Beach Rentals 2011: Boom or Bust?
Want to know if the recession is really over? Watch this space in two months for the answer.
Using the high-end summer beach leases in Malibu and the Hamptons as a barometer, it looks like the prices being asked for seasonal rentals are as high as ever--up to $150,000 a month for a place in Malibu Colony and a whopping $600,000 for the season in the Hamptons.
But asking isn't the same as getting, as the many homeowners who've had their houses listed on the market for more than a year will attest.
Typically, the beach rental market works like this: Properties get listed in March or early April, and if a tenant hasn't signed on by mid-May--with the Memorial Day weekend looming--home owners tend to soften their price expectations and become more willing to negotiate. By June 15, they're just plain hollering at their listing agents.
For the past two summers, there's been a lot of hollering in mid-June.
In Malibu, the summer beach rental scene has been bolstered in recent years by corporate sponsorship. Big corporations rented out homes, then threw no-holds-barred beach bashes for invited A-list celebs. Along came the paparazzo, who photographed the celebs standing near the sponsor's high-end LCDs or top-of-the-line kitchen appliances. It's product placement (for both the refrigerator and the celeb) and apparently everyone was happy with the arrangement--except for the neighbors, who generally didn't appreciate 1,000-guest beach parties that lasted 24 hours. The city of Malibu has since instituted party rules, which limit the number of guests to 100 at a time without a permit and shuts down the festivities after eight hours. Regular party poopers, those guys.
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In the Hamptons, listing prices appear to be soaring with the eagles. Again, it's a situation of waiting and seeing what the market will bear, but agent Gale Penny Conetta of Saunders & Associates has a 5,000-square-foot home listed for $475,000 for the season in Amagansett. (If you're thinking about pooling your resources with a bunch of friends, forget it: Group rentals are seriously frowned upon, says Conetta.)
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She notes that prices in the Hamptons for summer places haven't increased this year over last, but homeowners are getting their asking prices, which is an improvement over the past few summers. Paul McCartney has been leasing the same summer house for years, and Alec Baldwin, Christie Brinkley, Jerry Seinfeld and other celebrities are frequently spotted on the beach and around town.
For more modest budgets, $110,000 a month will get you a seven-bedroom house on a little more than acre in East Hampton. If only you could see the beach from there.
