We have a lot of great houses in Greenwich that sell at premium prices, but these houses, particularly, the older ones, were not built the way you see them today. Their owners moved with the times and renovated these houses to include the features that they and other people want. Today we are going to look at 22 Cherry Tree to see some of the things that were done to make a good house great.
Location, Location, Location
First off, the house at 22 Cherry Tree Lane has location (Riverside), location (Harbor Point Association) and location (great views of Long Island Sound). For many folks in Greenwich, and even in Riverside, these streets may not be known, as unless you are going there, you aren’t going through there as the streets on the southern end of Riverside all end at the Sound.
The Harbor Point Association was at one time a great estate of some 40 acres and now hosts some 35 houses. The association fronts on Greenwich Cove and the Sound and comes with its own marina and beach along a breakwater that reaches out into the Sound. It also has one of the nicer security guards at the front gate and many of the houses overlook a tidal pond with a weir at the opening that keeps the pond full at low tide.
A Hot Neighborhood Today
The present owners bought the house back in 2013 and it was a good house with 5 bedrooms and 4/2 baths on 1.05 acres with beautiful views of the Sound and tidal pond. (On the other side of the pond is 34 Indian Point Lane that sold in June of this year for $42,175,000 and also 32 Indian Point Lane which is listed at $20,995,000, but it’s too late if you wanted to buy it as it is under contract.) In 2013, 22 Cherry Tree was a two-story house with a portico across the front and seven gables on the second floor. It had been listed originally in 2011 for $6.99M. The following year it came back on at $5.49M and towards the end of 2012 was relisted for $5.19M and sold for an even $5 million on July 8, 2013.
Finding Ways to Improve a Good House – The Pool
The question for the buyers was how to take a good, solidly built house and make it better. The new owners and the architects came up with several ways to improve the house. The most obvious change was the addition of a large pool right out the back door. The owners were originally told this could not be done, but with some creativity, perseverance and $400,000; the pool got built.
While the pool is beautiful much of that cost was not paid to Shoreline Pools to actually build the pool. The lot is 1.05 acres and this area is not served by town sewers, so each lot needs a septic system. In the case of 22 Cherry Tree Lane, the septic system was located right where the pool would go. So. Redniss & Mead had to come up with an engineering solution. The whole septic system was moved from the large yard on the side of the property to the rear of the property, which meant you needed engineering studies and the approval of the Town Health Department. The nice thing is that moving the septic system meant that area is now a level yard ideally suited for the present badminton court or other outdoor activities.
This area of Riverside falls within the Coastal Area Management Zone so it gets extra scrutiny from the town Planning and Zoning Commission. The regulatory process for all town agencies took two years to complete and cost a substantial portion of the $400K spent on the pool. Another major cost was that owners wanted the pool to be a roughly the same level as the first floor of the house to get better views of the water and sunsets. This required bringing in dozens of truckloads of dirt. At the end of the day the owners had a beautiful pool, an amenity that is in great demand in the Covid era.
Adding interior space and improvements
The owners also wanted several additional features including a large walk-in closet in the master bedroom, a screened in porch, an elevated place to sit and watch the gorgeous sunsets and more space. They also wanted an updated kitchen, a second floor laundry and more parking spaces. The walk-in closet had an easy solution that was hard to do. Right next to the master bedroom was a small bedroom that didn’t work well as a bedroom but made for a very nice walk-in closet and an upstairs laundry room.
The hard part was figuring out how to replace that bedroom as you don’t see many four bedroom houses at this price point. The solution was to add a third floor but zoning only allows for 2 and a half stories and a maximum height of 40 feet. A half story does not mean that ceiling is only 4 feet high on the third floor, it means that the size of the floor can only be half the square footage of the floor below. The height requirement would also have been violated with a standard peaked roof, so the third floor had a roof with two peaks each lower than a full peaked roof.
The setbacks in the RA-1 zone are 50 feet for the front and backyards and 25 feet on the side, so how to add floor space without significantly expanding the overall footprint of the house. One way to do this was to use the “wasted” upper space for the cathedral ceiling in the living room. By putting a ceiling over this space, the owners got a playroom on the second floor. Directly off of the living room they screened in part of the portico and put a roof deck on top, which became one of the great features of the house. Now you can sit and watch the water from an upstairs vantage point.
At the same time, they enlarged the windows on the second floor to let in more light and make the views of the Sound ever better. One area where many homeowners have particular requirements is the kitchen. Today’s kitchens are just as much gathering areas as are the adjacent family areas. The owners hired Kitchens by Deane to give the kitchen a warm inviting feel, while still being very functional. They also opened the kitchen to the family room and redid the large center island.
Much of this work was done before the family moved in, though the long approval process for the pool meant that that work was going on while the owners were there. These changes and improvements in total came to $4 million over and above the purchase price, but in the end the owners got a house that felt like new and had everything that they wanted.
As I often tell buyers, very few people ever regret creating the house that they really want. The costs to create a great house are not insignificant, but why put up with house features that make you unhappy every day. Your home should be the castle that you want.
Even in one of our hottest market ever 13% of our 491 listings have been on for more than a year. Of those 64 old listings that have had their birthday anniversary, 18 of them have actually had their second birthday and 5 of them have actually been on for more than 1,000 days, so what keeps houses from selling.
INITIAL PRICING: The biggest reason by far is over-pricing the house when first listed. The first two weeks of a listing is critical and if online buyers think the house is overpriced they won’t even go see the house. Even if their agent recommends seeing the house if what they see online doesn’t match up with their idea of its value they will turn down the showing.
So why do owners over-price their houses? First, it’s just human nature; no one wants to leave money on the table if a buyer would have paid more, so why not take a flyer at a higher initial price. This hope and a dream approach can set off a cascading list of issues that can easily leave the house on the market for a year or more and result in price well below what you might have gotten.
Second, owner’s value the unique features in their houses that were added as labors of love and money. The problem is that most buyers will only pay a little more, if any for these features. Paradoxically, the lowest list price often leads to the highest and fastest sales price, by generating the most traffic to the house.
Things like quality of construction, beautiful gardens, and homeowner care and maintenance often don’t play into a buyer’s decision as whether to see a house or not. With the rise of the Internet, items that can be rendered as numbers have reduced the unquantifiable elements. Buyers look at square footage, price per square foot, acres, days on market and other features that they can sort on their spreadsheets as signs of value.
PRICE REDUCTIONS: Every time, an owner changes the price it shows up on the Internet and each price change or lack of them have an unwritten tag line in buyers’ mind:
Price unchanged for 100 days – The seller won’t negotiate a “fair price” and may not want to sell at all, probably a waste of time to go see
A small price reduction – Seller will negotiate, but their bottom line is close to their present list price so that needs to be close to the buyer’s perceived value
A series of small price reductions – Must be something wrong with the house if no one has bought it after all those price reductions and the buyer is probably desperate and will take a lowball bid.
If the buyer traffic is not there initially, or if you had good traffic, but no offers have been made it’s time to take a major price reduction. You also don’t want to do this more than twice so the bigger the better. Once again paradoxically the bigger the price cut the better your sales price will be. What you don’t want to get caught in is the death spiral of a dozen cuts, if you do you may end up having to reduce the price below “fair market value” to get people to come see your house.
POOR PRESENTATION: I was talking to another experienced agent about how much clutter and poor presentation could cost a seller and we both came to the same figure. We posited two identical older homes, but one was neat and tidy and the other cluttered and dirty. If the neat house went for $750,000 we both estimated, it would be minus $50,000 if the other house was a mess. If you add dishes in the sink and mildew in the shower, you could take off another $25,000. Appearance counts.
So, the things you can do that will improve the value of your house starting at street side:
Curb appeal – A lot of people decide whether they like a property as soon as they see it, so trim the trees and bushes, remove fallen branches, fix the driveway, paint the mailbox and add big house numbers so the house is easy to find. Make sure the path from the driveway to the front door is a nice as you can make it; buy a new doormat with a welcoming message, paint the front door and replace any corroded door knobs and knockers.
First steps – Assuming they still like the house from the exterior the next most important is the first two steps inside. Make the inside air temperature the opposite of the outside; warm in the winter and cool in the summer. Make sure there are no unpleasant smells such as cat pee or cigars (we smell one of these every week.) The entry should have the warm inviting feel of a home not a hotel lobby.
Inside – Get rid of “bad memory points,” the things that people remember a week later about the house. I’ve seen dead squirrels in the attic, dead bugs under the sink, and used diapers left out. Even things that aren’t offensive should be fixed, like door that stick, dust on shelves and a used drinking glass in the sink should be removed.
NEGOTIATION: If you want to really insult a Greenwich seller make a lowball offer, however, if you are the seller put that irritation aside and consider the situation. Last year our median sales price to list price was 92% so if the parties were to meet in the middle the buyer would start with an offer of 84% of list price or an $840,000 offer on a $1,000,000 listing. A lot of sellers wouldn’t even counter this “insulting” offer and a lot buyers would be too embarrassed or prideful to raise their own opening offer so the negotiation is over, before it began.
My philosophy is to counter every offer. The buyer maybe an ignorant, irritating, cheapskate without any money, but you’ll never know unless you counter-offer (along with a strong, and often unneeded, admonition from seller’s agent to buyer’s agent to get serious in buyer’s counteroffer.)
The other major negotiation killer is the line in the sand. Very often the buyer and seller will be less than 1% apart, but they both draw a line in the sand and won’t make a better counter. (Seller: If it’s that small a difference the buyer shouldn’t have problem coming up 1%.”) If that happens try to add more negotiating options; a better closing date, larger down payment, or offer to include the yard furniture, or the Mercedes.
And, whatever you do, try not to tick-off the buyer. It never makes the process easier and greatly increases the chance that both parties will walk. At the same time try not to be ticked-off yourself. Yes some buyers are rude, but it’s a transaction not dating. Too often, what is perceived as rude is really a cultural, regional or national difference in style, so stay cool and a few showings, can lead to a good price and quick close.
Sales are up in Greenwich, but not in every neighborhood. Overall sales, as of the end of August, are up from 359 sales last year to 461 sales this year an increase of 102 sales or 28%. What’s up even more are contracts which are up from 83 contracts as of the end of August 2019 to 193 contracts this year or an increase of 133%. When you total up all of these sales, we went from a total sales volume of $877,661,399 last year to $1,180,418,928. This is $303 million increase in sales is 34.5%, which means that the town conveyance taxes are up nicely this year. At the same time, our inventory is down 14% and this week we actually dipped below 500 listings. So, it is a tight market overall.
As of 9/2/2020
Sum of Sold Price
Average of Cumulative DOM
Average of Sold Price
Average of List Price/SqFt
Average of Sold Price/SqFt
Average of SP/ASMT
Average of SP/OLP
So. of Post Road
These are the headline numbers, but the market gets much more nuanced when you look neighborhood by neighborhood. We have four neighborhoods that are up and three neighborhoods that are down, but even there some stats are up and some stats are down. The Covid buyers are definitely looking for land and as you might expect backcountry and mid-country are the big beneficiaries of this desire for more space and larger houses.
In backcountry sales are up 52 percent to 50 solds compared to only 33 last year. Our average sold price is actually down 22% from $3.13 million last year to $2.46 million this year. Now for my backcountry neighbors there is no need to worry about what some wag, somewhere, will call a collapse in prices. What we are seeing is just a major pickup in sales below $3 million. Anything that comes on the market in backcountry under $2 million gets snapped up quickly. Our average sales price/sf is down 4.3%, which also is due to the number of sales under the median of $2.46 million. While our inventory is down 14%, this is not a time to be asking for a premium price as discussed below. Priced correctly, houses in backcountry sell and under $3 million they sell pretty quickly.
South of the Parkway
Our second biggest increase in sales is South of the Parkway, an area that covers central Greenwich from the Merritt Parkway to the Post Road. There sales are up 47.4% with total volume up 53% to $451 million. Inventory is down 16%, days on market are down 11% and the average sales price to original list price is up 3.9%. All are signs of a stronger market. Even here though, you can see how the pandemic has shaped the market. Our average sold price is up 3.8% and our average sold price/sf is actually down 4.3%.
The average sales price is up, because we are seeing more high-end sales this year, which is bringing the neighborhood average up. The average sales price/sf and the sales price to assessment ratio are down, showing that we have some motivated sellers. Also, these averages cover the whole year and clearly lots of sellers were looking to sell in April and May at last year’s prices. We are seeing more recent sales prices at higher values and ratios, but not by a huge amount.
Aug 2020 vs. Aug 2019
Sum of Sold Price
Average of CDOM
Average of Sold Price
Average of List Price/SqFt
Average of Sold Price/SqFt
Average of SP/ASMT
Average of SP/OLP
South of Post Road
Cos Cob & Glenville
Cos Cob has had a good year, sales are up 40% over last year. Now part of that is because last year was not a good year for Cos Cob. In fact, Cos Cob had our biggest percentage drop in sales last year. This year Cos Cob is back; sales are up, the average sold price is up and the average sold price/sf is also up a little. Cos Cob has had 42 sales this year and has another 21 contracts waiting to close, so sales should continue to look good in September.
The past few years Cos Cob and Glenville have moved together, as alternatives to pricey Old Greenwich and Riverside. Like Cos Cob, Glenville also had a poor 2019 and this year it has recovered somewhat with 20 sales compared to last years 17 sales. One of the issues for doing statistics on Glenville is that people like the area so much they move in and stay and it’s a smaller area. So, a couple sales up or down can make a significant percentage change. Right now, we only have 18 listings in Glenville compared to 44 listings for Cos Cob,
Riverside & Old Greenwich
Riverside has returned to being a very preferred neighborhood after not being so favored last year. Sales there are up 35.6% compared to only 21.0% in Old Greenwich. This difference is due to the poor sales last year in Riverside. Between the two neighborhoods we have total sales of 155 houses or a third of all of our sales. When you look at a map, you see a lot of sales and contracts in an area that is a small fraction of Greenwich’s total land area.
Also indicative of Riverside’s rebound this year is the average sales price is up by $471,481 this year in Riverside, while the average sales price in Old Greenwich is actually down despite increased sales. Once again much of this is an adjustment in what prices are selling, rather than an overall change in prices. If you really want to make Riverside look good, we can include the private $42 million sale on Indian Point Lane earlier this year. If we do that, the average sale in Riverside goes up by over $500,000. In fact, that one sale would have brought up the townwide average sale by $91,000.
South of the Post Road, Byram and Pemberwick
Sales are down a little bit in the southwest part of town. Now while South of the Post Road includes Belle Haven, it also includes Chickahominy, which moves much more like Byram and Pemberwick. In these areas we have a lot of R-6 zones. The R-6 zone is a two family zone with a minimum lot size of 0.17 acres. In the Covid era, 2 families on a sixth of an acre is just a little too cozy for some.
The other issue for these neighborhoods where the median R-6 house sold for $655,000 is that they are seeing lots of competition from Westchester County, as well as Stamford, Norwalk and further up the line. The Covid buyer is hoping to only commute a couple of days a week so the longer commute from Norwalk, Wilton or Fairfield is less of a factor in 2020 than when employees had to be at there desks in the City every day.
Covid has turned our market on its feet. I say this because, the Great Recession turned our market on its head and now Covid is putting us back on our feet. Buyers from NYC are looking for more land, more square footage and more in-home amenities, which says 2 and 4 acre zoning in mid-country and backcountry. The second office and the pool are becoming bigger wants. At the same time, mid-size zones in Cos Cob, Riverside, and Old Greenwich are doing better than last year.
Our two family, R-6 zone is not doing as well with buyers even at the lower price ranges. In the Covid era, buyers are willing to pay higher taxes in Westchester or are willing commute further into Fairfield County for more space. We also have a fair number of Greenwich residents who are looking to upsize. Many of these folks were waiting to move and now that the market is so much more competitive and interest rates are at record lows, they are pulling the trigger.
As to where we are going, we have lots of contracts so September and even October should be good months. I’ve also met several buyers who had rented here for the summer and are now going to buy something in the near future. If you have a house to sell, now is a very good time to do it as who knows what will happen next year.
If you do put your house on the market, your Realtor needs to do a thorough analysis of the micro-market for your house. Some areas, styles, recent construction and amenities would support a higher price in this market, but you still need to be competitive. Every week, we see nice houses whose listings are expiring unsold.
On the buyer’s side, it’s also a good time to be in the market. Interest rates are down, and prices are not up significantly, however, we are seeing slightly higher prices in the sales starting in August. While the seller’s need to worry about recession/price drop, there is a better chance than we will see higher prices next year, so there is a good opportunity for buyers. Waiting may not be in your interest.
ERRATA: Last week’s article mentioned that this August was our best August ever with 108 sales reported on the GMLS. As my brother, and long-time Realtor, Russ Pruner pointed out we actually had 109 GMLS sales in August 2001. He is the keeper of stats that go back well into the last century and has a website with lots of good interactive stats in the “Market Data” section of his website at http://www.russellpruner.com. His data also shows that in the last 40 years we have had a couple of years where August was the highest sales month, just not this century. I apologize for slightly over-stating just how good August 2020. As Bum Phillips said about Herschel Walker, “He may not be in a class by himself, but it doesn’t take long to call roll in that class.” That’s what this August was like.
Sales Contracts are Up 133% at the beginning of September
August single family home sales were literally off the chart, at least my chart. We had 108 sales which meant I had to rescale my graph of monthly sales; it normally only goes to 100 sales. Post-recession, we have never had an August like this. We also have never had a post-recession year where the high point for sales was in August; it’s normally June or July. Covid has not only increased sales, but time shifted them, by two months or possibly more.
Starting in the 3rd week of June, we have seen weekly transaction, contracts and sales) in a trading range as the stockbrokers call it, that varies from 47 transactions to 68 transactions per week. The lower transactions weeks are primarily due to a 4-day holiday week or a tropical storm. Overall, we have been averaging about 60 transactions a week. In the most recent week we had 63 transactions. For the last 4 weeks, we have averaged 64.3 transactions per week.
September sales & contract
As a result September has a decent chance of beating August’s outstanding sales. We can be fairly sure that September sales will be the highest for any September since September 1990, but they may not beat August 2020’s 108 sales. We have 193 contracts up from 83 last year, however, that number is down 15 contracts from the 208 contracts that we had the beginning of August. We do have a late school start this year, so we will continue to see families in September pressing to get in before the beginning of school.
Inventory stays down, despite lots of new listings
On the inventory side we, only have 505 listings, down 14% from last year. So, with increased sales and lower inventory, we are seeing big drops in months of supply. For the market overall, we have 8.8 months of supply dramatically down from 13.0 months of supply at this time last year. The really dramatic number, however, is when you take August sales and annualize them, there you go from 9.3 months of supply for last August’s annualized sales to 4.7 months of supply August 2020. You just don’t see that kind of low number in a town, like Greenwich, where the median sales price is now $2,040,000. High-end houses take a while to sell and this results in higher months of supply, well at least did.
As of 9/1/2020
Last Mo. Solds
Last Mo Solds+ Contracts
Mos w/ Contracts
Last Mo. Annlzd
Prices trending up
Our median sales price in 2019 was $1,866,666 as of the end of August our median sales number is the aforesaid, $2,040,000 or an increase of 9.3%. Now as usually happens, most of this apparent increase in appreciation is due to a major increase in sales above our $2 million median, not an overall increase in prices across the town. As more house sell above our old median price, the median gets pulled up. But we may finally be seeing real appreciation as more of these houses that went contract after multiple bids close.
When you look at the sales price price/sf, that number is up 4.5% from $503/sf last year to $526/sf this year. The other key indicator is the sales price to assessment ratio and that is up only .73% over last year, but even there we are looking at real appreciation. Another key indicator does show actual appreciation. When you look at the August sales price to the original list price ratio (SP/OLP) we see a lot more hot sales. Of the 108 sales in August 2020, 44% of them were for full list or over list price. This compares to August 2019 when only 8% out of 63 sales sold at list or over list.
Sales under $1 million
When you look at the price ranges our inventory under $1 million is supply constrained with only 34 listings compared to 47 last year. Sales are the same as last year. One reason may be that these houses are on smaller lots, so these buyers may be buying large lots further upstate Connecticut and in Taxchester, New York.
Sales from $1 – 4 million
The standout part of the market is from $1 – 4 million where we have 339 of our 461 sales so far this year. This is up 121 sales from last year. We also have 138 of our 193 contracts between $1 and $4 million. This our family market.
The remarkable thing is that last one million price range from $3 – 4 million. This is traditionally an older buyer with high school or college kids or empty nesters looking for the large house that marks a lifetime of hard work and success. This year it includes successful families with toddlers and young children that might have otherwise stayed in the city.
Sales over $4 million
Even over $4 million we are seeing more young families. Patty Ekvall and I have had a bunch of showings at 22 Cherry Tree Lane in Harbor Point in the Little Belle Haven Section of Riverside. This house is on for $7.25 million and with one exception, the buyers have all been families with elementary school or younger children. Two of the buyers have had houses in the Hamptons who now want a high-end house that is a commutable distance from NYC.
If you are interested in percentage change rather than absolute number changes the high-end is the place to look. Our contracts from $6.5 – 10 million are up 350% from last year. Last year we had 2 contracts in that price range, this year we have 9 contracts. For the whole market over $5 million we are up 24 sales and contracts to 58 transactions this year.
The high-end market was slow to get started, but really started to heat up in the middle of June and has only continued to get busier. To see that just look at transactions over $5 million in the last three days from 8/31 to 9/2. We’ve had 4 sales over $5M including 75 Byram Shore Road at $12,000,000 after it had been on the market for 971 days.
The really remarkable deals are the 4 listings in contract in that 3-day period. The Helmsley place finally went to contract after 1,540 days on market. On the shorefront, 32 Indian Point Lane is under contract and is listed at $21,000,000. Over in Belle Haven, 66 Glenwood Drive listed for $13,750,000 has a contract after being on and off the market since April 2018.
Some Do’s and Don’t
Some sellers are seeing all this activity and are reaching for the golden ring on their listing price. Despite all this activity, that is probably not your best strategy. Any busy broker can tell you of houses that are overpriced and just aren’t getting showings. The idea that in a hot market people will come see houses that they think are overpriced is just wrong.
In most price ranges you are not competing against other Greenwich houses, but potentially two counties worth of similar listing. Traditionally, a Greenwich buyer was a Greenwich buyer. A Covid buyer just wants out and the particular town is not as crucial. Even if the market is tight here, buyers that think your house is priced to high are often looking Scarsdale or Bedford or New Canaan or Westport.
For buyers, be prepared and be prepared to move fast. You can check out my article in the Greenwich Sentinel from a couple of weeks ago about how to be the winning bidder in a hot market. Set up a meeting with your mortgage banker and your attorney, either in person or virtually. They need to know who you are before you need them. Also get the contact info for an inspector or two in case the first one is busy. You want to be able to get to contract before your competition. Even being a day faster can mean you get the house. I have had two buyers contact me after they lost a house, because they were day late and would not have been a dollar short, they had the money.
So, can this market just keep getting hotter? The short answer is yes. We still have lots of contacts waiting to close. We have a lot of inventory coming on the market now, something that normally is a trickle just before Labor Day. These last thre weeks were the hottest of the year when you count sales and contracts. We also have lots of folks looking.
For the glass half empty types, contracts are down a fraction and inventory from $5 – 10 million is up by 7 listings. We also need more inventory under $600K as we only have 1 listing. For me personally, the last two weeks have been the busiest of the year, but fall is coming, a time when the market slows down after a couple of weeks of post-Labor Day inventory increases. This year that slowdown may be much later.