Pandemic-fueled East End housing boom pushes preservation tax revenues to new highs

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The hot East End real estate market continues to drive up house prices and break revenue records for the Peconic Bay Community Preservation Fund, which is generated by a 2% tax on real estate transfers in the five cities of the East End.

Community Preservation Fund revenue generated in the first five months of 2021 was double that generated in the first five months of 2020 – and CPF tax revenue from January to May 2020 was already the highest total on five months of the fund’s history, which dates back to 1999.

Overall, CPF earnings last year were higher than any year in the program’s history, thanks to rising house prices and high volume fueled by an exodus from New York to the East End as the coronavirus pandemic swept through the New York metro area. The number of sales has set records and the median home price on North Fork has jumped 23.8% in 2020 to a record $ 805,000, according to a report prepared for Douglas Elliman Real Estate by Miller Samuel Real Estate Appraisers and Consultants. The median selling price in the Hamptons in 2020 climbed 54.5% to a record $ 1.4 million, according to Elliman.

And in 2021, the trends continue, with North Fork sales up nearly 60% in the first quarter of 2021 compared to the same period last year and a median selling price climbing to $ 751,000 for the quarter, up 23.4% year-on-year. year, according to a report prepared for Douglas Elliman Real Estate by Miller Samuel Real Estate Appraisers and Consultants. The Hamptons saw “tremendous growth” in the range of $ 1 million to $ 5 million in the first quarter, according to a report from Elliman.

According to Congressman Fred Thiele, from January to May of this year, the fund generated a record $ 93.69 million, up from $ 45.43 million in the first five months of 2020 – and that sum, a 54% increase in the first five months of 2019, was itself the highest five-month total on record in CPF history.

Since its inception, the CPF has generated $ 1.694 billion.

The CPF was established by referendum in 1998, approving legislation passed by Thiele and former State Senator Ken LaValle, to fund the preservation of farmland and open spaces in the East End. In 2006, the CPF was extended from 2020 to 2030, and in 2016 it was extended to 2050. In 2016, voters also allowed spending up to 20% of the CPF’s income on projects. improvement of water quality. In each case, the CPF referendum was passed by a large majority among voters in East End cities. Each city separately manages its fund and administers the programs it finances.

The city-by-city breakdown of CPF revenues generated from January to May 2021, according to data provided by Thiele:

City 2020 2021 Percent increase
East hampton $ 12.34 million $ 31.04 million + 151.6%
River head $ 1.71 million $ 2.86 million + 67.3%
Shelter Island $ 0.69 million $ 2.31 million + 234.8%
Southampton $ 27.6 million $ 51.62 million + 87%
Sudold $ 3.08 million $ 5.85 million + 90%
Total $ 45.43 million $ 95.68 million + 106.2%

“CPF revenues continue to reflect the significant increase in real estate activity in the East End since the advent of the COVID-19 pandemic,” Thiele said in a statement. “This marks the 10th consecutive month revenue has exceeded $ 10 million per month. The past eight months have all exceeded $ 15 million per month.

Alek Lewis contributed reporting for this story.

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