortar’ as much as they are buying the ‘idea’ of a place of tranquility, a retreat. That vision is very different for everybody. It’s one reason buyer’s agents are so important in the Hudson Valley—to understand the various markets—because all of our hamlets and towns each have their own little fingerprint.”
The panel weighed in on how the “work from home” trend continues to impact the second-home market and how that could change as more workers return to the workplace.
“The pandemic truncated what was already happening in the market,” said Florke. “Some people were beginning to work from home, one day a week. Covid validated that. It’s not necessary to be in the office five days a week. And the pandemic gave many people the excuse to do what they wanted to do…to move from the city upstate. Now, as the pandemic is receding, people don’t want to take their kids out of schools in Rhinebeck or Cold Spring to go back to the city. Many have reoriented their lifestyle and I think most are sticking to it.”
Another trend the panel noted is non-New Yorkers seeking second homes in the Hudson Valley.
“We have seen an uptick in interest and inquiries from West Coast-based buyers in the higher end of the market, particularly properties in the $3 million to $5 million range and up. We listed Sylvan Rock, the first single-family residence designed by Aston Martin for $8.25 million. The majority of inquiries, offers and ultimately the buyer was from California.”
Karadus added that part of the appeal was the “modern architecture, which is more available on the West Coast but rare in the Hudson Valley—but quickly growing in popularity.”
To view the full webinar, click here.