The view from Sagg Main Street in Sagaponack, N.Y., captures the Hamptons generally: new houses going up, often in place of old ones. One veteran builder estimates that “90 percent of buyers prefer new.” Adam Macchia for The New York Times
In the Hamptons, where million-dollar vacation homes are snapped up like flea-market finds and $10 million spec homes are in such high demand that their developers could moonlight as fortunetellers were they not so busy building more, buying new has become not only the fashion but the first choice. Buying vintage tends to spawn repair and renovation headaches; choosing turnkey promises convenience and five-star amenities.
To find appropriate settings for new construction, tearing down an old house, far from being vilified, is standard operating procedure as land grows ever scarcer and more expensive.
From Westhampton to Montauk, buyers (and renters, too, especially those willing to write a six-figure check for a summer spot) are on the same attitudinal and aspirational wavelength: new is better, more sustainable, and infinitely richer in amenities than old.
“The demand is absolutely there,” said Enzo Morabito, a broker at Douglas Elliman Real Estate, “and builders are hitting buyers’ sweet spots at a variety of price points in a variety of locations. This is like Disneyland: people don’t come out here to make their lives more complicated. They come out to relax, and buying turnkey is part of that. Some even buy the house already furnished. People want the whole package.”
Occasionally, picky buyers commission a custom-built retreat on the site of a teardown. “You’re seeing teardowns, not necessarily of the golden oldies, but of the ranches from the ‘60s and ‘70s on half-acre or acre lots now worth far more than the homes that sit on them,” said Anthony DeVivio, a managing director of Halstead Property. “And what’s being built in their place is making the landscape more interesting.”
If trees and vegetation succumb in the knockdown process, no worries: that’s for the landscapers to remedy.
“Teardowns are being snatched up by developers with a build-and-beautify mind-set,” said Aspasia G. Comnas, an executive managing director of Brown Harris Stevens. “In the second-home market, most buyers are not interested in doing any work; they just want to bring their toothbrush and move in. The opportunity to buy something brand-new has caused a shift in the low-to-middle range where people are valuing structure over location.”
The look of the homes is evolving as well: modern is making a comeback, but modern in the guise of barnlike. “The modern barn is the Hamptons equivalent of the TriBeCa loft,” Ms. Comnas said.
Traditionally, the most desirable territory was south of Montauk Highway, where the ocean is. But the line of demarcation has blurred, and properties north of the highway have become desirable because buyers a bigger bang for their big bucks.
“Buyers spending $4 million to $6 million, and sometimes even less,” said Zachary Vichinsky of the Corcoran Group, “are demanding the same amenities you get in a $20 million house.”
The nexus of the Hamptons McMansion production line, the Farrell Building Company, currently has 30 spec homes in various stages of construction, mostly in the $3 million to $10 million range, and mostly in Amagansett and Bridgehampton. Mr. Farrell said he scaled down the grandeur of his spec properties “after the meltdown in 2009, when everything in the Hamptons came to a standstill.”
“I’d say 90 percent of buyers prefer new,” added Mr. Farrell, whose footprint includes Farrell Court in Water Mill, “and right now we’re selling three new houses a month. When the finance guys on Wall Street get the feeling that interest rates are going to go up, they swarm in and buy. There is an unbelievable appetite for homes in this price range. It’s like the difference between a $150,000 Bentley and the $350,000 Bentley: both are great, but 15 times as many people are able to buy the cheaper car.”
According to the latest Elliman market report for the fourth quarter of 2013, the average Hamptons sales price was $1.57 million, the average price of luxury properties $7.1 million. At the upper end of that spectrum, buyers seem willing to spend freely for land, new construction and the removal of past-their-shelf-date houses.
“The 2014 Hamptons market appears to be shaping up to see continued stability in prices, more new development, but not quite enough additional inventory to satisfy demand,” said Jonathan J. Miller, the president of the real estate appraisal firm Miller Samuel, who prepared the report. “Wall Street had a little better year compensation-wise, and that figures to play into keeping demand steady.”
This old-looking new East Hampton house that Michele and Thomas Bass rented for two years while house-hunting turned out to be The One. Adam Macchia for The New York Times
The political provocateur Bill O’Reilly of Fox News encountered no raised eyebrows when he recently paid $7.65 million for a musty Montauk bungalow on a prime 1.5 acre oceanfront bluff only to immediately tear it down (the house, not the bluff); Mr. Farrell was retained to fashion a pristine replacement.
Seven to eight million dollars per acre is the going price for oceanfront property in hipster-and-surfer-approved Montauk, formerly the funky final frontier of the Hamptons. The sales volume there rose 60 percent last year, according to a report by Judi Desiderio, the chief executive of Town & Country Real Estate, the brokerage that had the listing Mr. O’Reilly bought.
“There’s nowhere left to go, we’re the end of the island, and we’re in with the in-crowd,” said Nancy Keeshan of John Keeshan Real Estate, one of Montauk’s oldest firms. “It’s like their grandparents bought in Southampton, their parents in East Hampton, and now the 30-something generation with the means to buy in the Hamptons is coming out to Montauk and giving it a face-lift.”
According to Ms. Keeshan, fixer-uppers can still be had for $550,000 and up; houses within walking distance of a beach are $1 million to $2 million; and places on the waterfront with 21st-century amenities start at $3 million, $9 million on the ocean.
Irene O’Gara is building her “dream house” just across the street from the ocean in Montauk’s Hither Hills enclave. After Ms. Keeshan showed her every available option under $1 million, the final property, a 0.68-acre lot with two decrepit cottages and an ocean view, won her over. “It was magic,” said Ms. O’Gara, who did not let the $2.5 million asking price dissuade her. She paid around $2.1 million for the lot, had the cottages knocked down after ruling out renovation, and hopes to have the shingle-style compound that will be her primary residence — a four-bedroom main house “with hurricane-impact Marvin windows,” a pool house with spa, and a garage — completed by this summer.
“Clearly the beauty of building new is that it gives one the opportunity to create everything state-of-the-art, keeping energy and environmental concerns front and center,” she said. “I want it to look like it’s always been a part of the Montauk landscape.”
In Southampton Village, another hot spot where new construction can cause a buyer stampede even before the house is finished or listed, the volume of sales increased by 62 percent over 2012, Ms. Desiderio’s report noted, and the total amassed through sales last year was just over $507 million, with the fourth quarter accounting for $167 million. Many houses were new, with seductive extras like theaters, spas, playrooms, outdoor kitchens, elevators and wine cellars, in addition to the usual pool and tennis court.
“The only thing better than the smell of a new car is the smell of a new house,” Ms. Desiderio said. “Just the 1 percent of buyers seems to want old and antique.”
Whitney Casey and her husband, Nav Sooch, who have a home in Austin, Tex., and a 170-year-old SoHo loft as their pied-à-terre, were certain they wanted an authentic Victorian in Southampton village as their summer home. But they changed their minds after doing extensive shopping with Harald Grant of Sotheby’s International Realty. Ceiling height and lack of bathrooms were a concern.
“The Victorians looked quaint from the outside,” Ms. Casey said, “but you’d go inside and find out that not only was there no master bath, but some barely had bathrooms at all. And at six feet tall, I felt like Alice in Wonderland, like I was way too big for the house.”
She was riding her bike on a village lane when she noticed an unfinished gambrel-style farmhouse on a construction site (its incongruous predecessor on the prime 0.4-acre lot was a tiny vinyl-sided cottage). After being taken on an impromptu tour of the seven-bedroom seven-and-a-half-bath house by its builder, Louis Follo, she revised her priorities. The Lutron automated home-technology control system, the pool house, the four fireplaces and the 5,672 square feet of space — gosh, here was a house, priced at $5.7 million, where you could “plug in and play,” as she put it, and not fret about necessary upgrades.
“We’d had all these conditions, like the house couldn’t be big, it had to be old and quaint; basically it couldn’t be everything our house ended up being,” Ms. Casey said. “I was a little worried about telling my husband it had an elevator, but I think what sold him on it was the quality of the construction. And that it made me happy.”
The elevator, which doubles as a dumbwaiter, makes Cowboy, their four-pound Yorkie, happy, too.
Even in Sag Harbor, a former whaling village where owning a house with a quaint facade is for all intents and purposes a mandatory zoning stipulation, buyers want their charm wrapped in a ribbon of redone, according to Terry Cohen of Saunders & Associates.
”I’ve seen the pendulum swing progressively toward new,” she said, ”especially with land prices doubling in some areas. And in an up market, it pays to buy new: Not just the Wall Street types are realizing that this is a good place to park your money. When you see an inland spec house sell for $21 million,” she said, alluding to 79 Parsonage Lane in Sagaponack, built last year by the high-end developer Michael Davis, “it’s a sign that people are willing to go north of the highway if it means finding a super-great house with all the amenities on their playlist.”
Sure, many of these new houses have classic cedar shingles on the outside, but inside they are chic tabernacles of all that is design-forward, indulgent and technologically precocious. The middlebrow bungalows, Capes and ranches of yesteryear are disappearing, victims of the wrecking ball, fast becoming the most popular tool in the builders’ kit. ”Unless a house has really good bones or is grandfathered closer to the ocean than you’re allowed to build today,” Mr. Davis said, “there’s often very little reason to renovate.”
“Teardowns are becoming more common because people want new if they can get it,” said Dottie Herman, the chief executive of Douglas Elliman.
John Gicking, the brokerage manager at the East Hampton outpost of Sotheby’s, put it this way: “New, new, new is overtaking location, location, location. Builders buy a series of contiguous lots and create a neighborhood from scratch using what they know about buyers’ punch-lists — dramatic entries, ground-floor masters, media rooms, fully finished basements — to bring a brand-new product to market at a lower price point, say $2 to $4 million, than the typical estate-like custom home.”
Michele and Thomas Bass spent almost seven years searching for a vacation home in the Hamptons before realizing that the new custom-built five-bedroom house on the fringe of East Hampton village that they had rented through Martha Gundersen of Brown Harris Stevens in 2012 and 2013 was the house for them. “When we made the original decision to buy, we were looking in Amagansett,” Ms. Bass said, “but I couldn’t find anything that was right. We wanted moderate size, and something not so old that we’d have to gut and redo it. But the new construction we saw in the lanes, I felt was inflated or cookie-cutter or both.”
The rental, described in its listing as “The Modern Manor House,” was for sale, list price $4.2 million. Set on a landscaped 0.93-acre lot on a cul-de-sac, it had distinctive features like a grand 19th-century wooden front door, reclaimed beams in the den, reclaimed oak as the base of the 10-foot-long granite kitchen island, a lower-level media room, travertine patios, a heated pool and state-of-the art technology.
“As soon as I walked in, I loved it,” she said. “The windows are super-big, the woodwork is beautiful, and it looks like no other house I’ve seen. It’s off the beaten path, but just 10 minutes from Amagansett and Sag Harbor. And it’s spotless, even the utility room.”
Only when smitten by waterfront properties do buyers tend to rein in their appetite for new construction. “Really, there is nothing truly brand-new on the ocean that I know of,” said Tim Davis, a veteran broker with the Corcoran Group, “with the exception of one listing in Sagaponack. Probably the only scenario where location dictates over the trend of buyers wanting new would be waterfront: Even at the most expensive level, when it comes to buying real estate you always have to make some sort of compromise. Really, home technology is changing so drastically that you can have a home that’s four or five years old and already needs changes to the infrastructure to bring it up to speed.”
“I’m seeing that people prefer new because they want to be the first to use everything in a home,” he continued. “New means instant gratification.”
Not every buyer chooses immaculate new construction. The recent sale for $75 million of the 84-year-old Wooldon Manor in coveted Southampton Village set a Hamptons record as the highest for a stand-alone home on a single lot.
The five-acre oceanfront Tudor-style estate is the site of the former Woolworth mansion and was owned most recently by the shoe magnate Vince Camuto. It has eight accompanying acres of pristine property, nine bedrooms, 12 and a half baths, and innumerable bells and whistles, thanks to constant renovations. The initial asking price of $48 million was bumped up to $75 million after the adjoining acreage was added, and the property promptly sold.
Yet like so many recently purchased Hamptons homes, it sits on the site of a teardown: the 50-room Woolworth mansion, circa 1900, razed in 1941 after being deemed too unwieldy and outdated to merit restoration.
The current Wooldon, still impressive at 12,000 square feet, was originally the pool house. It will be a survivor rather than a wrecking-ball victim, said Tim Davis of the Corcoran Group — a listing broker, who also represented the buyers — because the new owners will be stewards of its antiquity, like Mr. Camuto. ROBIN FINN
Copyright © 2014 The New York Times Company. Reprinted with Permission. Adam Macchia/The New York Times.