We all know the East End market is Covid-crazy; to try to make some sense of it all, we chatted with Adam Miller, the esteemed Bridgehampton real estate attorney.
Let’s start macro-ish and work our way down to the micro stuff. Give our audience a sense of what you see happening in the East End market. Are we truly in a sellers’ market? Are we seeing big increases in prices? Is your business busier than it’s been? Are you contending with increased sales volume and premiums on the selling prices, and market value in general? Let us know about anything you think might help illuminate the dynamics of the current market.
With all the uncertainty in the world, our real estate market saw a tremendously bullish summer. The pace was something we have never experienced before. It was absolutely a sellers’ market—it seems that a second home became a necessity for those who can afford such a luxury. This was true throughout all sectors of the market. We did a large number of significant transactions on both the sell and buy sides.
Are you seeing anything remarkable or unusual? For example, an increased number of bidding wars, more now than during normal times? More deals falling apart because sellers are getting higher offers after they’ve already accepted an offer? New types of contingencies in contracts? Have rentals figured into sales at all more than is usual? Are sellers or buyers demanding faster closings?
Yes, we are seeing many unique things that require the entire office to maneuver swiftly to secure deals for our clients. There must be fast and effective communication from memo of sale to contract signing and then a coordination of a quick closing. Because real estate affects so much of peoples’ lives, and because the Hamptons has qualities that appeal to people’s lifestyles and give them space and access to nature, the market was like we have never seen it.
What kind of stress has this put on the service providers in the market? Are the title search folks, surveyors, environmental companies, home inspectors able to respond and show-up on time, or are you finding delays, which then delay the closings? How are the banks doing with closing on-time? Any frustrations you want to tell us about? How are the towns doing issuing building permits and C of Os? Any news there?
This summer put a tremendous strain on all real estate professionals and others who serve the market. I would say we all had very little summer, but it’s hard to complain when you are busy. We are all well aware of the amount of pain being felt by many in so many other industries. Being effective in this market requires great relationships. We pride ourselves on the strength of our local relationships. That’s a linchpin of our practice.
Are you finding more cash deals now versus pre-Covid days? If so, why?
Yes. People don’t have the benefit of time; so where there might have been contingencies in the past, the market hasn’t allow for that benefit this year.
What are buyers telling you about returning to the city? Are they truly migrating out here full time, giving up their city residences and sending their kids to school out here? I’ve heard about the insanely long waiting lists for private schools. Are you also hearing this from your clients?
A large number of people have told me they will either be staying for the foreseeable future or maybe permanently. Many of these people had not spent such significant time out east. We all know why happens when they do—they fall in love with all that’s here.
Are the towns taking any steps to control the improvements to property or any measures in general to heighten conservation with so many people coming out here?
The towns have always been protective of our environment. They continue to do a great job in keeping up with demand. Much of the local land is protected forever.
The market is incredibly active. There’s a rush, in some cases almost a desperation, to buy. Can you offer any insight as to some of the pitfalls when buying in such a hyped market?
Getting important information from the municipalities has been challenging due to Covid and their limited staff and opening. However, this is where key relationships are critical. We’ve been able to press for information that our clients needed in order to make the best decisions.
Let us end with some lawyerly advice. What would one helpful piece of advice be for buyers? And one piece for sellers? How can they win in this market?
For buyers I would say make sure to choose counsel wisely. Buyers cannot sacrifice important information despite the frenetic nature of the market.
For sellers, I would say if they have specific important terms: they should stick to their guns and not get caught in agreeing to anything they will regret.
