By Claudia Aoraha, Senior Reporter For Dailymail.Com
04:00 03 Nov 2023, updated 04:02 03 Nov 2023
- In some cases, owners have cut their asking prices by hundreds of thousands of dollars in Sag Harbor and Amagansett
- The sudden bounce is believed to be linked to the highs seen during the pandemic, when buyers were paying double, have now settled
The Hamptons ‘middle class,’ comprised of New Yorkers with somewhat modest million-dollar second homes out East, have been dropping their asking prices by nearly 30 percent in a bid to sell their homes.
Because of growing interest rates and the post-pandemic need to be in the city more often, many middling Hamptons staycationers, who own properties up to $5million, are attempting to sell their homes at reduced prices.
In some cases, owners have cut their asking prices by hundreds of thousands of dollars in Sag Harbor and Amagansett.
One agent told the NYPost that prices for homes on the lower end of the spectrum are dropping. They said: ‘We’re not talking about the ultra-wealthy here – these people are subject to economic norms.
‘When it comes to having a vacation home, it’s just not as easy to justify the cost.’
The sudden bounce is believed to be linked to the highs seen during the pandemic, when buyers were paying double for homes out East, have now settled.
Without widespread work from home rules, and people forced back into the office in the city, many with their second homes are struggling to justify keeping them.
The source said: ‘I know a lot of people turning their remote offices in the Hamptons back into bedrooms and putting them on the market.’
One property in Sag Harbor, which is currently on the market for $2,395,000, has had its price knocked by a total of 28 percent since March 2023, according to Zillow.
Before then, the six-bed, six-bath Hamptons home with its own private pool was listed for $2,750,000.
The home, located in picturesque Sag Harbor, is described as ‘a unique investment opportunity’ for a buyer who wants to give it ‘some tender loving care.’
There is a spacious 3,285 square foot main house with five bedrooms and three and a half baths, as well as a private-entranced one-bedroom, one-bath apartment suite for visiting guests.
The listing on Zillow states: ‘On warm summer days, take a dip in the inviting gunite pool, shoot some hoops, or go enjoy the deeded beach with mooring rights that is the gateway to Long Beach and its breathtaking sunsets on Peconic Bay.
‘This is a golden opportunity. With a proven track record of generating income from both long and short-term rentals, this compound presents incredible potential.’
Still despite the sizeable cut, the home is still sitting on the market.
Similarly, in luxurious Amagansett, NY, a three-bed home’s asking price was cut by 23 percent in the last month alone.
On October 1, the stunning property was listed at $1,795,000 – but this was cut to $1,395,000 by October 24.
The beach cottage boasts water views of Napeague Bay in Amagansett’s hidden gem, Lazy Point.
Buyers can enjoy ‘majestic sunsets and spectacular sunrises with views stretching to the Connecticut shores from this charming home that exudes peace and tranquility from a bygone era.’
The listing adds: ‘The home is equipped with three bedrooms, a full house generator, and central air conditioning and is set upon a picturesque double lot size of .38 acres.’
Another home in Amagansett has dropped its asking price significantly in recent months in a bid to get off the market.
On August 18, it was listed for $5,700,000, but that was dropped to $4,995,000 a month later in September – making it a 12.4 percent decrease.
The five-bed, seven-bath property, which is on a private quiet cul-de-sac, is just ‘moments away’ from ocean beaches.
There are 18 foot cathedral ceiling in the living room and a double-side gas fireplace shared with the dining room – set on private, lush grounds with a 20 x 40′ gunite pool.
On September 7, another quintessential Sag Harbor home was listed for $3,200,000 – but within six weeks the asking price dropped by 12.5 percent to $2,800,000.
Zillow described it as having ‘classic charm and modern convenience,’ including an open floor plan, top-of-the-line appliances and four bedrooms.
Outside, it has a ‘beautifully landscaped backyard with a spacious patio deck overlooking the heated pool.’
This emerging trend comes after a former Oppenheimer analyst who was dubbed the ‘Oracle of Wall Street’ predicted that house prices are set to plummet for the first time in a decade.
Meredith Whitney is famed for sending an accurate research report sounding the alarm overs risks incurred by Citigroup before the financial crisis.
But as warning bells emerge again over the health of the US economy, Whitney told Insider she did not fear another recession thanks to robust consumer spending which has been bolstered by low unemployment rates.
Instead, her focus is on American house prices which she expects to decline for the first time in over a decade. It marks a stark reversal of a pandemic-inspired trend which has seen home values shoot up by 42 percent since March 2020, according to CoreLogic.
However, Texas could fare much better – after experiencing a huge influx of California residents who migrated there in search of cheaper living costs.
She said: ‘This is state-specific. And so I expected this to happen. With 10-years-plus — 12 years — of data, now I can look at it and know that, in fact, it did happen and it is happening.’
But trends in the current climate have shown otherwise.
US home prices rose for the seventh consecutive month in August – hitting a record high – according to new data.
Prices increased 0.9 percent in August from the month prior, according to the S&P CoreLogic Case-Shiller US National Home Price Index – the leading measure of US house prices.
It means year-on-year properties have gone up by 2.6 percent, the Case-Shiller data showed.
Mortgage rates are at a multi-decade high – with the average 30-year fixed-rate deal hovering around 7.79 percent, according to Government-backed lender Freddie Mac.
Soaring mortgage rates, and historically low inventory, have continued to push up home prices in the majority of the country’s 20 biggest cities.
According to the Case-Shiller 20-city composite, 12 cities saw average home prices increase in the year ending August 2023 versus the year ending July 2023, while seven saw prices decline, and one was unchanged.
Westpac says inflation is likely to remain above the Reserve Bank’s 1 to 3 per cent target range for all of 2024, with the potential for another increase in the official cash rate (OCR) in the first half of next year.
“While we are seeing lower imported goods and food inflation, domestic price pressures are still running red-hot,” the bank’s chief economist Kelly Eckhold said. “We continue to forecast a protracted period of sub-trend economic growth.”
Eckhold said household budgets would continue to be squeezed as rising interest rates increasingly bite.
“A significant portion of past interest rate increases are still to pass through to borrowers.”
Eckhold said the new Government was likely to tighten the fiscal purse strings to try to bring the Budget back to balance, which would help reduce inflation pressures.
“Nonetheless, Budget deficits will likely persist in coming years and the Government will have to make some tough choices, given that population growth will increase demand for core public services and infrastructure.”
Eckhold said strong migration would support economic growth.
“Population growth is running at multi-decade highs and is adding to demand as well as the productive capacity of the economy,” he said, adding the growth would affect the housing market.
“Higher long-term interest rates will restrain future house prices to some extent, but the impact of the surge in population will be significant. On balance, we expect house prices will rise by 8 percent over 2024.”
Eckhold said China was expected to continue to be a challenge for exporters, along with weak commodity prices.
“As a result, Westpac has revised down the speed at which commodity prices will rebound in coming years.”
He said the bank expected a further increase in the Reserve Bank’s OCR in the first half of next year, and only gradual rate reductions from early 2025.
“Our sense is that further monetary policy action will still be required to ensure that inflation will fall in a timely manner.”
However, Eckhold said there were considerable risks in the market, which created some uncertainty.
“There are a number of pressures in both directions, which might mean that either interest rates have to go up even a bit further than we currently forecast or indeed, that they could even come down maybe a little bit earlier than we’re forecasting.
“So we think it’s going to be quite important for ourselves and the Reserve Bank to be watching the data pretty carefully to see how things pan out.”
From left: Shane and Anna Brealey of NZ Living, Simplicity CEO Sam Stubbs and COO Andrew Lance. Photo / Supplied
KiwiSaver provider and investment fund manager Simplicity is today launching a new fund to build and finance a targeted 25,000 new homes nationally worth $12 billion in the next 10 to 15 years.
- The median sale price for single-family homes in Palm Beach hit $14 million in September 2023 – a 117 percent year-on-year increase
- Palm Beach sits just north of Miami, where prices have risen by 7.7 percent over the past year to reach a median sale price of $599,000 for a family home
- Rocketing prices are being driven by a movement of millionaires and billionaires flocking from high-tax states such as New York, New Jersey and California
A growing number of billionaires flocking to Florida‘s richest neighborhoods are driving house prices on the East Coast to record levels.
The median sale price for single-family homes in Palm Beach hit $14 million in September 2023 – a 117 percent year-on-year increase, according to national real estate brokerage Redfin.
Palm Beach sits just north of Miami, where prices have risen by 7.7 percent over the past year to reach a median sale price of $599,000 for a family home.
This is markedly more than other more northerly Florida hotspots like Orlando, where the median price is $425,000 – a more modest increase of 1.9 percent over the past year, which is less than the 3.7 percent inflation rate in the 12 months to September.
Millionaires and billionaires are flocking to the Florida coast to escape high-tax and Democrat-run states of California and New York.
Eye-watering prices shelled out by ocean-side homeowners in Palm Beach even dwarf the cost of living in other well-known celebrity magnets, such as San Francisco where the median price of a family home is $1.6 million.
In Manhattan, the median price sits at $1 million, $345,000 in Houston, $238,500 in Indianapolis, Indiana and $80,000 in Detroit.
Chris Leavitt, a top Palm Beach broker with Douglas Elliman, described the prices in the elite East Coast city as ‘mind-blowing’.
‘There is a very limited supply, especially at the ultra-high-net-worth end, where the clientele is all clambering for that amazing lake front or oceanfront property,’ he told NBC.
The meteoric rise in prices could be partly down to thousands of rich homeowners moving from Manhattan to Miami.
Redfin calculated a 5,776 net outflow of Manhattan residents leaving for the Magic City over three months alone from July to September 2023.
‘You can still find a nice house here for under $10 million,’ Leavitt said. ‘I know that sounds like an alternative universe. Because yes, this is an alternative universe.’
The record for the most expensive home sold in Palm Beach was set in April, when luxury car dealer Michael Cantanucci paid $170 million for a 1.6-acre oceanfront mansion.
Tech billionaire Eric Schmidt, who is among the 100 richest people in the world, is the latest to acquire collections of properties in Miami.
Along with his wife Wendy, the former Google CEO has bought up more than six homes on the Sunset Islands, spending more than $140 million.
Meanwhile, hedge fund billionaire Ken Griffin has recently revealed plans to create the world’s most expensive home on Palm Beach.
His $1 billion mega-estate over 20 acres on the resort lies just a quarter mile from Donald Trump’s Mar-a-Lago and Billionaire’s Row.
Among the rich and famous neighbors nearby are Jeff Bezos, who spent $150 million on two adjoining properties in Indian Creek Village, and National Football League legend Tom Brady.
National Party leader Christopher Luxon speaks at Shed 10 on election night. Photo / Dean Purcell
Originally published by Democracy Project
Who will the new National Government listen to when it decides how to govern? An early indication may be seen in who Prime Minister-elect Christopher Luxon has brought in to train his new MPs and ministers.
It was reported on Monday by Newstalk ZB that because Luxon acknowledges his team’s lack of governing experience, the party has brought in some senior figures from the past. Luxon told Mike Hosking that Steven Joyce, Sir Bill English and Wayne Eagleson have been coaching his caucus on how to be MPs and ministers, and how to lead the public service.
Of course, it’s not unusual for new governments to bring in party veterans to help guide the new administration and teach them some tricks. For example, when Dame Jacinda Ardern was setting up the last government, she called on Heather Simpson, who had been Helen Clark’s chief of staff, to help train the new MPs and ministers.
Joyce, English and Eagleson are not only some of the most senior figures from Sir John Key’s former administration, they are also now involved in corporate lobbying and other private sector pursuits.
Wayne Eagleson: Beehive chief turned lobbyist
Wayne Eagleson was one of the last National Government’s most powerful players, yet he was almost unknown to the public. As chief of staff he ran the Beehive on behalf of National prime ministers Key and English, from 2008 to 2017. When Key was Prime Minister, he described Eagleson as New Zealand’s “most influential unelected official”.
Eagleson was part of the core negotiating team, alongside English and Steven Joyce, who tried to persuade Winston Peters to go into coalition government with National in 2017. They failed, and in fact, Peters went on to take legal action against the three of them, blaming them for being involved in the leaking of his personal superannuation information in the lead-up to the 2017 election.
On leaving the Beehive, Eagleson established Wayne Eagleson Consulting Limited, and then joined lobbying firm Thompson Lewis. That firm was led by G.J. Thompson, who stepped down as a lobbyist for five months to be chief of staff for the new Ardern Labour-led Government.
When Eagleson shifted almost straight from the Beehive to being a lobbyist, he explained he was “looking forward to using the experience I have gained in the Beehive and prior to that as a senior corporate affairs manager”. Thompson said the deal with Eagleson to bring him on board was done “over a couple of beers”, with Thompson explaining that it was beneficial to have someone from National to balance the lobbying firm’s links to Labour: “In New Zealand, you can’t afford to be too partisan.”
Steven Joyce: Minister of Everything, and now Adviser on Everything?
Joyce has been a major figure in National for the last two decades. He led the restructuring of the party in the Don Brash years, and then ran National’s election campaigns from 2005 to 2017. Coming into Parliament in 2008, he was immediately appointed as a Cabinet minister, and eventually became Minister of Finance (as well as becoming known as the so-called “Minister of Everything” and “Mr Fixit”).
Joyce was a businessman before entering politics, and returned to this in 2018, setting up Joyce Advisory, a company specialising in business strategy, consultancy, brand management and reputation. In addition, Joyce has been appointed to and employed by an array of businesses, from property development to engineering. Some of these clients have developed close relationships with the National Party under leader Christopher Luxon.
The most politically controversial business Joyce has joined is the major property developer Winton, a company that has been locked in a legal battle with the Labour Government. In Opposition, National was supportive of Winton, with Housing Spokesman Chris Bishop even putting out a press release backing them.
Winton is also seen as a prime beneficiary of National’s new policy of partially abolishing the ban on house sales to foreign buyers. If implemented, all properties over $2 million could be sold to wealthy foreigners, increasing the market and demand for the houses being sold by property developers like Winton. For this reason, political commentator Matthew Hooton suggested in the Herald that, “incredibly”, the policy had been created “with the help of lobbyists” for “the property-development industries”.
Joyce has also been connected with other National Party policies. RNZ’s Guyon Espiner uncovered how closely the University of Waikato worked with the National Party on its promise to create a new $300m medical school in Hamilton. Joyce’s consultancy company Joyce Advisory was paid nearly $1m for helping with “lobbying advice” on such issues. Waikato University even helped pay for National’s announcement, and vice-chancellor Neil Quigley emailed Health Spokesman Shane Reti to say the policy could be “a present” to a future National government.
As well as giving “lobbying advice” to Waikato University, Joyce is now on the University’s Management School Business Advisory Board. He’s also a company director for a number of businesses – Icehouse Ventures (a venture capital fund manager), Hammerforce (a technology and IP company), and RCP (a property and construction project management consultancy).
Sir Bill English: A post-political career in business
Former Prime Minister English is incredibly well-connected in Wellington politics-business circles. Since leaving Parliament in 2018 after 28 years as one of New Zealand’s most influential politicians, he’s taken on a number of big roles in business.
The most interesting has been as the founder and chair of ImpactLab, which English describes as specialising in “using data to support better decision making by measuring social impact”. Essentially the company works with the private and community sector in work related to big data and social investment modelling. Their website states: “We’re on a mission to connect decision-makers with information they can act on to grow their impact.” The say their clients are “charitable services, primary health entities and social enterprises” and that the business aims to “partner with philanthropic foundations and trusts, private donors, and government agencies”.
New National MP Emma Chatterton has also joined the National caucus from ImpactLab, after working there for the last four years.
This week English warned the incoming Government that he thought that the existing public service wasn’t going to be able to deliver all the reforms and programmes that National wanted. He was reported as saying there was an answer to the shortfall outside of the state: “On the plus side, Covid funding, in particular, had helped strengthen a wide range of community, iwi and non-governmental organisations’ ability to deliver social services at the grassroots level far more effectively than central government agencies.”
English is also the director or chair of a number of other companies: Todd Corporation, Wesfarmers Ltd, Manawanui, and Mt Cook Alpine Salmon.
The need to keep scrutinising National’s advisers
Luxon’s pending National-led Government is fortunate to have the help of Eagleson, Joyce and English – they will be extremely useful in training and advising National’s new MPs and Ministers. But the fact that all three are now deeply involved in the business sector, and to some degree will be helping their business interests lobby government and navigate the political landscape, raises questions about potential conflicts of interest.
And what of other lobbyists who will shift into new jobs in the Beehive? We are starting to see who some of the individuals taking up the top jobs will be. For example, former National staffer Jo de Joux has been running a lobbying company in recent years but has now been appointed National Party general manager after successfully running National’s election campaign.
The Beehive has also employed a new press secretary, Rebecca Dunlay, who has a six-year background working in PR-lobbying company, Convergence Communications & Marketing. Matt Young comes into Beehive comms from a career with PR companies like Pead PR and Anthem, and Lesley Hamilton comes straight from being the communications manager for Seafood New Zealand.
Any new government is vulnerable to being captured by vested interests as it starts restructuring, so it’s important to have public scrutiny of who is coming into the Beehive as advisers, trainers, or spin doctors. When these people come from lobbying and corporate PR backgrounds, it’s wise to ask who might benefit from those connections.
Surging oil prices threaten to put the skids on Britain’s battle against inflation – as figures show it is proving harder than expected to defeat.
Brent crude climbed to as high as $93 a barrel after a deadly blast at a Gaza City hospital stoked further tensions in the Middle East.
If sustained, higher oil prices could feed through to the cost of petrol and diesel.
Figures published by the Office for National Statistics (ONS) yesterday showed rising fuel prices are a hurdle in the fight against inflation, which stayed at 6.7 per cent in September.
Economists had expected the consumer price index measure of inflation to fall to 6.6 per cent.
There was some cheer for supermarket shoppers as food prices fell by 0.2 per cent, the first decline since September 2021.
But that was offset by the increasing cost of filling up, with petrol up 5.1p a litre in August and diesel up by 6.3p.
Victoria Scholar, at Interactive Investor, said: ‘Rising oil prices have pushed motor fuel prices higher, offsetting to some extent the impact of the Bank of England’s aggressive stream of rate increases on the headline rate of inflation.
‘Further increases in oil prices could derail inflation’s path back down towards more normal levels and could pave the way for further monetary tightening from the central bank.’
Experts still think UK inflation is on its way down with a big fall expected when October’s figures are published next month, due to lower gas and electricity bills. Ofgem’s energy price cap was cut at the start of October.
HOW THIS IS MONEY CAN HELP
However, the volatility on energy markets triggered by the Hamas atrocities in Israel, which has pushed up gas prices in Europe as well as oil, is being monitored by central banks and Government officials.
For markets, the fear is that the conflict could spread across the Middle East, disrupting oil supplies. At the heart of this is Iran, a regional power player and backer of Hamas, which is the subject of US sanctions.
Iran’s foreign minister Hossein Amir-Abdollahian yesterday urged Middle East governments to impose an oil embargo on Israel – though sources from the OPEC+ cartel have said that it was not planning to take any immediate such action.
Analysts are closely watching how Israel’s military response unfolds. Vivek Dhar, of Commonwealth Bank of Australia, said: ‘A long occupation looms as the scenario that pushes Brent oil futures above $100 because it raises the risk that the Israel-Hamas conflict expands and potentially draws in Iran directly.’
Other factors are also pulling oil prices higher – with US crude stocks being used up more quickly than expected and China reporting stronger than expected third-quarter growth.
But it is the Israel-Hamas conflict that looms largest for now, and overshadowed last week’s meetings of the International Monetary Fund (IMF) and World Bank in Marrakech, Morocco.
IMF chief economist Pierre-Olivier Gourinchas said that a 10 per cent rise in oil prices could lop 0.15pc off GDP growth next year and add 0.4 percentage points to global inflation.
Firms face £2bn business rates hike
Firms face an estimated £1.95billion business rates hike next spring as a result of yesterday’s inflation figures, says property consultancy Altus.
Rates typically rise in April in line with the previous September’s consumer prices index reading – though this year they were frozen.
Altus said firms in 2024 can expect a ‘double whammy’ as business rate discounts applied to retail, leisure and hospitality premises, worth £2.4billion, expire just as higher rates come into effect.
Alex Probyn, at Altus, said: ‘Clients tell us that the business rates burden is a disincentive to invest and are at an unsustainable level.’
Altus said £415million of the hike expected in April would be shouldered by the retail sector.
Trade body UK Hospitality said restaurant, pubs and bars face a £234million bill as business rates rise and a £630million hit when the rates discount ends – and called for the Chancellor to reverse both.
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New Zealand billionaire Graeme Hart is selling up some prized real estate. Photo / Getty Images
The Business Herald’s new column offers insight into what those on the inside of the property industry are talking about, what worries them, what they’re celebrating, the rises, the falls and who’s doing what.
Heel, you property managers
All on the move – Fisher & Paykel x 2
Sir Bob’s sense of humour
Kiri Allan has branched into consultancy. Photo / Mark Mitchell
Former high-profile Labour minister Kiri Allan has launched a new consultancy business, months after leaving her Cabinet role due to a car crash in Wellington.
Allan recently pleaded not guilty to a charge of refusing to accompany police, which arose from alleged offending in late July.
The ex-Justice Minister also faces a charge of careless driving for the incident, in which she crashed into a parked car on Roseneath’s Evans Bay Parade.
Allan’s first court hearing has been put off twice and is now due to be held in the Wellington District Court in November.
Allan, who resigned her ministerial portfolios after the crash, also announced she would not be standing for re-election this year.
She has now launched a new business, KLA Consulting. With the tagline “efficient and effective: solving your problems”, the site for her business promises to provide “strategic advice” to help businesses “cut through to solutions”. She would be able to advise on economic growth and regional development.
“Kiri Allan is ready to tackle any challenge and put you on the path to success,” the site said.
“A proven track record of getting things over the line, Kiri will not waste time for you or your business. She will provide you with free and frank advice on how to get the solutions to the challenges you face in the most effective and efficient manner.
“A former Cabinet Minister and lawyer, Kiri has committed her professional life to finding solutions to some of the most complex situations and is willing to do this for you too.”
The site also described Allan as someone with a “reputation for getting things done”, with a skill for communicating complex material to a broad audience.
“A clear analytical and strategic thinker, she will provide candid advice as to the most effective and efficient way to get projects across the line. She had also been described as a ‘chaos-tamer’, a leader, an effective decision maker and a catalyst for forward-looking change.”
The consultancy “can help you expand what is possible for your business”.
A phone number listed on the site went to a voicemail introducing Allan as an MP.
Melissa Nightingale is a Wellington-based reporter who covers crime, justice and news in the capital. She joined the Herald in 2016 and has worked as a journalist for 10 years.
A major investment was announced Oct. 12, which will help families afford new homes in a Birmingham community.A news release stated Regions Foundation leaders joined the East Lake Initiative to break ground on new homes and present a grant of $400,000 supporting the construction projects.“Where we are standing today was just an empty lot,” said Marta Self, executive director of the Regions Foundation. “Before long, it will be a home. It will be a place where the family can build generational wealth. It will be one of 15 houses ELI is building as part of an exciting new chapter in how the organization connects people with affordable housing and we are proud to support ELI in this transformational work.”ELI was founded in 2010 and works to provide community development within Jefferson County.“None of this would be possible without the support of community partners, volunteers and residents who believe in our vision and share the goal of creating a stronger Birmingham where more people have access to what they need to thrive,” said Myron Thomas, chief operating officer of the East Lake Initiative. “These new houses will send a powerful message to East Lake and Birmingham as a whole, and that message is there are people and organizations who are ready to invest in the future of our neighbors and the vitality of the neighborhoods that form this great city.”
A major investment was announced Oct. 12, which will help families afford new homes in a Birmingham community.
A news release stated Regions Foundation leaders joined the East Lake Initiative to break ground on new homes and present a grant of $400,000 supporting the construction projects.
“Where we are standing today was just an empty lot,” said Marta Self, executive director of the Regions Foundation. “Before long, it will be a home. It will be a place where the family can build generational wealth. It will be one of 15 houses ELI is building as part of an exciting new chapter in how the organization connects people with affordable housing and we are proud to support ELI in this transformational work.”
ELI was founded in 2010 and works to provide community development within Jefferson County.
“None of this would be possible without the support of community partners, volunteers and residents who believe in our vision and share the goal of creating a stronger Birmingham where more people have access to what they need to thrive,” said Myron Thomas, chief operating officer of the East Lake Initiative. “These new houses will send a powerful message to East Lake and Birmingham as a whole, and that message is there are people and organizations who are ready to invest in the future of our neighbors and the vitality of the neighborhoods that form this great city.”