If you were old enough and smart enough and had the means to buy Hamptons real estate 35 years ago, and you held onto it, you would be doing very well indeed. It turns out all those stories about ridiculously cheap prices are not exaggerated. While the buying power of a 1978 dollar now costs nearly four times as much, Hamptons real estate has gone up by a factor of ten or twenty, and in some prime areas, even more.
The push toward becoming one of the world’s most expensive and prestigious residential resort areas is a story not just of prices but of cultural and sociological change, of shifts in aspirations and ideals and the expectations of a new generation. It’s also about the market. Just a few decades ago land was plentiful and demand was small. Water Mill, Bridgehampton, virtually all of Sagaponack south of the highway and most of Further Lane were unbroken stretches of potato farms. Vast tracts of wooded land north of the highway were untouched by development. Vacant land was still to be had in the estate areas of Southampton and East Hampton. Now parcels eligible for subdivision are hardly to be seen, and teardowns are the only way to enter the estate areas.
Three acres of Sagaponack waterfront cost $375,000 in 1978. In the early 1980s an oceanfront house on Lily Pond Lane set a record at $1,500,000, was resold in 1987 for what was considered an astounding price of $6,125,000, and is worth upwards of ten times that number today.
The Main Streets in our villages were lined not that long ago with a workaday mix of locally owned shops including real estate agencies run by local entrepreneurs. Now, of course, our Main Streets house the brand names of luxury goods companies, and real estate brokerage is predominantly corporate also. At one time a good broker could know every listing in the nearby areas and have some information on most owners; now agents work in teams and marketing departments organize the presentations.
Expectations have changed radically from 35 years ago. Amenities like gyms and wine cellars and outdoor kitchens were not yet listing essentials for the luxury market. In fact, the luxury market as we know it did not generate steam until the mid-1990s with the influx of wealth created in the global financial markets
Whereas Martha Stewart paid $1,600,000 for a fixer-upper on Lily Pond Lane back in 1990, Jennifer Lopez recently paid $10,000,000 for a Water Mill home and Steven A. Cohen just purchased a Further Lane oceanfront house for $62,500,000. The upward pressure on price continues.
The tastes of big time buyers are now established. Moderately large to vast traditional shingle-style homes with all the amenities and expensively casual furnishings prevail. Thinking outside of the cedar shingle box is seen here and there with good Modernism making some inroads. It seems however that the important style transformations have already taken root and no major new trends in building are apparent.
The established estate areas are no longer as demarked as they were 35 years ago. Lines between north and south of the highway have blurred and opulent homes are now located in all parts of the Hamptons. Historic homes in a town like Sag Harbor, in a sort of counter trend, are sought after and have an important place in the market. Small charming and inexpensive cottages on village lanes or out of the way harbors, once a routine part of the market, are endangered species.
Everything changes. Except the reasons we are here: beautiful beaches, bays, ponds, gorgeous light, quaint villages, and interesting people.