Coronavirus sends luxury real estate rental market soaring
The Hamptons, Westchester County, Nantucket and more beach towns see surge in real estate rental market
Rogers Healy & Associates real estate owner Rogers Healy discusses efforts to prevent foreclosures going up during the coronavirus crisis.
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The luxury real estate rental market is heating up early in summer beach towns despite officials calling for travel restrictions due to the coronavirus pandemic.
An influx of people leaving New York City, an epicenter of the coronavirus, is overcrowding wealthy enclaves in New York like the Hamptons and parts of Westchester as well as Nantucket and Martha’s Vineyard in Massachusetts.
“Rental season is starting earlier now. Instead of Memorial Day, it’s April 1. My colleagues around various agencies have been getting calls … it’s a very proactive time,” Jonathan Davis, a Southampton, Long Island-based luxury real estate adviser for Nest Seekers, a brokerage, told FOX Business.
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Davis says his Bridgehampton, Long Island, office has done $2,500,000 in rentals in the last two weeks alone, a 30 to 40 percent increase compared to the same time last year. Clients are looking for April and May leases with the option to extend them for the full summer through Labor Day with average rental home prices ranging between $10,000 to $25,000 per week.
“The response from our tenants has been, 'there is just more room to breathe out here' and families feel safer,” Davis said, adding that grocery stores have restocked amid shortages and restaurants are opening ahead of the summer season, offering take out. “[It’s] not a bad environment to be quarantined.”
More than 46,000 people in New York state have tested positive for the coronavirus and New York City has been hit particularly hard, leaving state and local officials struggling to find more hospital beds and personal protective equipment for health care workers.
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Westchester County, a suburb 30 minutes north of New York City, has also seen a surge in demand from families looking for rental properties outside of Manhattan.
"We're getting much more inquires coming to Westchester," Mimi Magarelli of William Pitt/Julia B. Fee Sotheby’s International Realty said. "People are really uncertain and finding Manhattan a little confining. If you have three kids in a two-bedroom apartment, you're getting a little stir crazy."
Magarelli says that renters are looking for fully furnished homes to rent through the summer.
"We don't have enough inventory. We're asking owners if they'd want to convert homes into furnished rentals for a couple of months," Magarelli said.
Sotheby’s International just listed a waterfront mansion in gated community Premium Point in Mamaroneck, Westchester County, for $50,000 a month. The 7,792-square-foot home boasts seven bedrooms, nine full bathrooms and a multimillion-dollar art collection.
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"It's sort of a Hampton's alternative," Margarelli said, explaining that Westchester home rentals typically range anywhere from $8,000 to $20,000 per month for the average four-bedroom home. "When you combine waterfront, pool and multimillion-dollar art its gets into another stratosphere."
Private jets have poured into places like Martha’s Vineyard and Nantucket in recent weeks, with several thousand people landing in Nantucket alone. The island off Cape Cod with just one hospital has only 17,000 year-round residents but as many as 50,000 in the summer.
With more people fleeing to smaller beach towns with limited hospital space, officials are pleading that they stay away during the COVID-19 pandemic. Nantucket Cottage Hospital CEO Gary Shaw told the Lily hat Nantucket is a “medical desert” with a shortage of doctors, no intensive care units and just 14 hospital beds and three ventilators.
And supervisors of Southampton and Southold on the North Fork of Long Island are concerned that the number of coronavirus cases will spread as more people flock to East End communities to rent or retreat in their second homes.
There are three hospitals in the East End in Greenport, Southampton and Riverhead with around 334 beds altogether, and they are working to comply with Gov. Andrew Cuomo’s mandate to increase the number of beds by at least 50 percent to treat COVID-19 patients. However, equipment is in short supply, Riverhead Local reported.
“It is simple math, the more people that come, the greater the spread and the greater the confirmed cases,” Southold Supervisor Scott Russell said Thursday, according to Riverhead Local.