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Buyers Push Demand for New Construction on the South Fork

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Completed and sold in 2013, this Glover Street residence was built by DeMarco Development. A second new home is currently under construction, also on Sag Harbor’s Glover Street. Photo courtesy of Douglas Elliman. 

By Amanda Wyatt

Historic homes have long been part of the fabric of Sag Harbor, a village celebrated for its old-fashioned charm. But newly constructed houses, rather than repaired or renovated historical houses, are beginning to dot this landscape—perhaps heralding the dawn of a new era for the village.

“What we’re talking about is the economy more than anything,” explained Leslie Reingold, an agent with Sotheby’s International Realty. “The building going on is sort of a synchronicity of factors. One, the economy picked up. Two, Sag Harbor became very hot and still is…It’s like Sag Harbor has come into its own.”

“Because of the publicity of the Bulova Watch[case] condos, so many more people are becoming familiar with Sag Harbor. Sag Harbor has always been one of the most beautiful and authentic seaside villages. When I finally found a piece of property in the village I was determined to build a Federal style home in keeping with the history of Sag Harbor,” said Toni Curto of Curto, Curto and Curto, LLC

As the village enters into a new era of growth and expansion, the real estate market will likely continue to reflect these changes.

“New construction is a very active segment of today’s market and most older homes purchased are being renovated so extensively they are like new,” agreed Gioia DiPaolo, office manager and broker with the Sag Harbor branch of Douglas Elliman.

As she explained, the trend of building brand new, yet traditional-looking homes has been around for over a decade, although it’s undoubtedly picked up recently.

“In the Village of Sag Harbor, [builder] Bob Tortora started a trend over 10 years ago creating new homes that reflected period architecture but offered all the interior proportions and amenities of a new home—the best of both worlds,” DiPaolo pointed out. “DeMarco Development has brought this concept of ‘the new old house’ forward, now completing the second of three historically referenced new homes on Glover Street. These homes incorporate reclaimed wood for flooring, antique lighting fixtures and moldings, and, for the most part, Greek Revival architectural design.”

“On the fringes of the historic village we’re seeing new construction by developers well known throughout the Hamptons, but new to Sag Harbor, for traditional homes offering large square footage and lots of amenities,” DiPaolo noted.

As some realtors noted, the trend of new construction is not so much a shift away from historic homes as it is a practical response to finding space in an ever-growing village. Historic houses, particularly the architectural gems on Main Street, are somewhat hard to come by, and what does exist can be pricy.

Besides, restoring or renovating an older home often comes with unforeseen challenges and difficulties. Buyers may “not know what they’re going to find” once they begin renovating or restoring, Mala Sander, a broker with the Corcoran Group’s Sag Harbor office, pointed out.

“I always call it the ‘you might as well’ factor. Once you get to a certain point, if you’re going to change the floor here, we might as well change the floor there…and then we might as well change the cabinetry and get new appliances, you might as well [tear down the structure],” she said, adding: “When you have homes that aren’t architecturally significant or that interesting there’s no real point to renovating those. It’s best just to take those down. So developers are seeing an opportunity in that, either in open space or tear downs and putting up what today’s buyer wants.”

Curto added that one “of the advantages in building a new home is that we can influence the design and finished product, although it is always still exciting to renovate an older structure.”

However, some agents noted that the market for new homes is usually entirely separate from the market for historic homes.

“I think people that want houses want new houses and people who want historic want historic. I don’t think that it’s really the same buyer. People who want something beautiful and historic will want to do the renovation, and they’ll do it with love and care because they really value the history aspect of the older home. The person that’s buying the new house wants the simplicity of not having to deal with the unknown; they value different things,” said Sander.

“It’s hard to even put the two together in the same sentence,” Reingold agreed. “It’s a whole other animal.”

For those interested in a historic home, renovation and repair is a true labor of love.

“If you’re renovating something that’s beautiful and worth renovating or restoring, yes, it can be very costly to [do so], as opposed to starting from scratch,” Sander said.

“There’s not much of it and what you’re getting is very expensive. 900 square feet for, let’s say, a million, and you’d have to put in [hundreds of thousands of dollars] in maintenance,” said Reingold.

“Not only is it maybe 400 dollars per square foot more to renovate a historic home,” she estimated, “there are very few highly skilled craftsmen and artisans around. A lot of the details [on historic homes] were handcrafted. In all honesty, if you could replicate a historical home for a reasonable amount of money, I’m sure you’d have more people doing it.”

As Reingold pointed out, many people—particularly those with families or those who own multiple homes—simply do not have the time to constantly renovate a house. It can take four times as long to renovate a house as it would to put up a new structure, she said.

Furthermore, many buyers come to Sag Harbor with the intent of having a spacious home, with plenty of room to entertain friends and family. At the same time, “people want to be closer to town” than in previous times, and this presents a problem. Lots in the village tend to be small, and aside from a few of the grand historical homes, many historic structures are tiny by contemporary standards.

It isn’t uncommon for a historic house to have 150 square foot bedrooms, with only one bathroom down the hall, Reingold explained. Even if a buyer decided to gut the house, it may not accommodate the number of bedrooms and bathrooms—as well as amenities and technological extras—that many buyers desire.

“One new thing everybody seems to want now is a downstairs master bedroom. Most of the older structures don’t even have downstairs master suites,” said Sander.

Buyers often prefer homes with an “open flow, open floor plan…[especially] the open kitchen, which people use today as gathering rooms. And then you have the convenience factor, some people out there like laundry rooms on multiple levels, and I’m not even getting into the appliance and amenity factor, just high end kitchen appliances and all that,” she added.

DiPaolo echoed Sander’s comments: “Lifestyle preferences have evolved to a more casual style, with a focus on the kitchen as the place people gather, and floor plan, flow and proportion of rooms now need to be more open with higher ceilings in order to appeal to today’s buyer. The amenities in a new home are, of course, a big draw whereas the time and expense of a renovation project is a proposition many buyers don’t want to endure.  However, for those buyers who value history, renovating a historic home can be a real labor of love.”

While Reingold agreed “size is a huge factor,” she pointed out that “[in the past], construction loans were impossible to get, so that also meant there was no inventory when people were coming out to buy.” She also added that keeping historic structures up to code is also a challenge. There is more leeway with new homes, since the village is less concerned with preserving their architectural integrity.

Another reason why buyers are opting for new construction is that “they’re more energy efficient, they’re less maintenance intensive, it’s going to be more of what you want and less of a compromise, when you’re renovating an older house there’s always compromise between what you really want to have and what exists,” said Sander.

At the same time, DiPaolo pointed out, “Selling a new home that is under construction can be challenging especially when the buyer wants to customize everything. It just takes much longer to bring a deal to closing. However, new construction does come with warranties which is very comforting to a buyer.”

Of course, for those who desire the feel of an older home with all of the modern conveniences, there is the option of using an old architectural plan while building a new home. Some new constructions are being designed with traditional architectural elements, which may help bridge the gap between new construction and historic buildings.

Curto said that she selected an architect for one of her Sag Harbor building projects because he was “very familiar with historic homes and has a passion for them. Once you find your team they will work with you on designing a Federal style home but offer you all the amenities such as a chef’s kitchen, old world moldings, (custom cabinetry built-ins) and beautiful floors.”

Still, as the village itself rapidly grows and changes, architecture will undoubtedly reflect these shifts. But with so many new structures being erected, could Sag Harbor lose a little bit of its old-fashioned charm?

“Yes,” Reingold answered. At the same time, she predicted the village would never entirely lose its historical appeal. Sag Harbor’s rich local history and charm will continue to be a draw for prospective buyers of both new and older homes.

“People are still going to keep coming here because of the historic charm and the quaintness, and more importantly, the vibrancy of Main Street,” she added.