Dan's Papers - January 16, 2009

The placid snows falling gently into the ocean as the waves crash to the shore will soon give way to the hustle and bustle of crowds of surfers, swimmers and bathers on the beach. Between now and then is the activity leading up to a new Hamptons rental market - an opening move in the gambit that becomes "the season" that is so important to the economy out here on the east end of Long Island.

The billion dollar question is: Will rentals be strong, the same or weak compared to last year? In 2008, rentals had a robust start with what Town and Country real estate agent Linda Batiancela called the "serious people," who know what they wanted and paid early to get it. But when Wall Street stumbled so did the rentals. But oddly, last August seemed to mirror the price of gas: as gas went up so did the demand for rentals in the Hamptons, with many firms such as Corcoran, Brown Harris Stephens, Prudential Douglas Elliman, as well as Town and Country setting records for rental activity.

Fast forward to 2009. What do the experts see? Batiancela, Town and Country's leading rental agent for the last two years, was asked for her prediction. Reluctantly, she reasoned, based on her experience, that around 50% of the rentals will be priced around 10% less than last year, with 40% of rentals staying the same (due to demand), and the last 10% will actually increase due to the addition of pools or other property improvements. "The renters are usually very savvy and they know the market," she said.

All renters are invited to investigate the 2009 Town and Country e-Renters Guide, which is available online at www.1townandcountry.com. This tool is must for both those offering homes to be rented and those looking to rent.

New to the rental season of 2009 is www.hamptonsrentals.com, an interactive website that, at the moment, has over 400 rentals listed on it, from Westhampton Beach to Montauk. This will be the first active season for the website, the brainchild of James Young and Joe Kazickas of Rosehip Partners, one of two new real estate firms created in the last year in East Hampton.

The main question is, with European currencies down around 20% from where they were last year and the economic trouble now global, how will this effect rentals? Last year Europeans played a huge role in the up scale rental arena.

Another issue, raised by Batiancela, is that there will be more piecemeal rentals instead of entire season deals. "People are in the habit of coming out here," she said, but with so many cognizant of their spending, "they will spend less time out here, not taking a whole summer." In fact, in the spirit of the New York City illegal subleasing, another real estate agent said, "a problem now is the renter renting out holiday weekends without the owner's knowing, which is in violation of the contract. With things the way they are some owners turn a blind eye, which is dangerous."

Other problems according to a new agent of a local firm are caused by the "vulture" - the uncouth, crude speculator who will go around and visit every rental property and make "insulting offers." This year, there seems to be an increase of this breed, which hopes to prey upon others' misfortunes. Many believe the activity of Craigslist.org has introduced the bottom feeders to the East End real estate market. Many Craigslist renters know underhanded tricks - like suing the home owners months later in smalls claims courts in towns up island, where judges may have some bias, thinking that all Hampton homeowners are rolling in the dough, and that the rental prices paid were unjustified. In these cases, the judges may rule in the favor of renters who sue, because, say the pool wasn't truly heated as the contract said. A word to the wise renter is: Beware of your contracts and whom you rent to. One unnamed agent said, "Beware of renting to lawyers!"

If you're a homeowner renting for the first time, Batiancela offered tips to make your home show well and bring in top dollar. "First of all, when showing the house, have it accessible -meaning it can be shown often and easily. When it's being shown depersonalize your house, then keep it neat and very free of clutter," she said. "Lastly, if you don't have the yard done weekly, have a professional come in and clean it up."

A perennial owner who has been caught up in the piecemeal rental reality of these times spoke of the preparations it takes to re-rent your house. It has to be pristine each time, any damages from the previous renters must be repaired before the new crew comes in. Ending one rental and starting another on the same day can be problematic. If, for example, you've been told the pool pump isn't working, the air conditioner's down, the clothes dryer broke or that there are many burnt-out light bulbs, this can cause major problems.

Of course, with low expectations due to so much gloom and doom, there is a chance that 2009 could be the best summer ever. Perhaps, as the world around seems to be in chaos, everyone will be grateful for the simple things a day at the beach can present. Visitors to the East End could take the time to enjoy their well earned down time even more this year, to offset the miseries from the workaday world. The beautiful sunsets, powerful sunrises, and glorious days will soon be at hand. No economic indicator can ever take them away.