Overall Greenwich Real Market Continues Very Busy but Varies by Neighborhood

                October Mid-Month Update

We have sold 52 homes through October 16, 2020. Our 10-year average for the whole month of September is only 49 houses. So, we have already sold more in half a month than we normally sale in the whole month of October. We also have 178 contracts so once again we have a good chance of having over 100 sales for the month and have record sales for any October.

If you add the 173 contracts that we have signed now to our 577 sales, we have had in the first nine months you come up with 747 sales for the year. This would be our highest number of sales in the 21st century. What’s even more amazing is that the 4th quarter generally is only 21% of our sales. It will be much more this year.

When you look at our sales and contracts for the last three months by week, the weekly transactions zig-zag, but even the low points are at a higher level than we saw in the first half of the year.

Total 2020 Greenwich House Sales and Contracts by Week

Our totals are all looking good with our average and median sales prices up 9.0% and 12.5% respectively compared to year-end 2019. When you look just at 116 September sales, our average and median prices are up even more as you would expect in an accelerating market.

On the inventory side, we are down at just about every price level. Our prices are up and so are our sales and contracts.

            September 2020 YTD Neighborhood Report

Looking at just these numbers you would think that everything, townwide is rosy. If, however, you look at the individual neighborhoods in Greenwich, you see a more nuanced stories. Some neighborhoods are down in some categories and some neighborhoods are doing remarkably well compared to last year, but they still have a ways to go.

When you look at the neighborhoods, certain areas and numbers jump out. Backcountry and mid-country are doing very well this year, while Byram, Pemberwick, Banksville and North Mianus are not doing much better and in some statistical categories are actually doing worse. The one factor that ties all this together is acreage. If you have bigger lots in the pandemic year of 2020, you are doing better. If you have less acreage per lot, the demand has not increased much this year.

            Backcountry

One of our hottest areas has been backcountry where sales are up 74% for the year. Our contracts are up an amazing 140% this year. We have sold 68 houses and have 24 under contract. While this is a remarkable turnaround this year in many ways, all this gain has just gotten backcountry back to even. When you look at the inventory of 83 houses compared to the sales of 68 houses you come up with 11.0 months of supply. The second highest for any neighborhood. Add in the 24 contracts and things look a little better with 9.5 months of supply which is down by 14 months of supply from last year.

Backcountry Sales 2020 (as of 10/17/20)
Sold (Blue)                                          73
Pending (Yellow)                              16
Contingent Contract (Green)      9

This increase in backcountry sales actually started in 2019 when backcountry sales for 2019 were up 30% compared 2018 (which tells you just how bad things had gotten in backcountry by 2018). The other big change is where the sales and contracts are in backcountry. In short, they are everywhere, which is a change from prior years. In 2018 and before, the further you went out in backcountry the harder it was to sell. Now, backcountry is backountry. Sales are spread throughout the 4 acre zone and there is even a concentration along the north border as folks from Westchester want to escape the harsh impact of the $10,000 SALT cap on taxes, but still want to be close to their friends in Armonk and Bedford.

                        Mid-Country

The area that has done the best in 2020 is mid-country or South of the Parkway as the Greenwich MLS calls it. There sales are up 60% less than backcountry’s 74% increase, but contracts in mid-country are up an incredible 292% to 35 contracts compared to only 12 contracts in 2019. We also have 8.9 months of supply, the type of number you used to see some years for Riverside. Total sales in mid-country are $553 million or up $221 million from 2019.

 Also, in md-country the average sales price is up $137,045 while the average sales price in backcountry is down this year. Neither of these numbers are particularly indicative of what individual house prices are doing. They indicate more higher-end houses are selling in mid-country and more houses below the backcountry average north of the Merritt. The changes in the mix of what is sell are causing these numbers to jump around.

For a better indication of how individual house values are doing, look at the price/sf and also the ratio of this year’s sales prices to the 2015 assessment values. These number are less effected by what price points are selling. When you do that, you see that both these numbers are actually down a little bit. What we are seeing are lots of motivated sellers meeting the bids of even more motivated buyers. Once this group of sellers who have been waiting to sell is used up, then you will see more bidding wars and prices going up. Of course, this assumes that a couple of trillion dollars of new government debt and continuing high unemployment don’t lead to a recession next year. So far average and median prices are moving up. In September, both the average and median sales prices were up compared to those numbers for the whole year of 2020.

                        Riverside, Cos Cob & Old Greenwich

These three neighborhoods in the southeast part of town have traditionally been our family neighborhoods and as such they have done very well this year. We have lots of families that have been cooped in small apartments in NYC with some vary restless kids who are buying up houses left and right in these neighborhoods. Old Greenwich has 3.4 months of supply which is the very definition of combat buying. If you are buyer, you need to be all cash or have a mortgage application that is underwritten pre-approved, because you are not going to be the only people interested in the houses that are properly priced.

In Riverside, it’s not tooth and claw, but it is still hot with only 4.7 months of supply, so be prepared. Cos Cob is actually at 6.7 months of supply, but this is down from 12.8 months of supply at this time last year; 2019 was not a good year for Cos Cob, but 2020 is.

                        Glenville

Glenville has been much like Cos Cob and has done better than its southerly neighbors, Pemberwick and Byram. Glenville has an inventory of 16 houses and has already sold 22 houses with another 10 under contract. This equates to 6.5 months of supply for sold houses and drops to 5.3 houses when you add in the contracts.

Glenville also has the greatest increase in sales price/sf at 11.1%. We are seeing some real property value increases in this area. You wouldn’t know this however if you looked at the average sales price which is down 19.6%, This is the kind of jumps that you see where you have less than two dozen sales and the loss of a couple of high-end sales while also have a couple of more sales under the average. So, all the Glenvillians should focus on price/sf and ignore the averages.

                        Pemberwick & Byram

The market is not bad in Pemberwick and Byram, it is just didn’t get any hotter this year. The irritating thing about these two areas for us Realtors is that people who move in really like it and tend to stay here so from year to year we don’t have a lot to sell. Right now, we have 2 houses on the market in Pemberwick and 10 houses on the market in Byram.

With 4 sales in Pemberwick we are looking at 4.5 months of supply, which is just the same as we had last year. It’s still hot, it just didn’t get hotter. Part of this may be that buyers who are fleeing New York City are looking at smaller lots and options throughout Westchester and Fairfield Counties. This can not be said of buyers looking for 2 and 4-acre lots, as many towns don’t have large lot zones.

Byram has had 13 sales this year which equates to 6.9 months of supply, essentially the same as last year’s 6.8 months of supply.  Both the average price/sf and the sales price to assessment ratio are up slightly in Byram.

            Summary

Our market took off in June and has risen to levels of demand hardly ever rarely seen in the last 40 years. We are quickly working our way through our shadow inventory (a term I never understood, but Halloween is this month, and I’ve always wanted to use it). Once most of the folks that have been waiting to move up, move out or downsize have done so, we are going to see an even tighter market.

Right now, we really need inventory to meet our demand;  not something you normally say in October. If you do list now, however, trying the premium price route may well not be effective. You’ll get showings but if you do get offers, they may not be what you want. On the flipside, if you price your house to this market, you have a very good chance of having a contract before year-end even with the holidays coming up.

Mid-October Greenwich R.E. report – Still looking good

So far this month we have sold 52 homes in October 2020. Our 10-year average for the whole month of September is 49 houses. So we have already sold more in a half month than we normally sale in the whole month of October. We also have 178 contracts so once again we have a good chance of having over 100 sales for the month.

When you look at our sales and contracts they zig-zag, but at the highest level for the year.

Total 2020Greenwich House Sales and Contracts by Week

One of our hottest areas has been backcountry where sales are up 74% for the year.

Backcountry Sales 2020 YTD (10/17/20)
Sold (Blue)                                          73
Pending (Yellow)                              16
Contingent Contract (Green)      9

This increase in backcountry sales actually started in 2019 when backcountry sales for 2019 was 30% higher than we had in 2018. It’s going to be an interesting 4th quarter.

September Greenwich R.E. Sales Set Another Record

Why Aren’t Prices Up More

Once again sales of single-family home in Greenwich set a record with 116 sales. This is up 150% from last year. We’ve never had a September with triple digit sales. Post-recession, the highest number of sales reported on the Greenwich MLS were 63 sales in 2015. Given that we had 193 contracts as the end of August, I expected that we would have a very good September as these contracts closed, but I’m still surprised that sales set a new post-recession record for any month.

For the year, we have sold 577 houses in Greenwich and this is more than the 526 houses we sold in all of 2019. Now 2019 was not a great year, but we will easily break the 600 house sales level this year as we have 173 contracts waiting to close. Any year over 600 sales is a good year for Greenwich. But we will likely be over 700 sales, which makes for a great year. If you just take the 173 contracts, we have outstanding, also up 150% over last year, and add them to the sales YTD, you come up with 750 sales and contracts. We might even exceed 800 sales.

I say might, because our 173 contracts are down from our 193 contracts at the end of August. It’s possible, we may finally see the sales curve start to drop in October as our contracts are down 20 from August. It just depends on how many of the 173 contracts that we have waiting close, actually close in October versus later in the year. In a normal October, we sell around 41 houses. We should easily double that this year and might make it three months in a row with over 100 sales.

The market last week was as hot as it has been all year, when you look at our weekly transaction, sales and contracts signed. Last week we tied our previous high for the year at 68 transactions.

All these transactions are sucking up inventory quickly. We are down to 477 single family homes or down 23% from last year when we had 622 listings at the end of September. For every price category below, our inventory is from last year.  

Over $10 million we are up 2 listings to 35 listings. As we are seeing an increase in high-end sales over $5 million, we are seeing more people listing their houses. This increase in listings over $5 million has been mostly matched by sales. The result are big drops in months of supply starting at $3 million and going up. For example, when you take the 8 sales over $10 million and add in the 4 contracts, the months of supply have dropped from 4 years of supply to 2.5 years of supply.

Over $5 million, we went from a cold market to a warm market. From $5 – 6.5 million, we only have 14.4 months of supply. Drop down to $3 – 4 million and you are looking at 7.2 months of supply. This is the kind of number you see in Greenwich around $1 million not at triple that price.

As of 10/1/2020InventoryContractsLast Mo. SoldsLast Mo Solds+ Contracts YTD Solds YTD+ ContractsMos SupplyMos w/ ContractsLast Mo. Annlzd
< $600K114515160.60.70.3
$600-$800K16751229365.04.73.2
$800K-$1M151282038503.63.21.9
$1-$1.5M48371249981354.43.74.0
$1.5-$2M552723501011284.94.52.4
$2-$3M1003226581351676.76.33.8
$3-$4M75252045851107.97.23.8
$4-$5M4112517294112.710.58.2
$5-6.5M417714233016.014.45.9
$6.5-$10M509413162528.121.012.5
> $10M3542681239.430.617.5
          
TOTAL4771731162895777507.46.74.1

When you take the September sales and analyze them to calculate months of supply you can see big drops from $1 million all the way to the very top. I have a listing that I put on last week at 343 Sound Beach Ave in Old Greenwich for $2,195,000. It’s an older house, but it has been freshly renovated and hit a sweet spot with lots of showing right out of the gate.

I’m seeing the same thing at 677 River Road in Cos Cob, which is on for $1,3900,000. This is a nice 2,500 s.f. house on 1.1 acres. Being on River Road it slopes up from the Mianus River and has a limited backyard, normally a significant issue for families with kids, however, with limited inventory we are seeing more showings to families than we are to downsizers who often want less yard to maintain. Removing a few trees to create a yard when you only have 3 – 4 months of supply starts to look much more viable to those young family buyers.  

                House prices up 15.2% in Greenwich – Sort of

I was talking to brother, Russ Pruner, a Realtor since 1980, who has seen a lot of ups and a couple of downs in Greenwich real estate. We were both marveling at how all this demand hasn’t pushed up prices more. When you look at the sales price to assessment ratio for 2020, we are only up 1.0% for the year in sales price. On the other hand if you compare the average sales price for this year so far to last year, we are up from a 2019 average of $2.38 million to $2.59 million or an increase of 9.0% which matches some of the price increases that we saw in the 80’s, 90’s and early digits. In many of these years we were seeing double digit percentage increases in prices per year. In 2004 we sold 835 houses listed on the Greenwich MLS and had another 144 private sales.

If you want a dramatic number, the median increase is 15.2% in sales price for September 2020 compared to last year’s median. Much of this apparent appreciation is simply that we are selling more houses above the median this year. We are though seeing real price increases in the last two months as you would expect with sales over 100 house these last two months.

I know, what you are saying, which is how much is my house up? My best guess 4 – 6% with much of that coming in the last couple of months, but why isn’t it more? First off, each house is different and is its own micro-market. Houses that need work in Byram have not increased like moderately priced houses in mid-country, then again Byram saw some of our best appreciation pre-Covid.

Also, as I’ve written before, Covid buyers are running from NYC and are looking at lots of options, particularly under $1.5 million. I actually had a Covid buyer, who was interested in Greenwich, ask me how it compares to New Canaan, a very common situation, but then she asked me about Wilton and Fairfield, not towns that we usually compete against for buyers. Despite all this new “competition” Greenwich is doing just fine in the marketplace.

Curiously, for all the talk of multiple bid situations only 14 out of the 116 sales in September went for over list. Given that, with winter and the holidays coming up, now is not the best time to go with a premium list price. Save that for the spring market when you’ll have time to adjust the price if you over-price the house.

We are seeing other stats that are likely to lead to increased prices. September sales were on for a median of only 96 days compared to 140 days in July. The sales price to original list price was 95% compared to 92% in July. Lastly our inventory is continuing to stay down, making for a competitive market. Normally, I don’t suggest listing your house in October, but I do this year, and the sooner the better.

The $2 billion question is will we make to 800 sales this year. We’ll have no problem with 700 sales as we already have a total of 750 sales and contracts with a whole quarter to go. We’ll need about 75 sales in each of the next three months and that shouldn’t be a problem in October. But our contracts have dropped from 193 at the end of August to 173 today and we have the holidays coming up. We also have the election uncertainty, never a good thing for house sales, and Covid cases are going up again in parts of NYC. We’ve still got a good shot at making it, if we get anything like the number of contracts signed in October as we saw in August and September. Stay tuned, it will be an interesting 4th quarter.