High End Rentals Greenwich Real Estate Report

By Mark Pruner

Douglas Elliman – Greenwich

mark.pruner@elliman.com – 203-969-7900

One thing that buyers, particularly investor buyers, and sellers want to know is what my property would rent for. Some people think that the high end rental market, over $10,000 per month, has been growing as some people switch from selling their property to renting it. We do have some evidence for that this year, but the post-recession, high-end rental market has remained remarkably stable since 2010.

$10K+ Rented  Avg Price  Price/SqFt DOM  SqFt +/-
2010 86  $      15,700  $      2.17           108        6,671
2011 82  $      15,260  $      2.15             81        6,010
2012 92  $      14,947  $      2.13           100        6,292
2013 95  $      14,800  $      2.32             97        5,824
2014 77  $      16,543  $      3.40             72        5,441
2015 85  $      15,677  $      3.06             92        5,622
2016 47  $      16,297  $      3.07             98        5,490
2016 Annlzd 107
Total or Avg 564  $      15,524  $      2.54             93        5,940
Summer 70
% Summer 12%
Actives 61
Summer 9
% Summer 15%

We average about 85 rentals a year that are listed for over $10,000 plus or minus 8 rentals. The average house is about 6,000 square feet and rents for about $15,500 and is on the market for around 3 months before it rents.

This year the average rental has been higher at $16,300 and if you annualize the 47 rentals we may see 107 rentals for the year, a significant jump over the previous six year average of 85 rentals. This jump may be related to the jump in sales inventory that we have seen in 2016. Right now we have 716 single family homes on the GMLS up over 100 listings from this time last year. Some people put their houses on for both rent and sale so rental listings will go up when sales listings go up.

The people who do this seem to be particularly optimistic about the sale price often listing it for an above market sale price in case some really loves the house. Otherwise they are happy to rent it out which happens the large majority of time when properties are listed for both rent and sale.

graph-1

Rentals >$10K/mo – 2015 – June 2016

Of the 129 sales that have closed in 2015 and YTD 2016, there is a large concentration in Old and Riverside. The other areas that are popular are the waterfront, central Greenwich, mid-country and some back country.

Now you would think that the summer renters would want to rent on Long Island Sound and they do, but these summer rentals which have historically represented about an eighth of our high-end rentals are equally scattered throughout quiet areas of mid-country and backcountry as people, usually New Yorkers, want to get away from the City’s summer heat and noise.

The high end rentals are not evenly distributed by price. We had 564 rentals over $10,000 since 2011, but only 96 rentals over $20,000 month and more than a third of these very high-end rentals were summer rentals.

untitled

At the present time our highest active rental is a summer rental for $100,000 at 40 Walsh Lane available till right after Labor Day. As you get over $20,000 the prices go up pretty quickly so if you are in a tight price range say $22,000 – $24,000 you only have a choice of three listings.

Over $20,000 rentals

The over $20,000 per month market has also been surprisingly consistent with about 15 rentals a year plus or minus one or two rentals. The average price has been $28,800, but here the price range has been more variable probably due to the small number of very high end rentals. Days on market also has varied more year to year due to this smaller sample size, but has averaged out to the same 90 days on market over the last six years as the over $10,000/mo listings.

$20K+ Rented  Avg Price  Sold Price/SqFt  Cumulative DOM  SqFt +/-
2010 16  $      28,458  $      3.18              71         9,368
2011 13  $      28,182  $      3.15              76         7,445
2012 14  $      27,250  $      3.07              87         8,870
2013 16  $      26,400  $      2.73           131         8,603
2014 15  $      31,722  $      5.01              95         7,990
2015 15  $      27,967  $      4.22              64         7,710
2016 7  $      34,214  $      4.32           119         8,327
2016 Annlzd 16
Total or Avg 96  $      28,779  $      3.60              90         8,391
Summer 35
% Summer 36%
Actives 18
Summer 5
% Summer 28%

The house sizes are around 8,400 square feet and acreage is all over the place as renters tend to care less about the size of the lot than do owners. The 18 active listings that we have are scattered along the coast, mid-country and backcountry.

As with everything these days price is crucial in these high-end rentals, but the renters are out there.

May 2016 Greenwich Real Estate Report

By Mark Pruner

Douglas Elliman – Greenwich

mark.pruner@elliman.com – 203-969-7900

We had 55 house sales in May 2015, which will probably match our 10 year average of 61 May sales once the private sales are included. The big story is the other end of the sales process; the 696 single family homes we have in inventory.

As of 6/3/16 Inventory Contracts Last Mo. Solds Tot. Solds+ Contracts  YTD Solds  YTD+ Contracts Mos Supply Mos w/ Contracts Last Mo. Annlzd
< $600K 8 1 4 5 8 9 5.0 5.8 2.0
$600-$800K 24 3 1 4 17 20 7.1 7.8 24.0
$800K-$1M 25 15 2 17 14 29 8.9 5.6 12.5
$1-$1.5M 77 20 13 33 40 60 9.6 8.3 5.9
$1.5-$2M 87 29 12 41 33 62 13.2 9.1 7.3
$2-$3M 117 33 14 47 38 71 15.4 10.7 8.4
$3-$4M 109 14 4 18 21 35 26.0 20.2 27.3
$4-$5M 63 4 4 8 9 13 35.0 31.5 15.8
$5-6.5M 71 9 1 10 5 14 71.0 33.0 71.0
$6.5-$10M 68 4 0 4 4 8 85.0 55.3 #DIV/0!
> $10M 47 1 0 1 2 3 117.5 101.8 #DIV/0!
                   
TOTAL 696 133 55 188 191 324 18.2 14.0 12.7

Last year at the end of May we had 574 home listing or 122 listing fewer. We also had 21 more contracts making for much more of a seller’s market. The increase in inventory is spread throughout the price ranges from lowest price houses all the way up to $10 million. The drop in contracts while not as dramatic as the increased inventory is also spread throughout the price ranges though not as evenly.

May 2016 vs  
May 2015- Inventory Contracts Mo. Solds Tot. Solds+ Contracts  YTD Solds  YTD+ Contracts Mos Supply Mos w/ Contracts Mo. Annlzd
< $600K 5 1 2 3 -4 -3 3.8 4.2 0.5
$600-$800K 9 -7 -1 -8 9 2 -2.3 2.4 16.5
$800K-$1M 0 3 -1 2 3 6 -2.4 -1.5 4.2
$1-$1.5M 32 -9 -2 -11 -1 -10 4.1 4.2 2.9
$1.5-$2M 18 -7 4 -3 -3 -10 3.6 2.9 -1.4
$2-$3M 1 13 5 18 0 13 0.1 -2.3 -4.5
$3-$4M 17 -7 1 -6 6 -1 -4.7 3.6 -3.4
$4-$5M 12 -9 1 -8 0 -9 6.7 16.4 -1.3
$5-7.5M -4 -1 -6 -7 -7 -8 39.8 10.8 60.3
$7.5-$10M 36 1 -2 -1 0 1 45.0 25.5
> $10M -4 1 -1 0 -1 0 32.5 -8.7
0 0 0 0 0 0 0.0 0.0 0.0
TOTAL 122 -21 0 -21 2 -19 3.0 3.1 2.2
Pro-Seller
Pro-Buyer

We do have two price ranges that are more pro-seller than they were last year. Sales from $800K – $1M are up from 11 to 14 sales and contracts are also 3 compared to May 2015. The segment that really stands out from last year is $2 – 3 million where contracts are up 13 over last year and we sold 5 more houses this year over last year.

 Inventory  Sales Inv. – Sales Diff
 Count                          696                          191                   505
 Total Sales $  $      424,232,044
 Average  $           4,382,986  $           2,221,110  $   2,161,876
 Median  $           3,192,500  $           1,775,000  $   1,417,500

Our median sales price is down a little due to weakness in the high end, which really stands out when you consider that our average listing price is $4.4 million.

graph-1

Our year to date sales are actually 2 houses more than last year due to an excellent February, which probably resulted in the poor March sales. April and May sales have been consistent with our historical sales average. What’s surprising is that much of our increased inventory is in only a couple of price ranges; $1 – 2 million and $5 – 10 million. (NB: In 2015 I used a price range of $5-7 million, but switched to $5- 6.5 million this year since it more evenly divides the $5-10 million segment so we do have more inventory this year.)

graph-2

Our sales are the same overall YTD compared to last year. We do see a couple of price ranges that are up or down, but it’s mostly just chatter. The increase in inventory has taken what is a normal sales year and made it more of buyer’s market as this same rate of sales is not absorbing inventory as fast as it is coming on.

The increase of inventory between $5 and $10 million really jumps out when you look at the months of supply. From $5 – 6.5 million we have about 6 years of supply and 7 years of supply from $6.5 to 10 million compared 2.5 year and 3.3 years of supply in 2015.

graph-3

On this scale it’s not as clear, but our months of supply from $1 – 1.5 million and from $1.5 – 2.0 million are both up about 4 months to 9.6 months and 13.2 months of supply. Both of these will be coming down as we have 40 contracts between $1 and 2 million waiting to close.

graph-4

When you look at the pie charts the $2 -3 sales and contracts really stand out while the high end sales and contracts are slow. Now we have seen this the last couple of years as Wall Street doesn’t give out the big cash bonuses the way they used to do. The third quarter is when high end sales are most likely to happen.

 graph-5  graph-6
May 2015 Sales May 2016 Sales

One thing that has changed from 2015 to 2016 is where the sales are happening. Old Greenwich and Riverside SoPo, south of the Post Road continue to do well. Cos Cob is where it is happening with lots of sales on the east side of town. The western border is also doing well as Glenville and the new and improved Glenville Elementary has gotten hot. Backcountry didn’t do well in May, but it has had 18 sales so far this year and another 13 contracts.

Right now we continue to see inventory come and the question is will sells accelerate above our average to catch up. It’s a good time to be a buyer.

 mpruner   Mark Pruner

Sales Executive

Douglas Elliman

88 Field Point Road Greenwich, CT 06830

203-969-7900 mark.pruner@elliman.com

http://GreenwichStreets.com

   

 

 

Mark Pruner is a sales executive with Douglas Elliman in Greenwich, CT. In 2015 he was the #1 DE agent in Connecticut. He writes the weekly real estate column for the Greenwich Sentinel.  He has been quoted in the WSJ, Forbes, Bloomberg TV and the NYT on Greenwich real estate. For questions about Greenwich please call him at 203-969-7900 or email him at mark.pruner@elliman.com.

 

A Realtor for Today’s Real Estate Market

I grew up in Greenwich and think it is a very special place. I treat my clients like family and make sure they get the perfect house for them and their family. For most people buying or selling a house in this special place will be one of the most important things they do. The process can be treacherous if you don’t have a Realtor with the skills and experience to make the process easier.

I practiced real estate law for many years and know the planning and zoning rules, the Inland Wetland regulations, the Zoning Board of Appeals process, setbacks, FARs, green area requirements, and the myriad of others issues that come up in today’s real estate market. I negotiated international asset-backed loans so helping clients with today’s bank financing complexities or more exotic forms of financing is just another deal for me. I also ran my own interactive marketing company and know how to market in the online world where over 90% of all real estate searches start today.

I attended Douglas Elliman’s Top Producers seminar in 2015 my first year at DE and write the real estate column for the Greenwich Sentinel. I serve on the Greenwich RTM (Vice Chair of the Education Committee); the Greenwich Land Trust (Acquisition Committee), the Greenwich Bar Association, and the Round Hill Association (President.). I frequently am contacted by reporters. I have appeared on Bloomberg TV and WCBS-AM and been quoted in the Greenwich Time, Wall Street Journal, New York Times, NY Post, ABCNews.com, Forbes and many other publications about Connecticut real estate. I have a B.A in Economics from Dartmouth College and a J.D. from SMU.