2020 – A Very Good Year for Greenwich Condo Sales

Like the Greenwich single-family home market, 2020 was a very good year for the condo market. Our unit sales were up 51% to 220 sales in 2020 compared to only 159 sales in 2019. Now 2019 was a bad year all around. Sales in 2019 were down 12% from 2018’s 181 sales. Even better than our condo sales number was our 2020 condo sales volume. Sales dollars in 2020 were up 51% compared to 2019’s sales volume of $217,830,079 dollars. If you look at our condo sales in 2018, you see a more average year with 181 sales, even so our 2020 sales at 220 sales were up 22% over this “average” year.

201820192018  vs 20192020  2019 vs 2020
 # Sold$ Sold# Sold$ Sold% ch # sold% ch $ sold# Sold$ Sold% ch # sold% ch $ sold
Jan11$8,901,50012$15,251,5009%71%13$13,191,5008%-14%
Feb9$6,917,7759$9,013,2500%30%13$15,503,00044%72%
Mar11$8,316,90015$10,367,50036%25%15$8,335,4000%-20%
Apr18$19,492,00017$16,954,500-6%-13%11$10,979,500-35%-35%
May13$17,610,00012$9,492,500-8%-46%11$5,729,280-8%-40%
Jun22$23,365,50017$16,105,625-23%-31%16$13,503,750-6%-16%
Jul18$11,953,07717$11,980,500-6%0%17$19,745,0000%65%
Aug22$14,767,0447$6,101,000-68%-59%26$26,990,500271%342%
Sep6$6,630,00012$13,032,250100%97%19$17,960,52458%38%
Oct14$17,843,00013$12,276,500-7%-31%31$26,116,000138%113%
Nov14$15,255,00013$11,315,500-7%-26%17$12,469,00031%10%
Dec23$24,066,00015$11,984,000-35%-50%31$47,306,625107%295%
 Total181$175,117,796159$143,874,625-12%-18%220$217,830,07938%51%

Our sales by month show just how remarkable 2020 was. Our 38% increase in annual sales occurred in just the last five months of the year. We did better in January and February 2020. March was even. April, May and June actually saw sales declines in sales below the same months in an already poor 2019.  Then came the five months of August to December 2020, where sales were 107% higher than in 2019.

Curiously, we had started the year out pretty well with condo sales up in January and February, then came March and sales were flat. April, May and June saw a sales decline over an already poor 2019. We got back to even in July and then the boom started.

We also saw a jump in prices in 2020, though a recovery might have been a better word. Our average condo sales price in 2020 was $990,136 up 9.4% over 2019 when we had dropped to $904,872. However, when you compare 2020’s average sales price to the average in 2018, we were up only 2.3%,

This average illustrates another factor in the condo market, which is that it provides some of our most affordable houses. In 2020 the average house sold for $2.67 million compared to $990K for the average condo. In 2020, condos (which for purposes of this report include the handful of co-ops associations that we have in Greenwich) represent about 26% of our houses sales (220 condos/861 houses). This is down from 2019 and 2018 when condo sales were about 30% of house sales both years. So, in 2020 we saw more people buy condos in Greenwich, but the increase in single-family home sales was even greater. People wanted out of New York City, but most wanted a yard and not a shared hallway and elevator, which they already had in NYC. We do have lots of townhouses and other condos without shared spaces and those were particularly desirable in a pandemic.

Condos sales are concentrated at the lower end. Sixty percent of our condo sales are concentrated under $800,000 even though only represent about 40% of our inventory. That wasn’t true in December, where we saw lots of sales over $2 million. These high-end condo sales represented 32% of December sales compared to only 13% for all of 2020. Many of these high-end sales are units in new developments, where both owners and developers wanted to book the sales before year-end.

Our condo market was very competitive at most price ranges. Under 6 months of supply is the traditional dividing line between a pro-seller and pro-buyer market. Under $800,000 we have only about 3.5 months of supply which is a hot market and from $600 – 800K it is getting even hotter as shown by months of supply with contracts included and December sales annualized. When these bars drop in a steady line, the market is only getting hotter.

Normally, months of supply market-wide is an increasing curve from the lowest price range to the highest price range, but that’s not the case in January. Our most pro-buyer market is from $1.5 – 2.0 million where we have 13.2 months of supply. If you go up to the next price range, we only have 4.7 months of supply from $2 – 3 million. This is partly real and partly the law of small numbers. Right now, we have 11 listings between $1.5 and 2.0 million and only 7 listings between $2 and 3 million dollars. Switch a couple of listing from under $2 million to over $2 million and this dramatic market demand difference shrinks a lot.

What you do want to look at is the market wide condo/co-op months of supply which is a tight 4.9 months of supply, then a slightly tighter 4.7 months of supply when you add in contracts and an amazingly tight 2.9 months of supply when you annualize December 2020 sales.  

Our contracts indicate that we will see a bunch of sales in the $600,000 – 800,000 in the next few weeks. Unless we get a lot more inventory in the next few weeks, this market becomes combat-buying. The victors will be the buyers that enter the process fully prepared.

A Condo Search Strategy

What is a buyer to do? A couple of hopefully helpful thoughts. Try to figure out what neighborhoods you don’t want to live in. A good deal on a nice house, in neighborhood you don’t like, is not a good deal. Open houses are great for this. You can check out the area as well the house. This also saves you time going forward, because you don’t have to look at the houses that are in the wrong neighborhood. Also, when you have a longer time horizon, you can attend open houses looking for features you like and don’t like in a house.

One fun thing to do after seeing a house is write down what you think the house will sell for and then when it does close, check and see how you did. This way when you do find your dream house, you’ll know whether it is properly priced.

In this hot market, with the likelihood of rising interest rates, you may still be willing to wait for the right house to be listed, but be prepared to move quickly. This can make all the difference between winning and losing a bidding war. You can check with your stockbroker about the process and time to cash in stocks if need them for a downpayment. You should talk with your banker and go ahead and get pre-approved. Once you think you will be making an offer in the next 60 days, get underwritten pre-approved so the only thing the bank will need to do is an appraisal.

If you are seller, you want to list your condo at the worst time of the year, the middle of winter, i.e., now. It’s carpe emptor, seize the buyers when they are there. I’ve been involved in three bidding contests so far in January and the one winner in everyone of them was the seller.

Stay tuned, it’s likely to get even more interesting.

Chart, bar chart

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Our biggest month by far for sales was December as people wanted to close before year-end. The election also had an effect as November was slower than either October or December.

Covid Increases Sales by $1 Billion in Greenwich, but Some Neighborhoods See Little Change

In Greenwich’s Hottest Sales Year Why are Some Neighborhood Stats Down?

Covid has had distinctly different effect on neighborhoods in town. It was very much the Goldilocks effect. You didn’t want lots that were too small, but you didn’t want them too far from town. And, while 2020 was amazing year for Greenwich real estate, it was really only an amazing for five months. The first seven months were up and down but averaged out to an average year. Several factors came together in the last five months to make the period from August to December a really incredible period.

Neighborhood# SoldSum of Sold PriceDOMAverage of Sold PriceAverage of List Price/SqFtAverage of Sold Price/SqFtAverage of SP/ASMTAverage of SP/OLP
Banksville5$4,382,500 48$876,500$390$379    1.42897.2%
Byram16$13,485,000169$842,813$453$4331.94493.3%
Cos Cob84$116,042,250204$1,381,455$459$4421.51892.6%
Glenville37$43,902,575142$1,186,556$463$4451.67193.8%
North Mianus13$22,723,450105$1,747,958$524$5131.59996.0%
North Parkway102$300,697,949277$2,948,019$488$4601.33987.5%
Old Greenwich128$299,579,631137$2,340,466$654$6301.62994.2%
Pemberwick9$7,512,000161$834,667$426$4112.16795.0%
Riverside133$345,931,079152$2,600,986$666$6221.50693.2%
South of Post Road84$328,530,352211$3,911,076$784$7211.67490.6%
South Parkway249$816,260,716254$3,278,155$577$5481.44190.2%
         
Grand Total861$2,300,247,502205$2,671,600$589$5571.52691.5%

Townwide, we sold 2.3 billion dollars’ worth of single-family homes in Greenwich in 2020. This was up over a billion dollars or 84%. You can see how these sales were Covid driven as two areas that did particularly well were the four-acre zone North of the Parkway and the two-acre zone in the South of the Parkway neighborhood. The latter was the Goldilocks zone, having larger lots for plenty of social distance seen and being closer to town than the even larger lots north of the Merritt Parkway. Let’s take a look at the neighborhoods and see how each one did in 2020

              South of the Parkway – The 2020 winner, mostly

We had a total of 240 single-family home sales South of the Parkway in 2020. This is up an amazing 120 units from last year or 93%. The total value of houses sold in that neighborhood was $435 million. This was up 114% over 2019.

Now you would think that when sales go up almost 100% that prices would also take a jump and they did but it was more like a small hop. The average sold price per square foot went up 3.2% and the sales price to the assessment ratio went up 2%. The average price actually did go up 11%, but as often happens in Greenwich the jumps in the average and medians is more due to the fact that we had more high-end sales last year pushing these averages up. Townwide sales over $3,000,000 are up 100% last year. While mid-country was where the action was this year, the sales price/sf only went up 2.0%. Lots of folks that were thinking about moving provided enough inventory for 120 more sales.

              Cos Cob

Coming in second place for the largest percentage increase in sales was Cos Cob. This neighborhood checked a lot of the boxes that young families fleeing high-density NYC were looking for. Prices were more reasonable there, than in the two-acre zone in mid-country. Cos Cob also has a variety of lot sizes, 1/6-acre, 1/4-acre, 1-acre and 2-acre zones, so something for everyone.

Another reason that Cos Cob did so well this year is that it had further to come. In 2019, Cos Cob and Riverside got hammered as the SALT limitations on property tax deductions took a big bite out of sales. In 2019, we only had 48 sales in Cos Cob compared to 75 sales in 2018. So, this year’s second place finish is more a Superball bounce. Sales went from 75 to 36 to 84 in 2018, 2019 and 2020 respectively. Having said that sales are up over 2018 which was a good year for Cos Cob as families that didn’t want to pay the premium for Old Greenwich and Riverside found Cos Cob a good alternative.

              North of the Parkway

North of the Parkway had another good year for sales. I say another good year, because backcountry had been the weak sister of neighborhoods for almost a decade. Starting in the 4th quarter of 2018, backcountry properties were such a value, that we saw sales increases from 45 houses in 2018 to 59 houses in 2019 or an increase of 31%. Then came 2020 and sales jumped to 102 sales or an additional increase of 73%. In two years, we saw an increase of 126% in houses sold.

This increase was driven by multiple factors with Covid being the most public factor. Above our backcountry average of $2.95M we a big increase in high-end house sales. Below $3 million, low interest rates and good values drove sales. Another factor that didn’t get much attention, except for here in the Sentinel, was the number of Greenwich upsizers. The common wisdom is that lots of folks were selling their houses and moving to Naples or Hilton Head or Charleston and that does happen and has happened for generations.

This year many Greenwich sellers are upsizing and moving to backcountry. They may be coming from a smaller Greenwich house, or a rental, or be desperate to get out of their parent’s home. (I had all three type backcountry buyers this year.)

Backcountry houses continue to be good values. In 2020, the average sales price in backcountry went down $325,275 and the average price per s.f. went down 4.7%. On the other hand, the sales price to assessment ratio went up 1%. Whenever you see indicators pointing in different directions, it’s an indication that there isn’t only one trend going on in the market.

One trend that we are seeing is that houses that have sat on the market in some cases for years are selling. Of our 102 sales 20% had been on the market for more than a year; two for 6 years. The actual percentage is higher as we still see lots of owners taking houses off for the winter and then putting them back on 90 days later. This tactic is used to reset the Greenwich MLS days on market back to zero so houses that had been on and off the market for years looked like a new listing. Also, big yards are easier to sell on sunny days when they are covered with grass and bordered by flowers rather than snow and dead bushes.

Today, most buyers get their days on market information from the public websites who don’t use Greenwich MLS DOM, but their own DOW or days on their website. We have also seen a bunch of winters with little or no snow, particularly, this winter, so this year winter buys allow for spring renovations and weekends all summer.

              South of the Post Road

This is an interesting area. It runs from Chickahominy to Mead Point and from Milbrook to Belle Haven. It’s a real mix, but sales were up 71% in that mixture of neighborhoods. Total dollar volume was up 102% to $329 million. When the percentage jump in dollar volume is greater than the jump in percentage number of sales, it is a sign of stronger high-end sales.

Days on market also dropped by a month and half, while the sales price to original list price went up from 88% to 90.6%. Both are signs of a tightening market. If you are looking to buy in this area. For the value hunters you have 41 houses, but none are under $1 million. At the high-end you have 8 choices over $10 million, but this is down as we had 8 sales in 2020 over $10 million plus one under contract for $12 million.

              Riverside vs Old Greenwich

In the continuing battle of angels on a head of a pin as to whether Old Greenwich is better than Riverside; Riverside has made a stunning comeback. Last year, Old Greenwich wiped the floor with Riverside as OG sales went up, while Riverside had the second biggest sales decline of any neighborhood after Cos Cob. In this case, SALT caused the wounds as Riverside sales dropped to only 78 sales down 23% from 2018.

This year Riverside sales jumped up to 133 sales an increase of 70.5%  compared to Old Greenwich’s below town-wide average of 33%. Old Greenwich had 128 sales after having 96 last year. Riverside also saw its average price jump by 30.2% to $2.60 million while Old Greenwich’s average sale price was $2,340,466 up $27 from 2019 or a .001% increase.

Not to worry Old Greenwichites, your average sales price to assessment ratio was up 5.4% from last year, while those folks in Riverside actually saw a 4.7% decrease in their average sales price to assessment ratio. When someone from Old Greenwich points out this 10.1% difference, Riversideans should counter with the fact that their average sold price/sf was up 13.5% while the OG SP/sf was down 1.4% or 14.9% better.

So, what does this mean? Just that we have a may have a very busy market, that is undergoing a paradigm shift. Last year we had a lot of shadow inventory, so we didn’t see an inventory shortage in 2020 in most areas of town including Old Greenwich and Riverside. As a result, we are seeing a mix of numbers some up a little, some down a little, but it is the mix of the sales that is causing this momentary “confusion” in the directions of prices. We are certainly not seeing any confusion in the amount of demand.

              Glenville, Byram & Pemberwick

These three neighborhoods starkly illustrate the effect of Covid. You can drive from Glenville to Byram in 5 minutes (1 minute if starting on the Merritt counts). Sales in Glenville were up 43% this year, but this is over a poor 2019 and is also below our town-wide average of a 64% increase in sales. Glenville however looks pretty good when compared to Pemberwick where sales were down 18%, which means they dropped from 11 sales in 2019 to 9 sales in 2020. Part of this is that Covid refugees what more space and part of it is just data randomness. In Byram, sales went from 14 to 16 or an increase of 14%. If you combine Byram and Pemberwick sales were flat.

You should actually take these numbers with an even larger grain of salt as several agents try to take advantage of higher price per sf in other neighborhoods. For example, a half dozen listings around Pemberwick are claiming to be in Glenville and several houses on Byram Shore Drive are using the South of the Post Road neighborhood.

Bottomline, houses under $800,000 sell quickly in Greenwich if they are price properly.

              Summary

Land, square footage, mini-country clubs are all in demand. However, we are still waiting to see a significant uptick in prices. If you slice and dice the data finely enough you can find groups of houses that saw double digit increases, but it will only be when we see the median, average, price/sf and sales price to assessment ratio all point up that we are seeing a general rising price trend.

We may well see this in 2021. Our inventory hit an all-time low at the beginning of the year falling to 287 houses. We are not yet seeing any surge of new listings this year. Assuming we used up most of our shadow inventory of folks that wanted to move Greenwich inventory could stay tight all year.

If the paradigm shifts back to historic norms of people preferring large houses, larger lots and more amenities continues in 2021, prices could spurt quickly

On the other hand, we have world of big issues, so stay tuned.

OVER 1,000 TRANSCATIONS – ONE AMAZING YEAR IN GREENWICH REAL ESTATE

The 2020 Year End Real Estate Report

by Mark Pruner

One thousand and three transactions, that’s what we did last year. These 1003 transactions consisted of 861 sales up 334 houses from 2019 or 63% and 142 contracts up 70 houses or almost a 100% increase. And, it wasn’t like these sales and contracts were concentrated in any particular price range. Literally, every price range, except our lowest price range was up. Even, the fact that sales under $600,000 were down, may indicate a stronger market as houses were priced out of our lowest price range and pushed over $600,000.

As of 1/1/21 (GMLS)InventoryContractsLast Mo. SoldsLast Mo Solds+ Contracts YTD Solds YTD+ ContractsMos SupplyMos w/ ContractsLast Mo. Annlzd
< $600K121317190.70.71.0
$600-$800K12871546543.13.01.7
$800K-$1M12681455612.62.71.5
$1-$1.5M362814421491772.92.72.6
$1.5-$2M191916351541731.51.51.2
$2-$3M483519541922273.02.92.5
$3-$4M381910291231423.73.63.8
$4-$5M241141545566.45.86.0
$5-6.5M2736940438.18.54.5
$6.5-$10M459413253421.617.911.3
> $10M25224151720.019.912.5
          
TOTAL2871429123386110034.03.93.2

Our biggest winners this year compared to last are sales and contracts from $3 million all the way up to $40 million. In all 5 of these high-end price categories, transactions were up by over 100%. By numbers, we saw an increase of 155 more houses sold or under contract at our high-end. The biggest winner for the year was the $3 – 4 million price range where sales were up 132% from 53 sales last year to 123 sales this year.

In our highest price range, over $10 million, sales were up 114% from 7 to 15 this year. Now when you have 861 sales in a year, 15 sales may not sound like that much, but those 15 sales totaled $217,400,000. If you start with our least expensive sale and go up, you need 224 sales to total the $217 million represented by these 15 years. Our over $10 million market was actually better than that. These are the Greenwich MLS sales numbers, and they don’t include the $42 million sale on Indian Head Road in Riverside, nor does it yet include the John Street contract for Tommy Hilfiger’s house listed at $47,500,000. If you include just those two sales, you’d be looking at over $300,000,000 of ultra-high-end sales (assuming the John Street house gets close to list.)

              $2.3 billion in total home sales

In total for 2020 sales, we had $2.3 billion in single family home sales in 2020. This is in one year, in a town of only 62,000 people. Back in 2019, our total sales volume was only $1.25 billion meaning our total volume was up 84%, most of which happened in the second half of the year.

What is really remarkable is that 2020’s $2.3 billion in public sales exceeds our previous record for sales which was set 16 years ago in 2004. That year we sold 978 houses for a total of $2.17 billion dollars, and that number includes both public and private sales.

              A remarkable 2nd Half and 4th quarter

The 4th quarter saw sales increase by 143% over the 4th quarter of 2019. Total sales volume increased even more from $251 million in sales in the 4th quarter of 2019 to $804 million in sales or an increase of 221%. Even in this remarkable year, our 4th quarter was head and shoulders above the prior quarters for percent increase, which bodes well for the first quarter of 2021.

                            Quarterly Sales Numbers

While the first quarter was better than 2019, it was much like our 10-year average. In the second quarter, when Covid had its greatest negative impact, April was slow as we went into lockdown followed by a better May and June as we saw the beginning of an exodus of families from New York City. Our second quarter while better than the poor Q2 2019 was still a little below our 10-year Q2 average. Then came the third quarter and sales took off. July was better than average and August and September were our highest months of the year.

2020 QuartersNo. of SalesSales VolumeSales DifferenceVolume Difference% Sales Diff% Volume Diff
Qtr1103$219,985,16629$49,607,11839.2%29.1%
Qtr2165$443,697,56313$62,933,7128.6%16.5%
Qtr3311$833,006,153127$385,327,26369.0%86.1%
Qtr4282$803,558,620166$552,962,154143.1%220.7%
Grand Total861$2,300,247,502335$1,050,830,24763.7%84.1%

What was amazing about the 4th quarter was that sales just stayed high. Normally the 4th quarter has about 21% of our sales as things slow down for the holidays; that’s not what happened in 2020. We got 3 consecutive months of sales numbers in the 90’s. The 4th quarter of 2020 represented 35% of sales. The 4th quarter sales numbers were 282 house sales, up 166 houses from 2019 or 143%, and up 147 sales from our 10-year average.

                            High-End Sales in 2020

We saw a big jump in the average sales price from $2.14 million in the 1st quarter to $2.85 million in the 4th quarter or a 33% price increase. This price increase was driven by the increase in the high-end sales in Greenwich that started in June. The June increase was expected as many sellers wanted to avoid the Gold Coast tax; the 1% increase in the state conveyance tax for sales over $2.5 million that kicked in on July 1st. What was surprising was the continuing increase in high-end thereafter. While these high-end sales increase are certainly encouraged by Covid; it also seems to be tied to higher levels of violence and shootings in New York City.

              Average Greenwich sales price up 12.4% in 2020

In 2020, our average sales price was $2.67 million up 12.4% from our 2019 average sales price of $2.38 million. The median sales price was $2.08 million up 11.4% from 2019’s $1.87 million median. Our average sales price peaked at $2.97 million in 2007. We still have a way to go get back to our 2007 peak, but we are getting there with double digit appreciation. (BTW: All this historical data is from my brother Russ, who has a great website with historical data at russellpruner.com.)

Now, as I constantly write, most of the change in both the average and the median sales price is not due to a general appreciation of all houses, but a change in the mix of what is selling. If you double the number of sales over $3 million you will get a big jump in our median and average sales price.

A better way to get a feel of how your house value is doing is to look at the changes in the sales price/s.f. and the sales price to the assessment ratio. Our sales price per square foot is up 4.1% over 2019. Our sales price to the tax assessor’s assessment is up 3.1% over last year’s SP/Assmt ratio. So, by this measure, house values are up 3 – 4% in Greenwich for 2020, but if you are talking to someone from Darien you can let them know our average price is up 12.4%.

              Inventory and Months of Supply Way Down

The one stat that probably should get more attention right now is inventory, because it is at record lows. Our 287 house listings are down 145 listings from last year or a drop of 34%. For the last several months our inventory has been down about 25% from last year, but it held steady at that level, meaning that new listings were coming on about as fast as they were going off.

In December, as usually happens during the holidays, new listings slowed down, while sales stayed high with 91 sales compared to a 10-year average of 54 December sales. The result was both inventory and contracts shrank. At the beginning of December, we had 378 listings and 171 contracts, by January 1st we were down to 287 listings and 142 contracts. The drop in inventory was not solely due to sales, we had 17 listings expire unsold at year end on December 31st. Regardless of the cause, 287 home listings is a historic low for inventory. 

If you compare the months of supply at the beginning of 2020 with months of supply at the beginning of 2021, the difference is startling. Last year from $4 – 5 million we had 26 months of supply. This year we have 3.7 months of supply. That dramatic drop is true across all price ranges. For the entire market we went from 9.8 months of supply at the beginning of 2020 to only 4.0 months supply at the beginning of 2021.

              We Need a Lot More Inventory

I was hoping that a lot of sellers were waiting for the new year to put their house on the market, but that is not what we are seeing so far. In the first few days of 2021 we have seen only a handful of new listings. This lack of inventory is the biggest present threat to 2021 being a good sales year.

 If you are thinking of selling your house call me or take advantage of the fact that everyone in Greenwich has zero degrees of separation from a Realtor. With over 1,100 dues paying GMLS members, you probably have a neighbor, a tennis buddy, a club member, a carpool friend or a fellow school parent that is an agent. Call me, call them, please do it this weekend.

The ideal time to put a listing on the market is when supply is low, and demand is high. This is exactly what we have now.

              What Will Happen to Greenwich Real Estate in 2021?

How will this year play out? The one thing you can be sure of is that no one knows. Covid cases are reaching record highs across the U.S., but Connecticut has been one of the most successfully states in getting people vaccinated. We have a hot market, but low inventory. It is a great time to list your property, but January is not known for a lot of listings.

In 2020 we had lots of people who had been waiting for years to list their properties for sale, do we still have that number of people or has our shadow inventory mostly disappeared? Prices in New York City are dropping, and people are getting the vaccines, will the NYC real estate market return to normal? Federal relief bills are authorizing record amounts to stimulate the economy, leading to record amounts of debt, what happens when interest rates tick up? I could go on and on with countervailing factors, but there is no way of knowing which factor will outweigh their countervailing factor.

Stay tuned, it’s going to be a really interesting first quarter.