So far this year we have had 483 sales on the Greenwich MLS and 68 of those houses sold for original list price or higher. We also had 58 houses go to binding contract in 30 days or less. Now as you might expect a lot of those houses that sold in less than 30 days also sold for list price or higher so you can’t just add the two numbers together. Once you dedupe the combined list you come up with 91 single family homes that either went to a binding contract in 30 or less or sold for list price or more this year. This is 19% of all our sales would be described as quick sales in a “hot” market and the market is actually better than that.
To see why the market is hotter than that you need to look at each side of the hot market. The 68 sales at or above original list price are fairly straight forward. Did the property sell for what it was originally listed for or more? This means that the property was originally put on for what one or more buyers thought was fair market value.
If you have a competitive market in your area of town and price range, putting your property on for what you think is FMV is often the best way to get more than fair market value. Highly competitive buyers don’t want to lose and bid up a house to above what any of them might had paid if there wasn’t competition. Of the 68 houses that have been sold so far in 2016 for list or above, 13 of the houses sold for 105% or more of list price.
What is left out of these over-list sales are those sales where the price was subsequently lowered to fair market value and the sale then went for that price or more. There are 11 properties where once the house price was lowered to market value it went for list or over list price. The amazing thing about these 11 properties is that their median time on market was 9 months. While only these 11 went for list or above, as agents, we frequently see houses that sit with little showing activity even after a price reduction. Then when the price is reduced to what the buyers, who often have only seen pictures of the house on the internet, think is enough there is a flurry of activity and often a quickly accepted offer.
Add in these 11 houses that got reduced to FMV and you now have 102 hot sales, but we are still leaving out a very large group of hot houses.
Calculating just how many houses went to contract in 30 days or less is more complicated. We have 58 houses that went to binding contract in 30 days or less, but that number is deceptive as to just how hot the market is. The GMLS counts houses that are under a contingent contract as still active so the days on market continue to accumulate even though for other buyers these houses are effectively off the market.
The majority of our sales contracts have a mortgage contingency. None of these contingent contracts are included in the 102 houses. (There is one small exception for contingent contracts that become binding in less than 30 days; e.g., where the buyer is pre-approved and only has to have an appraisal.) Without going through each sales history by hand you can’t tell which contracts went to contingent contract in less than 30 days, but a conservative guess would be at least another 30 contracts so now you are up to 132 hot houses in Greenwich or 27.3% of our sales.
The other thing about houses going to contract in less than 30 days is that they probably had an accepted offer a week or 10 days before, so these houses were really unencumbered for only three weeks or so. As you might expect for houses that went to pending contract in less than 30 days the majority or the majority also went for list or over list.
On the condo side the market is also competitive. Of the 148 sales of condos and co-ops that we have had this year 36, or 24% went for list or over or in less than 30 days.
Now you might think that it is only the lower end of the market where we see this kind of competitive market, but 30 of these sales were for more than $2M. These houses were spread throughout the areas of town where our more expensive properties are; Old Greenwich and Riverside south of the Metro-North tracks, shorefront, but also in in mid-country or backcountry. A good house, at a good price will sell anywhere in town.
For the under $1.3M market the hot areas are the R-7 zones in Old Greenwich and Riverside and all of Cos Cob. We do have a few hot sales in Glenville, but we are not seeing the competitive buying as much in Byram and Pemberwick.
What’s hot is price and condition. Over pricing a house, by even 10% can delay the sale and result in a lower price. An unhurried buyer makes lower offers. The other factor in the hot houses are fairly recent renovations with the majority having been renovated in the last 10 years.
If you are on the buy side and if you see a house that you like don’t wait to go see. It may be under contract next week.