Dan's Papers - September 5, 2008

With Labor Day behind us, the 2008 Hamptons rental season has come to a close. With cars and SUVs loaded up like Jed Clampett's Beverly Hillbillies truck, the renters were moving west on Route 27, with bikes, surf boards, kayaks and canoes in tow. The evacuation of the summer renters is all but complete.

Even with gas prices at all time highs, and the real estate sales market crippled by the recent events both in the sub prime market for mortgages and confidence in the economy, the rental market was relatively constant if not strong. Real estate agents, whose commissions on rentals is miniscule compared to home sales, were none the less busy booking homes for weeks, months and days. My unofficial survey saw hot early activity back in February, with a 10% increase over last year. Then as the economy waxed gloomy, rentals slowed down until Memorial Day, when they picked up and the market was in chaos.

With people looking for steal deals and some renters desperate or impatient, rentals were either 20% lower or the same as the previous year (which was a longer season by one week). However, as June became July, then August, rentals became strong as availability verses need became an issue. Once again homes with pools were at a premium, as was location. A lot of the choice homes had their usual renters from previous years or first timers. The trend seems to be, however, that not many renters spent weekdays in the homes until late August.

A semi-retired friend of mine had to spot-rent her home to make up for higher expenses and lower dividends from Wall Street. This woman who had never rented her home in the summer, did so this year every other week for a few days in the hot market. She was amazed at the thousands of dollars she took in. Another friend of mine had the opposite effect - failing to find a renter for the entire summer due to late construction work. She found herself renting weekly, and re-cleaning the house every Sunday. (By the end of the summer she had a crew in place.) Next year she vows to have the home ready by February for the whole season.

A former musician friend actually rented his house off Stony Hill Road for $65,000 up from the $52,000 he pulled in last year via Craig's List. But, as he said, he went through hundreds of bogus offers. The super rentals were consistent, for those who have regular renters, however it was slow for those who didn't. A realtor explained if someone is used to the house and used to the price it's an easy deal. To tell someone new to the market it's $100,000- $200,000 for the summer it's a tougher sell.

At Prudential Douglas Elliman, Regional Manager Paul Brennan said that for Prudential, rentals were "extraordinary - the best in five years for the company, up 25 percent from last year. In fact, we had one agent who had over 70 rentals. That's amazing."

The same seemed to be true at Town & Country. Partner Janet Hummel said, "It was our best rental season. Our Bridgehampton and East Hampton offices did over 200 rentals. It was a total success."

Joe Kazickas of Rosehip Partners, a new real estate company Kazickas formed after leaving Brown, Harris, Stevens, said, "It was a good rental season with more foreign activity than ever before."

So as the home owners reclaim their homes for what many consider the best season of the Hamptons, meaning September and October, it's a whole new ballgame. With the restaurants manageable for reservations, the weather still warm and the over zealous crowds just plain absent, home owners now get to enjoy their summer homes themselves.