Everyone enjoys a nice, relaxing weekend at the beach, but not everyone can afford to own a house in the Hamptons. It’s the reason the Hamptons has a very healthy rental market. Buying a rental property in the Hamptons—or other places, like Long Beach— can create additional income in the long run.
Most homeowners don’t know what being a landlord entails, legally or financially. And although there can be pitfalls (nightmare tenants or a burst pipe in February), renting a summer home in the Hamptons might be as surefire as real estate gets. For instance, some people purchase homes with an eye on retirement and rent them out until they’re ready to move in. That way, the homes are paying for themselves until the owners take permanent residency. And while any old house can be rented, there are steps to making a rental property more appealing, thereby maximizing the profits.
“First, [renters] look for something that’s south of the highway and walkable to the beach,” said Susan Ceslow, a realtor with the Montauk branch of Douglas Elliman Real Estate. “A very nice, neat, clean beachy-style house.” A lot of Hamptons renters take the train from the city and may not have a car, the more walkable destinations there are from the home, the better.
In addition to being near the beach, houses with pools are also very popular and tend to get rented quickly. Ceslow said that a home with a pool can fetch $10,000 more per season in rent than one without one. The more amenities the home offers, the more attractive it is. Some must-have items renters love include central air, an outdoor shower (so they don’t track beach sand all over the house) and a deck for grilling and lounging.
There are costs that come with renting out a home, though. The house has to be completely furnished, which can be expensive. That includes utensils, plates and a full set of kitchen-ware for cooking; couches, chairs, television(s) and a complete bedroom including towels and sheets. “Somebody coming from an apartment who wants to rent a four-bedroom house with beds of different sizes, they don’t want to buy all of that,” Ceslow said. And landlords have to purchase homeowner’s insurance for a rental property.
Décor also counts. Beach themes are popular. But don’t break out the captain’s wheel and overdo things. “We always tell owners, less is more,” said Ceslow. “You don’t want too much clutter in the house. You want it so [the renters] don’t feel like they’re walking into somebody else’s house, they want to feel like they can make their own home.”
Decide how long you want to rent the home (seasonal or year-round), then figure out what a fair rent would be. Look at similar rentals and what they charge, or work with a realtor. Make sure the rent is at least enough to cover the taxes on the home (a good thing to check before purchasing). For instance, a four-bedroom home without a pool could go for $45,000 for the summer season. And though Memorial Day to Labor Day is always a popular time for rentals, the season has started to expand, with more people renting later in the summer and keeping their properties until mid-to-late autumn. Yearlong rentals aren’t as common as seasonal, but there are some people who want to live in the Hamptons fulltime.
Rental agreements can be beneficial to both parties. If everyone walks away happy, many renters will come back to the same landlords year after year. The season is gearing up this month, if a good house can be closed on quickly, it might be possible to start renting this year and take advantage of the early fall crowds.