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||# Sold||Sum of Sold Price||DOM||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||84||$328,530,352||211||$3,911,076||$784||$721||1.674||90.6%|
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.
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.
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.