GREENWICH REAL ESTATE MARKET REPORT
Sales are Up
Forty-five single family homes have sold in Greenwich so far this year. This is actually up 7 units or 18% from last year at this time. The really remarkable thing about this increase is that it happened even though dozens of sales were shifted into 2012 to avoid the higher federal capital gains tax and Medicare tax effective in 2013.
Under $1 million and $1 - 2 million
The market under $1 million continues to be red hot and represents a third of the sales so far this year even though this price range has less than a tenth of the listings. The $1 – 2 million market is also fully recovered with inventory and sales in balance and both representing about a quarter of the market.
Over $2 million Market
The over $2 million market is getting much better as buyers are feeling more confident about the market. Many buyers now see this first quarter as the time to buy before both interest rates and home prices move higher. Also many buyers from the financial sector are “fully bonused”. They are getting not only this year’s bonus, but also deferred compensation from prior years.
As a result many financial executives whose bonus awards were down this year, actually are getting more total compensation this year than last year when as their prior years deferments vest. Also, sales in the higher price categories kick in later in the year as executives people wait to see their bonus amounts before they start looking.
Even in this price category houses that are priced well move quickly. The home at 35 Bramble sold in 18 days for $3.5 million which was 103% of asking price. (NB: It was also $100K less than it sold for in 2007 at the peak of the market.)
Greenwich Contracts and Accepted Offers Looking Good
Contracts and accepted offers for the under $1 million price range are lower than sales for the same price range this year, but only because we don’t have enough inventory in that price category. The $1 – 2 million sales market will be moving up as the 37 contracts and offers mature into sales.
At least of most them will get done. This price category is still affected by overly restrictive bank lending. Most of the deals will close eventually, but not everyone ends up financing with their first bank.
At the end of February 2012 we had 86 contracts compared to 94 now or an increase of 12%. We also had a GMLS inventory of 529 house listings or 105 more listings than we have now. Sure would be nice to have an extra 100 listings by the end of the month, but I don’t think we will come close.
The Greenwich Real Estate Market by Neighborhood
The way the GMLS divides the town up over half the inventory is in the two areas north and south of the Merritt Parkway. The south of the parkway area goes down to the Post Road and encompasses a diverse set of neighborhoods, so it’s not really useful as analytic designation. At the other end Banksville and Pemberwick are distinct neighborhoods, but are so small that they don’t show up well on graphs.
The differences among the neighborhoods become a little more apparent when you chop off the top 2/3rds of the graph.
Where to Find the Under $1 million Houses in Greenwich
The purple bars show the under $1 million market is on the west side of town in Byram, Pemberwick and Glenville, but also in Riverside and Old Greenwich north of the Post Road. Surprisingly, Cos Cob with 8 listings under $1MM has the most affordable houses in Greenwich with eight. Byram and Riverside have 6 houses each.
$1 – 2 Million Houses in Every Neighborhood
The most $1 – 2 million listings with 24 are south of the parkway. Surprisingly, the backcountry (known as north of the parkway to the GMLS) has the same number of listings between $1 and $2 million as does Cos Cob, both with 17 listings. Riverside and Old Greenwich both have 11 listings. Byram has 3 listings including a new listing on Byram Beach I just put on for $1.25 million. If you are flexible as to neighborhood you still have a good variety of choices in this price category.
Plenty of Buyers Under $2 million in a Tight Greenwich Market
Only about 20% of our market is priced under $2 million and also has been on the market for less than 6 months. Less than 5% of the Greenwich real estate market is under $2 million and has come on in the last 30 days. And it’s not just single-family homes that are tight; condos, rentals and land are all in short supply. Right now I have clients that are looking for:
- A $800K - $1 million house not too far from the highway, but not on it either
- A 2BR, 2BA house or condo in central Greenwich for around $4K/mo
- A summer rental for $20K/mo
- Anything that is in walking distance to Greenwich Ave. for $800K
- Land for new construction around $900K
My clients in the over $2 million range, are happy with what is out there. They have a lot of good choices.
Below $1 million we often can show people what meets their particular specs in an afternoon, so if you know of any options not presently on market give me, Rob or Jared a call at 203-869-0500.
How to Be the Winning Buyer in a Tight Greenwich Real Estate Market
So far this year 15 families and individuals have bought a house under $1 million in Greenwich. They survived competitive bidding, restrictive financing requirements and a variety of surprises that arose along the convoluted path to purchasing a home in 21st Century America.
Build a Team Early
Everyone knows to get a good Realtor when they buy a house, but you will need other professionals too. If you are going to need financing, talk to a mortgage broker or banker early. Meet with them and build a relationship. Very few financings are pro forma today.
Most buyers don’t think about a real estate attorney until after their offer has been accepted. Be prepared and find your attorney early. Let him or her know your level of experience and that you’ll probably need a quick turn around on the contract rider.
Building inspectors can also be a big help. Once again, speed can be crucial. In a competitive bidding situation you may only have a day or two to inspect the property. The only thing worse than coming in second in a bidding war is winning it and getting a house with problems.
If you are selling your own house and you need the funds from that house to close consult a tax attorney or accountant to see just how much the taxman taketh and ways to minimize the take.
First relax you’ve got a team of advisors if things get difficult. You’re better prepared than most of your completion.
Second, have your mortgage broker or banker pull your credit and check for any problems. Get not only pre-qualified, but pre-approved. A pre-approval letter and shorter mortgage contingency goes a long way when bidding against someone without one. Also now’s a good time to fix your credit score rather than when your loan hangs on getting a higher rating.
If there is some way you can do all cash great. An all cash offer in a competitive bid situation can move you to the top of the list and often reduce your purchase price by $10,000 to $20,000 for deals under $1 million and by as much as $50,000 for deals under $2 million. Consult with your team before you do this. Refinancing later can be tricky and may affect your taxes.
Third, be available. If one of you can’t always take phone calls, what about email or texts. Whenever possible whoever is most available should be able to make decisions for both. Discuss various options in advance so you are both comfortable with this.
Fourth, be flexible and reasonable. Don’t let a minor deal point or few dollars become an ego issue. Work with your team to come up with other options, particularly when the other side is being unreasonable. Don’t yell and scream. The seller has lived in your house-to-be for years and knows all your new neighbors. You want to arrive in their good graces.
Fifth, be human. Let the seller know why you like their place and what it will mean to you and your family to live there. Also try to connect with each person you deal with; don’t become just another case number.
Lastly, have fun. How often will you get to do this. With a good team you’ve got people to talk with. Even if you lose out the first time around you will have gained valuable experience. You will get a house and often a better house at a better price.
Greenwich Open Houses For Sunday, Feb. 17:
This Presidents’ Day eve there are 8 open houses. You can see the list with hot links to the detailed listing info below and see the interactive map here.
Shore & Country
Shore & Country