They’re going rental!
From the East End to the West Coast, one-percenters are scrambling to secure summer rentals amidst an unprecedented surge in property prices for the nation’s wealthiest ZIP codes.
“All the good stuff is rented,” says Compass broker Philip Scheinfeld, who is sheltering in Amagansett. “And the rentals that are on the market are raising their prices because they think there is pent-up demand, and that people who would go to St. Tropez and Ibiza will want to stay in the Hamptons and not travel outside the US.”
Just look to Sandcastle, one of the Hamptons’ buzziest properties, known for hosting vacationing celebs like Jay-Z and Beyoncé. In 2019, the 31,000-square-foot mansion was asking $1 million for the season. This year, thanks to the coronavirus, it rented overnight for $2 million — making it the most expensive East End rental ever.
“Brokers are doubling prices,” says Betsy Cox of Blackbook Concierge, who has been rushing to lock down hideaways for her well-heeled clients. Cox recently looked at homes in the Hamptons, Palm Beach and Malibu for various families.
“Everyone was price-gouging or they were looking for summer prices now,” she says. “Middle-class rich people are getting bid out.”
In one case, she reached out regarding a 9,100-square-foot, seven-bedroom rental at 3180 Washington Road in West Palm Beach. Her client was prepared to pay the $75,000-a-month ask even though the house was “across the bridge,” i.e., west of the Intracoastal and not on Palm Beach island itself. The broker came back saying that the owners now wanted $100,000 a month.
“It was worse in Malibu,” adds Cox. “Brokers were doing seven leases a day. I would say, ‘I want that house,’ and they would say, ‘Nope, someone just signed a lease,’ or ‘Nope, someone just bought it.’ It was crazy.”
According to the real estate listing service Out East, the median price for a Hamptons rental in March was $30,000, growing to upwards of $150,000 for a Memorial Day to Labor Day rental. But brokers say that many owners are asking for those peak summertime prices right now.
“For the most part, this is a secondary or tertiary or 25th home for folks,” says Cody Vichinsky, an owner of Bespoke Real Estate. “But this pandemic for New Yorkers has merged necessity and desire. Now it’s important to have another place to go. We haven’t seen that type of thinking since 9/11.”