RENTALS: August by the Beach? It’s Not Too Late

The surplus of unrented properties stands in stark contrast to six or seven years ago

    It may be the second week of August, but it’s not too late to rent a house on the East End.
    Depending on the firm, a search on a real estate company’s Web site will render between 400 to around 500 available rentals from Montauk to Water Mill. Each company compiles its own rental listings, but according to Lynn Epstein, an owner and director of sales at Devlin McNiff Halstead Property in East Hampton, 80 percent of them overlap between agencies.
    The surplus of unrented properties stands in stark contrast to six or seven years ago, when virtually every property was rented from Memorial Day to Labor Day. “More homeowners are leasing out their properties than in the past,” Ms. Epstein said. “The supply outweighs demand.”
    Contrary to common economic principles, prices have not come down despite the surplus. According to Jan Robinson, a longtime local real estate broker and builder, many homeowners haven’t lowered their prices because they don’t deem it worth the effort to vacate unless they get their asking price. “People are keeping their prices steady, and some care more than others whether their house is actually rented,” Ms. Robinson said. “It’s often a difficult decision to make, whether the rental income is better than a summer at the beach.”
    Cindy Shea, an associate broker and vice president of Sotheby’s International Realty in Bridgehampton, reported a strong rental season, “but not as strong as last year.” She says that many renters became buyers in the past 12 months, particularly in the $1 million to $2 million range, which partially explains the high number of unrented houses.
    There is an exception: If you want to rent in Montauk, you’re basically out of luck. According to Ms. Epstein, there were originally more than 150 properties in Montauk’s August rental pool, and now there are only a handful of options, most with a price tag that exceeds $50,000 for the month.
    It’s a phenomenon that would have gratified Carl Fisher, the early 20th-century developer who strived to transform Montauk into “the Miami Beach of the north.” He failed largely due to the Great Depression and financial misfortune. But his dream hasn’t died. Montauk has become a haven for nightlife, restaurants, and sport, aspects that merit the extra commute to “the End.”
    On the other end of the spectrum are East Hampton and Amagansett, where there are hundreds of un-leased houses. With so many options, it can be difficult to choose. Ms. Epstein pointed to a new, two-bedroom, three-bathroom, 2,200-square-foot house, with a heated gunite pool, on the lanes of Amagansett, listed for $40,000 for August to Labor Day (the price would be prorated depending on the move-in date) and $50,000 for August through September. She also highlighted a three-bedroom, three-bathroom, 2,000-square-foot house, with a heated pool and sunset views on Gardiner’s Bay, for $16,000 for any two weeks.
    Weekly rentals are increasingly common, as they offer lower-priced alternatives to the lessee — something is better than nothing for a homeowner who failed to lease his or her property for the month or season. Moreover, owners who rent their houses for less than two weeks are not required to report the income to the Internal Revenue Service. In East Hampton, however, a town law limits the number of times someone may rent their house for a period shorter than two weeks.
    Ms. Robinson’s favorite available property is a five-bedroom, five-bath house, on four acres with a tennis court and pool, in the Northwest area of East Hampton for $10,000 per week.
    Of course, amenities are great, but the best deals can be found in properties without a swimming pool. And if price doesn’t matter, Sotheby’s Web site returned more than 60, $100,000-plus options still available, from Montauk to Water Mill.
    “There are still several properties in all price ranges,” Ms. Shea said. “It’s certainly not too late to escape and enjoy the end of summer here.”