Guide to Organizing a House Hunt and Buying the House You Want

Buying a house can be one of the most fun things that you do in your life. How often do you get to go out and look at million and multimillion dollar properties and buy them. It outranks jewelry and cars by an order of magnitude in usefulness and price. Unfortunately, for some people it can also be one of the more tension-filled and miserable experiences of their life. Some people who start out happy end up miserable. This often happens if people don’t have a plan and start coming up against time barriers.

Figure out what it is that you need in your new place. Is it more bedrooms? Is it more space for her favorite hobby? Is it less hassle for maintenance? The next thing to do is to figure out what you like, what you like to do and what you’d like to have in your house so that you can do those things that you want to do. Do you like to have friends over and entertain? Do you like to go away for long weekends? Do you want to be able to hang out in the backyard without nosy neighbors?

If there are two or more of you, each of you can make a list of want’s and don’t wants and compare them. Often people will find a common denominator and things they hadn’t thought of. The next thing is to check with your Realtor and your mortgage company. Get an estimate of what you can afford and take a look at houses in that price range either in person or online to see if they meet your needs. If you are in a competitive market segment, then do more than get an estimate, pay the application fee and get pre-approved.

Bing.com’s birds eye view can help give you feel for the neighborhoods before you head out. When you do go out don’t so much look at houses as look at neighborhoods and see if those are the areas where you would like to live. This newspaper publishers a weekly open house list, and I, and a lot of other folks will send you a list of open houses for each week. So check out the open houses and get your agent to show you the houses that look interesting. You shouldn’t let all this be a straitjacket but you also shouldn’t be going from Byram to Banksville and from Old Greenwich to Quaker Ridge to find a house.

Once you get to a house ignore the furniture. Unless you have identical taste to this homeowner try to imagine what the house would look like furnished to your taste. One of my favorite examples of how not to do this was when I was out a public open house checking out some houses that I had gotten around to see. As I was walking down the upstairs hallway I heard a voice coming from the master bedroom that said, “Honey we could never live here this house has a blood-red bedroom!”. If you were planning on renovating anyway don’t be put off by small dark rooms. They can be opened up with a few extra windows, sliding glass doors and/or moving a walls. The one thing you should look at is ceiling height, because that can be easily changed.

If you like the house check out the basement. If it’s unfinished you can check for cracks in the foundation; minor vertical cracks are usually not a big issue while wide horizontal cracks may mean you should move on to a another house   Another thing to look for is efflorescence. When concrete gets wet some of the lime is leached to surface and leaves a fluffy mineral deposit.  Even if the basement is dry now, it’s worthwhile to find out why those lime deposits are 3 feet up the wall.

Even for a new house, you want to set aside some funds to get the house just the way you want. For an older house you can get a real bargain if you’re willing to do some work to fix it up to your taste. Lots of people are unwilling to take on a large renovation challenge, so if you are, you have a leg-up on the competition.

If you’re not finding what you want you should revisit that table you made of what it is that you’d like to see in the house and also consider some more financing options. In Greenwich, in particular, everything from artwork to stock portfolios, to rich relatives can be helpful in deciding how much you can spend.

Mark Pruner is part of The New Team at Berkshire Hathaway. He can be reached 203-969-7900 or mark@greenwichstreets.com

 

 

Backcountry Greenwich Market Analysis 1999 to August 2017

Backcountry Greenwich is recovering, though its recovery has been slower than southern Greenwich. In the recession year of 2009, we had only 27 sales down from the 84 sales five years previously in 2004. In  2009, we also saw the highest backcountry average sales price; $6,040,185 and a median price of $4,500,000.

BackCountry Median Sales Price and S.F.

From 2004 to 2009 sales and price diverged with sales falling nearly every year while the average price also went up every year. Falling sales and rising prices are the classic signs of bubble, but then hind sight is always 20:20.

Backcountry Greenwich House Size and Median Price

So, what’s been happening since the depths of the Great Recession. From 2009 to 2015 we saw a jagged increase of sales to a peak of 61 sales in 2015. In 2016, sales dropped back to 49 sales and through August of 2017 we have seen 25 sales in backcountry Greenwich.

BackCountry Volume & Sales Nos.

Now only 25 sales might make you think that 2017 will be another down year for sales, but high-end sales are now skewed to later in the year, so it’s not over till it’s over and the last house sale gets counted early next year. This high-end shift to later in the year is epitomized by the three properties listed for over $20 million that have either sold or gone to contract in the last 30 days including one in backcountry.

As of 9/2/17 Inventory Contracts Last Mo. Solds Tot. Solds+ Contracts  YTD Solds  YTD+ Contracts Mos Supply Mos w/ Contracts
< $600K 0 0 0 0 0 0
$600-$800K 0 0 0 0 0 0
$800K-$1M 1 1 0 1 0 1 9.5
$1-$1.5M 6 0 0 0 6 6 8.0 9.5
$1.5-$2M 12 0 1 1 4 4 24.0 28.5
$2-$3M 15 1 1 2 7 8 17.1 17.8
$3-$4M 12 1 0 1 4 5 24.0 22.8
$4-$5M 11 0 1 1 2 2 44.0 52.3
$5-6.5M 12 1 0 1 0 1 114.0
$6.5-$10M 15 2 0 2 2 4 60.0 35.6
> $10M 11 0 0 0 1 1 88.0 104.5
TOTAL 95 6 3 9 26 32 29.2 28.2

What we have seen in 2016 and 2017 is an increase in the average size of backcountry houses that have sold. In 2015, we had the smallest average size or 4,861 s.f., which would be a large house in most of the U.S. So far in 2015 the average size house had increased to 6,020 s.f.  This is a nice house, but in the peak year of 2009, the average size of a house in Greenwich hit an all-time high of 8,289 s.f. Those days of big, for big sakes, mansions are not likely to return anytime soon.

You do have to be careful when dealing with averages in a changing market. Much of what drives these changes in the average house size is not that houses are getting smaller.  (We haven’t seen people lopping wings off their 8,000 s.f. houses to make them more saleable.) What we are seeing is that the mix of the houses that are selling were tending to smaller houses and that mix has started to get bigger as town-wide the high-end is having its best post-recession year.

Also, as you would expect if the average size of houses being sold is increasing then so is the price of those houses and that is what we are seeing. In 2015, the median price of a house sold in the backcountry was down to $2,043,000 while the average was $800,000 more or $2,834,464 as the high-end sales pulled up the average. The high-end didn’t pull up the average as much as it could have in 2015 as that was our first year since 1990’s without a single, backcountry sale over $10,000,000.

The median sales price in the backcountry was up to $2,200,000 in 2016 and is at $2,495,000 so far this year or an increase of 22% in just two years. Now this doesn’t mean that your house is up 22% if you live in backcountry, but it does mean that we are seeing more high-end sales that are pulling up both the average and the median.

Backcountry Inventory, Sales YTD, August Sales and Contracts

Backcountry is also sharing in some of the 2017/best year for sales over $5 million since the Great Recession ended, e.g. the over $20 million September contract mentioned before. However, we still have some seller expectations to be reset to the 2017 reality. Many of our younger, family buyers want to live closer to town. Peter. What used to be highly desirable in a property; more acreage and privacy is not as highly desired by many in this group. Having said that you don’t need a lot of buyer to change backcountry sales, an increase of 20 sales would easily do it.

BackCountry Greenwich Months of Supply August 2017

In addition, for sales from $1 – 4 million demand for backcountry homes is about the same as in other parts of town. We are not seeing the same demand for the price range from $5 – 6.5 million. In the rest of town, we around 20 months of supply in backcountry we have yet to have sale out of 12 listings.

On the good news side, we are seeing more interest in the backcountry as a place for weekenders who used to roughly account for about a third of backcountry sales. Some weekenders are getting tired of the long schlep out to the Hamptons. A resurgent Armonk has also helped backcountry sales. What used to be a quiet little time with little nightlife has seen a resurgence of good restaurants; such as Fortina, Zero Otto Nove, Mariachi Mexico, Koku, Nick’s Pizza, while DeCiccio’s Market has become a Saturday destination for my wife.

Once we get the budget settled in Hartford and the fear of uncertainty goes away, 2017 might turn out to be a nice year for backcountry.

 

Mark Pruner is a Realtor with Berkshire Hathaway. He can be reached at mark@bhhsne.com and 203-969-7900.

August 2017 – Greenwich Real Estate Market Report

** High End Market Looking Up – Even Way Up **

Our high-end market is back from the dead, though I’d say that at worst it was only seriously ill. For all price categories over $5 million, sales are up and inventory is down, and in many cases months of supply is way down. The best indication of this is 460 North St. which just reported a sold price of $22 million. The curious thing is it was listed for 379 days on the market at $20 million. Regardless, it’s quite a sale and speaks to the perking up of the high-end market.

Inventory Contracts Last Mo. Solds Tot. Solds+ Contracts  YTD Solds  YTD+ Contracts Mos Supply Mos w/ Contracts Last Mo. Annlzd
< $600K 1 2 0 2 11 13 0.7 0.7
$600-$800K 15 4 3 7 34 38 3.5 3.8 5.0
$800K-$1M 17 4 3 7 32 36 4.3 4.5 5.7
$1-$1.5M 68 11 12 23 87 98 6.3 6.6 5.7
$1.5-$2M 75 11 10 21 62 73 9.7 9.8 7.5
$2-$3M 125 11 11 22 73 84 13.7 14.1 11.4
$3-$4M 76 6 7 13 44 50 13.8 14.4 10.9
$4-$5M 47 5 2 7 19 24 19.8 18.6 23.5
$5-6.5M 55 4 3 7 22 26 20.0 20.1 18.3
$6.5-$10M 47 7 4 11 12 19 31.3 23.5 11.8
> $10M 37 3 1 4 3 6 98.7 58.6 37.0
TOTAL 563 68 56 124 399 467 11.3 11.5 10.1

Above $5 million total sales and contract through August are up 20 to 51 houses wanted by buyers. At the same time, the sellers have pulled back and inventory is down in the high-end price category by 36 houses to 139 listings. Now all of that is good news but not great news.

Over $10 million we only have 6 sales and contracts out of a total 37 listings which equates to 59 months of supply or almost 5 years. While 5 years of supply is still very much of a buyer’s market, it compares to over 12 years of supply at the end of August 2016. This dramatic drop of 93 months of supply from last year to this year is due to inventory falling 11 listings and sales and contracts increasing only 3 houses. When you have a very poor market, a few sales can dramatically reduce the months of supply, but it’s still only a handful of sales. Still the high-end market is seeing more sales. Part of this is sellers are taking significant haircuts on prices, but that’s what makes for a better market; buyers and sellers finally agreeing on the value of a property.

Greenwich R.E. Months of Supply Aug. 2017

To see the part of the high-end price range that is doing the best look at the $5 to 6.5 million price range. There we only have 20 months of supply which is a down from 44 months of supply last year. Sales and contracts are up 12 and inventory is down 12 making for this dramatic drop. In this price range, we have 57 house houses on the market and 26 sales and contracts so far this year. This compares to only 14 sales and contracts at the end of August last year. We are seeing almost twice as much activity in this price range.

Another price range that has become so competitive that has almost disappeared is our inventory of single-family homes under $600,000. We only have 1 house in inventory and we’ve sold 11 this year; the same as last year’s sales.  They go off the market as fast as they come on. This equates to three weeks of supply. Last year we had 3 1/2 months of supply.

Greenwich Real Estate Sales 2015 - Aug 2017 w/ 10 year average

In between $600,000 and $3 million the situation is muddled, particularly from $1,000,000 to $3,000,000. In this price range inventory is up 41 listings from last year while sales are down 22 from 2016. This is the heart of our market where we have 268 listings out of a total of 563 listings. We also have 255 sales and contracts, curiously this is down by 38 sales and contracts from last year. If anyone knows the reason why the middle market is down somewhat, while the high-end is looking much better I’d love to know what it is.

’17 vs ’16 Inventory Contracts Mo. Solds Tot. Solds+ Contracts  YTD Solds  YTD+ Contracts Mos Supply Mos w/ Contracts Mo. Annlzd
< $600K -4 0 0 0 0 0 -2.91 -2.92
$600-$800K -4 -8 -4 -12 3 -5 -1.37 -0.45 2.29
$800K-$1M -5 -4 -1 -5 0 -4 -1.25 -0.74 0.17
$1-$1.5M 10 -3 -6 -9 4 1 0.66 0.91 2.44
$1.5-$2M 15 -9 -4 -13 -19 -28 3.75 4.12 3.21
$2-$3M 16 -4 -2 -6 -7 -11 2.80 3.24 2.98
$3-$4M -11 0 1 1 5 5 -4.03 -3.93 -3.64
$4-$5M -11 1 -1 0 -2 -1 -2.31 -3.44 4.17
$5-6.5M -12 2 3 5 10 12 -24.67 -25.37
$6.5-$10M -13 2 4 6 3 5 -22.00 -17.21
> $10M -11 3 1 4 0 3 -29.33 -93.42
 
TOTAL -30 -20 -9 -29 -3 -23 -0.51 -0.04 0.93
% change -5.3% -29.4% -16.1% -23.4% -0.8% -4.9% -4.5% -0.4% 9.3%
Pro-Seller Pro-Buyer

The end result of all of these changes in sales and contracts in different price ranges is that inventory is down 5% from last year and sales are down a minuscule 0.8%. You could say that overall 2017 is about the same as 2016. The disappointing thing at the moment is that our contracts are down 29% from this time last year from 80 contracts to 68 contracts, which tends to indicate that September will also underperform the average.

So, what does this all mean? It all depends on who you are. If you are a seller in the mid-range from $1.5 to $3 million you’re going to find the market a little tougher than last year. However, if you have a new house in Riverside under $3 million, of which there are vanishingly few, you will still do well if you price it right.

And, that’s where our market is today at every price range. Buyers will buy if they think the house is a good value. It doesn’t have to be a bargain, it just has to appear to the buyer to be a fair price. As prices have adjusted to what buyer’s think is FMV at the high end, folks are buying. Maybe that’s what’s happening in the middle. Sellers have seen lots of demand the last few years and may be starting out and then holding out for a price that is more than the buyer’s price.

As a result, the fall market promises to be interesting. We had 57 new listings coming on the market in just the last week and my buyers are asking about all this new property, so this should be a busy open house weekend. If you are out this weekend, I have a nice 3,800 s.f. house with a pool on 6 acres in the backcountry for $1.69 million that’s having an open house from 1 – 4 pm on Sunday. Stop by and let’s talk about the market.