I have a small house in the Hamptons. Bought it the last time the market cratered. It's smaller than the average suburban home. Thing is, a vacation house used to be a small place. A place where you went to unwind, sit on lounge chairs, listen to birdsong, peepers and crickets, smell fresh air and maybe plant some flowers.

The difference between the last time the market cratered (1992-93) and now is that you could buy a small house back then for the price of an average suburban home. Now, you can't touch the few small houses left. They go for well more than half a million and they are tear-downs. The "houses" being built here in the past 10 years are the size of hotels. They are truly obscene, especially when one considers the majority of them are used for 8 weeks a year. They've been placed in areas which used to be scenic -- along the edges of a pond, for example -- but the houses (and so the scenic vista of the pond) are now shielded from the public by twenty-foot tall privet hedges with an inner core of arborvitae. Not only has the size and price of a home been blown out of all proportion, but the pretty scenes that made this area desireable are now hidden from the view of anyone who can' afford a minimum of 10 million dollars. Not only that, but locals badgered the town to change zoning laws so that outsized houses could be placed on pint-sized lots. The locals wanted to sell their ranch houses on a quarter of an acre for a million dollars as tear-downs and retire to Florida. Well, they got their wish and now huge, hulking edifices take up the entire ground space of tiny lots, save for the two or three Hamptons-required hydrangea bushes for "landscaping."

For years we've heard "The high-end luxury market always retains it worth, or at least does better than the lower end in a recession." Umm, not this time. Every other hulk out here has a For Sale sign in front, and a "For Rent" sign underneath that. I believe Jon Corzine has his house for rent for something like 999,000 for the summer months.

And I am very happy wit my bare bones little house. I listen to the birds, plant flowers, stroll through the few remaining fields and go to the quieter beaches, away from crowds. Well, maybe not so many crowds anymore. Sure, there are still plenty of rich people, but the numbers of social climbers who were about to embark upon the ownership of an energy-sucking 10,000 sq ft hulk requiring oil, AC, pool maintenance, housekeeping, lawn-mowing, winter insulation, etc has really dropped. If only the excess of humongous empty houses could disappear and the land go back to being fields and woods and waterscapes.

From one who remembers the Hamptons as where Arthur Treacher quietly drank his time away at the Dune Deck and surfers (!) owned the beaches...

Now if same thing could happen in the mountains of North Carolina, then maybe my poor husband's family will finally be able to afford their property taxes again - all the out-of-town richies who've bought and built million dollar houses up there in giant horrible gated communities have made it almost impossible for actual locals to retain their land. Hallelujah for the recession, in that sense.

Nice analysis, thanks. I'm grateful for the federally-owned beach and the sleepy town adjacent to it where I go each year. If it weren't for that, I'd never get to see the ocean.

are public in the Hamptons - thanks to the Army Corps of Engineers.

The problem is that with land prices the way they are, you can't afford to have a little beach shack on 1/2 million worth of land.

If you weren't allowed to build a hotel on a shack-sized lot, it wouldn't be worth $1/2 million. I think that's what has kept my favorite beach town a good place to go: they must still have the zoning laws to keep a normal year-round community going.