February 2021: Greenwich Real Estate Transactions Double
Inventory Cut in Half
The number you want to remember for Greenwich real estate in February 2021 is “2”. Our sales and contracts are 2x what they were last year in the second month of the year. Our February sales were more than double last year, and contracts were nearly double. Our inventory is down to barely 1/2 of what it was last year. Our median price for 2021 sales so far is $2.2 million, which is up almost 20% from February last year. We have too little inventory for sales to continue at this pace.
Once again, the Greenwich real estate story has been turned on its head. Sales are important, and they are up this year. To be precise sales for the first two months of the year are up 68 sales from 2020 to 129 sales this year or an increase of 90%. Our contracts are up from 75 in 2020 to 148 contracts in 2021 or 97%. While this is a stunning change, it is not what’s going to define our market in 2021; that is our inventory numbers.
Our inventory is at record lows. As of the end of February we only had 277 single family home listings in Greenwich. This compares to 513 listings at the beginning of March 2020. We started the year at 287 listings also a record low and briefly struggled up to 300 listings, but since then we have actually been drifting down in the net number of listings. Right now, we should be adding dozens of listings each week as our spring inventory comes on the market and sales are usually at their low point for the year.
When you look at certain price categories you can see just how tough it is for buyers out there. From $800,000 to $1,000,000 we have 7 listings; last year at this time we had 25 listings. We actually have almost as many contracts as we have listings in this price range. The result is that our months of supply in this price category went from 16.7 months of supply last year to 2.8 months of supply this year or a drop of 83%.
Under $600,000 our months of supply is zero, as in we don’t have any houses, when at least last year we had 4 listings. This really speaks to how unique our market is. According to the NAR, the median house sales price for the entire US in January was $303,900. Half of the houses in the U.S. sold for less than $304K and that median sales price was actually up 14% from last year. In Fairfield County as a whole, the median sales price was $550,000, which was up 22% from January 2020 according to the Smart MLS. Right now, the lowest price house on the GMLS is $625,000 more than twice the national median and $75,000 higher than the Fairfield County median sales price. We live in a very unique market.
It’s not just the lower end of our market that is seeing these remarkable year over year changes. All the way up to $5 million we are seeing 6 months or less of supply. When you throw in our 97% increase in contracts, then we are seeing about 6 months of supply all the way up to $10 million.
Above $10 million we have 23 listings down 21% from last year’s 29 listings. We are looking at 15.3 months of supply at the ultra-high end due to our 3 sales (and we have two more ultra-high-end contracts). I can’t compare these sales to last year’s sales as last year we had no sales over $6.5 million last year through February. In fact, in 2020 our first sale over $6.5 million didn’t happen until May 11, 2020 despite having over 80 listings.
Inventory our 2021 sales determinate
Inventory, at all price ranges, is going to define what kind of market we have this year. If we get back to anything like normal inventory levels, we are likely to have a very good year. We have two big Covid related factors that are driving our market. Clearly, we are seeing many New York City families and other individuals looking for more space in their homes and no shared hallways, stairs, or elevators. They want to be able sit in their backyard and not have to wear a mask. The pre-pandemic perks that kept people raising children in a 1,200 s.f., NYC apartment are all shut down or have limited access. Museums, concert halls, lectures, exhibitions, and restaurants aren’t available or are restricted, making those apartments feel smaller every day. NYC is just not as cool as it was before.
The other factor that doesn’t get nearly the attention that it deserves, is the number of Greenwich families that decided to upsize in 2020. I had six sales last year where the buyers were doing just this. I was elected to the Board of Assessment Appeals and we are hearing assessment appeals this week. Three quarters of the appeals that I heard were from Greenwich residents who had bought another house here in Greenwich.
It could be that our out-of-town buyers didn’t know about the appeals process, but I will say that every buyer I had last year asked about taxes and assessments. It could also be that our local residents know how to find particularly good deals even in a pandemic. Regardless, lots of our Greenwich residents have been upsizing and our older homeowners continue to downsize here in Greenwich at similar historical rates. Some are going to Florida and other southern climes, but they have already done. The impression is that in the Covid era, that’s increased, but there is no good way to quantify people’s reasons for moving.
One thing that is clear is that we had lots of local homeowners that were willing to list their houses last year. Our sales were up 334 houses in 2020 over 2019 for total sales of 861 houses. Much of this additional inventory were from the so called “shadow” inventory of people that had been waiting years to sell. The question is how much shadow inventory is left, based on the first two months, the answer maybe not much. Then again sellers may be waiting for the crocuses and the climatic spring.
The Covid Housing Paradigm Shift
One of the main factors driving our intra-Greenwich buyers is that lots of Greenwichites need a different house. Today’s buyers want two, and even three offices. Kids also need virtual schooling area(s). Parent’s don’t want the school site to be in a remote bedroom on the third floor. At the same time, we are seeing some movement away from the very open floor plan. When the whole family is home, the whole day, for the whole week, having some private get-away space becomes a necessity.
The next couple of years will show whether these shifts in peoples housing needs becomes the new normal or if this is only a phase that will pass when Covid passes away. Given that the present predictions are that Covid may hang around much like the flu, albeit at much lower number of infections, the most likely result is that we will see a little of both. Some renters will return to NYC permanently and some pandemic renters have decided to take up full time residency here.
What isn’t going away are summer rentals. Many Greenwich homeowners who rented their houses last summer found it was a nice way to make a good amount of money in short time. It looks like most of the tenants liked their summer rentals as there are presently zero summer rentals available, though inquiries show that the many landlords are re-renting their houses again this summer.
A good time to list
I hear that some people are waiting for warm weather to list their house. With all the snow we’ve had it doesn’t look very springy, but it’s not the calendar or the weather that determines when the best time to list a house is but supply and demand. We don’t have much of the former and so have lots of the latter so now is a good time to list a house.
Stay tuned from a real estate viewpoint, 2021 has the potential to be even more nail biting than was 2020.