March Continues February Trend of Fat Middle – High End Showings Up

GREENWICH REAL ESTATE MARKET REPORT FOR 3/21/15
We have 83 sales of single family homes in Greenwich so far this year. Of those houses 24 of them have been in the first three weeks of March. Now the average sales for the whole month of March over the last 9 years has been 41 sales so we are likely to finish the month below this average. However, in March 2013 and 2014 we only had 35 and 31 sales. Last year was another harsh winter and our sales should be the 31 sales in March 2014.

The price distribution of the sales continues to follow the pattern that we saw in February with a fat middle and skinny ends. Under $1M we have only 4 sales while over $4M we also only have 4 sales none of which are over $6M. Our high end buyers seem to be enjoying their winter houses whether on the ski slopes or at the beach.

At the low end there are just fewer places to put the snow. Sellers are holding off on listing their houses until they get rid of these piles of snow. So far this month we have had 74 new listings and only 12 have been under $1M. Of those 12 new listings 4 are already under contract and one was a private sale that listed and closed the same day for a net gain of only 7 listings.

The middle price range in Greenwich continues to be where the action is. Sixteen of the 24 sales have been between $900K and $3.1M.

Contracts are looking good with 41 new contracts so far in March. Of those 41 contracts 33 are fully executed and waiting to close and 18 have contingencies. Amazingly inventory has actually shrunk from 468 houses at the beginning of the month to only 452 listings today.

I would expect a real explosions of listings in April as owners who have been waiting for better weather put their houses on the market. One worrisome trend that we are seeing nationwide is that move-up owners in this low inflation environment are taking more years to build up enough equity so that they can move up to a larger house as their families expand. Banks are addressing this issue by making more loans available where the move-up buyer can put down less than 20% thus requiring less equity appreciation.

On the plus side showings of high end homes are looking up, at least if my experience is any indicator. I’ve had three showings of my $8.7 million listing at 26 Wooddale and have a showing scheduled of my $5M lakefront listing in New Fairfield. Interestingly, none so far are from the financial community, but are from China, a dotcom and Westchester County.

I’m betting we will have more than the 700 sales that we had last year, but only time will tell how these countervailing trends will balance out.

 

Greenwich has Record Mid-Market Sales – Feb. Cold Hammers Low- and High-End Sales

  • Best February sales in years
  • Sales and contracts from $1 – 3M are top sellers
  • Market under $1M has low sales due to limited inventory
  • Market over $5M has few buyers in record cold

 

A Record February – Mostly From a Tight Price Range

February 2015 was not only a record cold and snowy month, it was also a record month for Greenwich real estate. We had 41 single family home sales in Greenwich in what is traditionally the slowest month of the year. These 41 sales are more than we’ve ever had in February in last decade. They are also almost 50% more than January’s 28 sales.

Sales.SFH.2013-FebFNL2015.031415

 

The curious thing about the sales is how concentrated they are. Two-thirds of the sales are between $1 million and $3 million even though it only covers one-third of our inventory. Outside of this price range sales have been slow so far this year.

As of 3/5/15 Inventory Contracts Last Mo. Solds Tot. Solds+ Contracts YTD Solds YTD+ Contracts Mos Supply Mos w/ Contracts
< $600K 7 2 2 4 5 7 2.8 3.5
$600-$800K 11 2 1 3 2 4 11.0 9.6
$800K-$1M 13 3 2 5 2 5 13.0 9.1
$1-$1.5M 40 13 8 21 15 28 5.3 5.0
$1.5-$2M 43 21 9 30 12 33 7.2 4.6
$2-$3M 66 15 8 23 13 28 10.2 8.3
$3-$4M 59 11 1 12 3 14 39.3 14.8
$4-$5M 53 4 1 5 1 5 106.0 37.1
$5-10M 98 9 3 12 4 13 49.0 26.4
> $10M 48 0 1 1 2 2 48.0 84.0
TOTAL 438 80 36 116 59 139 14.8 11.0

Sales Slower Under $1 Million – Little Inventory, Even Less New Inventory

Greenwich is a great place to live and as a result we never have enough inventory under $1 million. Usually we see 3 – 5 months of supply in this price range. Now we have 3 – 13 months of supply even though we only have 31 houses listed under a million. Most of the listings we do have were put on last year or even before and are selling slowly. In this price range days on market are normally measured in days and weeks not months.

Feb2015.MosSupply.030615

Clearly our cold, snowy winter is keeping owners from putting their houses on the market. Normally, listings start coming on after Super Bowl, but this year owners have held off waiting for better weather.

The problem with this price segment as I wrote in the 2014 annual report is that low inflation and single digit house appreciation is slowing the equity build-up needed for the move-up market. Sales under $1 million dropped last year despite strong demand from buyers due to the lack of sellers.

Families are not only staying in their start homes longer waiting to build up enough equity to make a down payment on their next home, they are also renovating and expanding. Both actions are reducing market inventory and this trend continues all the way up to $2 million in Greenwich.

The High End Market – Harsh Winter, Slow Sales, Contracts Starting to Perk Up

Last year was a good year for high-end sales in Greenwich, in fact the best year since the recession. With Wall Street up, good 2014 bonuses and prior years of deferred bonuses vesting, we should be looking at good sales in 2015. So far this year we have had only 7 sales of houses on the GMLS over $4 million plus we have had 2 private high-end sales over $10 million. We still have a ways to go with an inventory of 199 houses over $4 million.

Over5MMSales.K.1-2.2015.mp.030615

On the good news side 24 of the 80 contracts are for over $4 million so months of supply will be dropping as the red bars show in the chart above. Sales in the $5 – 10M price range and $3 – 4M will perk up over the next couple of months as the 20 contracts in these price ranges close.

Inventory, Sales and Contracts

The hard winter has effected inventory at all levels. We only have 438 listing when we should be closer to 500. Clearly, there is a shortage under $1 million and the market is tightening rapidly all the way up to $2 million.

Feb2015.Inv.Sales.Ks.030615

Sales have really only been strong in a narrow range of $1 – 3 million, but there they have been very strong, when compared to prior years. Start with the light blue bars (sales) and stack the red bars (contracts) on top and compare the height to the dark blue bar (inventory) and you can see how fast inventory is disappearing in only two months.

The distribution of the red bars, contracts, are the most interesting with only 7 contracts under $1 million. We’ve got 13 contracts between $4 and $7.5 million and none above. Three-quarters or 60 of our 80 contracts are between $1 million and $4 million.

Percentages & Pie Charts

Another way to look at the market is the size of the pie pieces. In 2015 they look much different than in prior years. If you look at the YTD Solds pie you can see how big the $1 – $3 million market is compared to the inventory. You can also see from the contract pie that it will continue strong. The contract pie chart also shows that the $3 – 10 million market will also be getting better.

Feb2015.Inventory.030615 Feb2015.SoldsYTD.030615 Feb2015.Contracts.030615

 

Summary

It’s early in the year and this market is not indicative of what we are likely to see once the snow melts. Sales over $5 million should pick up nicely as the year goes on. I’d expect a sudden surge of new listings when the snow melts as pent-up listings are put on the market.

Hopefully, 2015 is the year that we see the end of the skittish, post-recession market of two good months followed by a poor month. Our biggest market risk continues to be a dysfunctional Washington. We have had major sales dips when Congress has reached major impasses. The fall of the Euro is a concern, but at the same time it makes the U.S. and particularly Greenwich real estate look like a good place to invest.

Mid-country should stay strong this year and backcountry’s recovery should accelerate. Old Greenwich and Riverside, and particularly SoTra (south of the tracks) will command an even greater premium price. This means that Cos Cob and Glenville will also continue to appreciate as the best combination of square footage, acreage, schools and price for many families priced out of or not willing to pay the SoTra premium.

Builders are going to be much more active both for teardowns and custom built houses and for spec houses. In fact with financing for spec houses finally coming back the builders could see major growth this year.

Now if we can just get this snow to go away, we can a have an excellent 2015.

38 Open Houses in Greenwich on Sunday, 3/8/15

Open House Map.030815

Daylight Savings-Spring Ahead! Remember to set your clocks ahead one hour at 2 a.m. Sunday morning. Hopefully, we had the final storm on Thursday and the forecast is for spring-like temperatures—clear skies in the 40’s to 50’s!! There are 38 Open Houses this weekend with many of them on Saturday. Pay particular attention to the days and times to make sure you plan properly.

The prices range from $299,000 to $6,595,000. Come out and enjoy these beautiful homes.

Please click here for the interactive map. The static map is below.

Thanks to Rob Pulitano for preparing the list of Open Houses and the interactive map and to Pam Toner for the hot links and the Word document attached.

Address Town Price Time
50 Lafayette Place  #1i Greenwich $299,000 1-3 PM
1465 E Putnam Avenue  #311 Old Greenwich $324,500 1-3 PM
147 Putnam Park  #147 Greenwich $500,000 1-3 PM
30 Almira Drive Greenwich $649,900 2-4 PM
16 Idar Court Greenwich $850,000 1-3 PM
15 Strickland Road Cos Cob $879,000 1-4 PM
285 Bruce Park Avenue  #B Greenwich $1,195,000 1-3 PM
1 Northfield Street  #A Greenwich $1,295,000 1-4 PM
11 Suburban Avenue Cos Cob $1,350,000 1-4 PM
41 Leonard Avenue Riverside $1,395,000 1-4 PM
405 W Lyon Farm Drive  #405 Greenwich $1,650,000 3-5 PM
16 Mackenzie Glen Greenwich $1,699,000 1-4 PM
233 Milbank Avenue  #6 Greenwich $1,795,000 Sat  1-3 PM
233 Milbank Avenue  #8 Greenwich $1,795,000 Sat  1-3 PM
43 Riverside Lane Riverside $1,849,000 1-4 PM
30 Chapel Lane Riverside $1,895,000 1-3 PM
39 Oval Avenue Riverside $1,897,000 1-3 PM
233 Milbank Avenue  #5 Greenwich $1,950,000 Sat 1-3 PM
82 E Elm Street  #B Greenwich $1,950,000 Sat  1-3 PM
112 Taconic Road Greenwich $2,000,000 1-4 PM
233 Milbank Avenue  #2 Greenwich $2,050,000 Sat  1-3 PM
40 Riverside Lane Riverside $2,095,000 1-4 PM
233 Milbank Avenue  #3 Greenwich $2,100,000 Sat  1-3 PM
270 Palmer Hill Road Riverside $2,250,000 1-3 PM
38 Byfield Lane Greenwich $2,395,000 1-3 PM
11 Meyer Place Riverside $2,888,000 2-4 PM
75 Dearfield Drive Greenwich $3,000,000 1-3 PM
44 Cedar Cliff Road Riverside $3,400,000 2-4 PM
1 Reynwood Manor Greenwich $3,495,000 1-3 PM
38 Bramble Lane Riverside $3,895,000 1-4 PM
70 Sherwood Avenue Greenwich $3,975,000 1-4 PM
14 Sherwood Farm Lane Greenwich $3,995,000 1-3 PM
8 Willow Road Riverside $4,095,000 2-4 PM
10 Esther Place Old Greenwich $4,295,000 1-3 PM
26 Stillman Lane Greenwich $4,850,000 1-3 PM
22 Stillman Lane Greenwich $4,995,000 1-3 PM
591 Round Hill Road Greenwich $5,990,000 1-4 PM
3 Dunwoodie Place Greenwich $6,595,000 1-4 PM