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Home Sales Have Plunged

Wed, 10/30/2019 - 13:36

East End home sales in the third quarter were at an eight-year low, and the inventory of houses on the market has reached a 13-year high, according to a report from the Douglas Elliman Agency.

Sales over all have declined for the seventh quarter in a row, the agency reported. Sales of houses priced at or above $5 million were at their lowest level since 2013.

The slowdown in the real estate market continues to have an adverse impact on the Peconic Bay Region Community Preservation Fund. Revenues so far this year total $58.2 million, Assemblyman Fred W. Thiele Jr. announced on Friday, compared to nearly $73 million in 2018 — a decline of over 20 percent.

The preservation fund, which provides money for land preservation and water quality improvement, receives the proceeds of a 2-percent real estate transfer tax in the five East End towns: East Hampton, Southampton, Shelter Island, Southold, and Riverhead. Over the first nine months of the year, C.P.F. revenues from home sales fell 27.8 percent in East Hampton, 19.2 percent in Southampton, and 31.4 percent in Riverhead. Shelter Island’s were up 27.3 percent, and Southold’s increased by 6 percent.

Looking for a silver lining, Mr. Thiele said the 20-percent decline in overall revenue was an improvement from earlier this year. In May, C.P.F. intake was down 27.4 percent. Still, September’s intake, $5.38 million, was the lowest since March, when $4.56 million was collected.

The Douglas Elliman report attributed the slowdown in the real estate market to the 2017 tax reform law, which placed a $10,000 cap on the amount of state and local taxes — including property taxes — that can be deducted on federal returns. That cap, the report said, has made houses on the East End even less affordable.

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