All Greenwich Neighborhoods do Well, Some Very Well in First 3 Quarters of 2021

Contracts Down, but Recently Rising

by Mark Pruner

Greenwich had an amazing first nine months with sales up 44% and sales volume up 66%. These big increases are even more amazing, because they were increases over our record setting 2020 home sales. Last year was a great year, but so far 2021 has been an even better year and that is true for every neighborhood. So, let’s give out the awards for most amazing performance by a neighborhood on a year over year basis.

              Biggest Percentage Increases from 2022

                            Award: Our smaller neighborhoods

When you look at neighborhoods by percentage increase in sales, one neighborhood jumps out, Pemberwick, with sales up 250% on a year over year basis. Pemberwick’s sales increased from 4 sales in the first 9 months of 2020 to 14 sales this year. An increase of 10 sales may not seem like much, but it’s the first time in a while since we’ve seen Pemberwick home sales break into double digits. It’s a small neighborhood and the people there love it. They tend to buy and stay, meaning even fewer houses come on for sale.

It’s not just Pemberwick, Byram saw sales increase from 13 to 19 and North Mianus went from 5 sale to 10 sales. Banksville also saw its sales jump 67% from 3 sales to 5 sales. These are small numerical increases, but together they total an increase of 23 sales and tell us something about the market. There is a tremendous demand for houses in our most affordable neighborhoods.

Lots of people who live in apartments in the NYC metro area would love to have a house in Greenwich and the most affordable houses in Greenwich are often their first choice. While, we can’t know whether there are thousands, of even tens of thousands of people, that fall in that category, we can say that at least 23 homeowners found new homes in these neighborhoods worth buying, even with price increases up to 25% in one year.

              Our Hottest Neighborhood

                            Award: Riverside, close runner-up Old Greenwich

In Riverside, we had 134 sales in the first nine months of 2021, this is up 41% from the first nine months of 2020. This a lot of sales in a small geographical area, but it’s a highly desirable area of Greenwich. Driving around with a real estate app you felt like every third house had sold, is under contract or is about to be. In Riverside, the median days on market was only 44 days and prices appreciated by 17.8% based on the year-over-year increase in the sales price to assessment ratio.

Not everything went to contract quickly. One waterfront house took 429 days to sell, and I co-listed another waterfront home that took 299 days to get to contract. Now both were well over $6 million and high-end negotiations often get tricky, but long sales times aren’t de rigueur for high-end Riverside houses. The highest sale in Riverside went for $7.8M, in 23 days. The listings that stay on the market for months make the Riverside average of 85 days on market very understandable and impressive.

Some people, (mostly those who live in Old Greenwich), would argue that Old Greenwich was the hotter market. Yes, Old Greenwich “only” had 126 sales to Riversides 134 sales, but it’s median days on market was a highly competitive 26 days to contract. Also, if you look at Old Greenwich’s price appreciation on sales price/s.f. it’s at 21.3% compared to Riverside’s 11.7%, but that’s more an issue of a few outliers for Old Greenwich. Often, this is due to a new construction replacing a teardown, but the square footage of the old house is still on the tax record, which leads to a very high sales price/sf.

To decide the hottest market of these two, let’s go to the tiebreaker, the most houses sold over list price. Old Greenwich had 41 houses that sold for over the house’s original list price, while Riverside had 48 houses that sold for over OLP. Riverside is the winner for our hottest market for the first nine months of the year. Let’s see how it plays out for the full year.

The High-End Award

              Backcountry vs. Mid-Country vs. the Waterfront Associations

One of the things that make Greenwich so attractive is that we have a variety of communities and at the high-end Greenwich gives you a lot of choices. Over $5 million, you have your choice of Backcountry with 4 acres and excellent privacy; mid-country with one and two acre lots and closer to downtown; and the waterfront associations; Belle Haven (including Field Point Circle), Indian Harbor and Mead Point.

So far, our highest reported sale is for $45 million in backcountry. I say reported sale, because the market over $5 million and particularly over $10 million is very private with many sales going unreported. (This award is only based on the publicly reported listings on the Greenwich MLS.) Even though this sales price is almost twice the sales price reported in the Belle Haven area, it’s only a single sale and one of only two sales over $10 million in backcountry.

South of the Post Road, in Belle Haven, we have 6 sales over $10 million and an additional 10 sales over $5 million. All the sales are part, of the great reshuffling in Belle Haven as we have a good number of listings in one of our nicest areas and good demand for these listings. Below the Post Road you can throw in an additional 4 sales for a total of 20 sales over $5 million south of the Post Road. This compares to 19 sales in backcountry a much larger area.

If you want to talk about larger areas, South of the Parkway runs from the Merritt Parkway to the north side of the Post Road and has the by far the largest number of properties of any Greenwich neighborhood. For the first nine months of 2021, we have had 58 mid-country sales over $5 million and 3 of these were over $10 million. Compare that to the first nine months of 2020, when we had less than half that number with 28 sales over $5 million. Townwide our sales over $5 million are up 265% from 2019 our last pre-Covid year.

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Sept 2019 YTDSept 2021 YTD Sept 2021 YTD

Sales in Greenwich, CT over $5 million for the first nine months of each year

The biggest percentage increase in sales over $5 million and highest sales YTD goes to backcountry. Greatest increase in number of sales goes to mid-country and greatest increase in sales in a single association easily goes to Belle Haven.

              What about the Fourth Quarter

                            Update

At the end of the third quarter, things were looking bleak for Q4 2021. Our contracts had reached a low for the year with only 102 contracts and inventory was at record lows. Our contracts were 41% below last year and the number of contracts had been dropping for 4 months. Last year was an excellent year all the way through year-end, so being below last year in contracts is not that bad. To see a really terrible slow down go back to September 2019 when we had only 69 contracts at the end of September.

Overall, our contracts, in just about every part of town, had been dropping for 4 straight months. Luckily that stopped in October. We are now up to 118 contracts as our fall market sales kick in. The uptick is even more heartening when you consider that our inventory is at an all-time low with just 246 listings. Of those 246 listing, I bet 10 – 20% already have an accepted offer and are just waiting for contracts to be signed. In addition, a quarter of the listings are more than 6 months old, so our “active” active listings are something like 130 to 150 listings, which means buyers often have only a handful of options in a particular price range in a particular neighborhood. (Our otal listings between $1 and 1.5 million in Riverside comes to only one listing.)

The concern is not low inventory, we’ve had that all year. The concern is dropping inventory. This is like watching the gas gauge on your car dropping to “E”. We can go a long way on a quarter of tank of gas, if we keep putting in a little gas here and there, but without continuous replenishment of our low tank, our market is going to sputter, and contracts are likely to resume their fall.

It is the second half of October, but arguably this is the best time to list your house with good demand and very limited inventory.

 Stay tuned, the 4th quarter promises to be particularly interesting….

Mark Pruner is a sales executive with Compass real estate in Greenwich. He can be reached at 203-969-7900 or mark.pruner@compass.com.

GREENWICH Q3 & YTD 2021 ARE ALL-TIME RECORD FOR SALES

Inventory at Record Lows

by Mark Pruner

Overview

              Greenwich Home Sales up 44% to New Record

Greenwich just had an all-time record third quarter with 319 sales which is higher even than the prior record in the Covid-driven third quarter of 2020. For the first 9 months, we saw 832 homes sold, up 44% over 2020, the prior record 9 months.  Those 832 sales are more than a full year’s sales for any year, but 2 of the last 22 years.

       Value of sales up almost $1 billion

Our total sales volume for the first nine months of 2021 increased by almost $1 billion from last year’s $1.495 billion sales to this year’s $2.478 billion, or an increase of $983 million. Last year total sales volume for the entire year of 2020 was $2.300 billion, so we are already $178 million ahead of total sales for last year, with 3 more months to go in the year.

       All while inventory was low

Our inventory has been low all year as houses priced right went to contract almost as quickly as they came on. We had 993 new listings, which fueled our record sales in the first 9 months. Our sales are slowing down as listings are coming on at a slower rate. Our shadow inventory of people who had waited years to sell is gone, but luckily, we are getting listings from lots of upsizers in Greenwich selling their “smaller” houses.

       WOOFH driving sales more than Covid

Once vaccines became available in the first quarter, you might have expected sales to decrease, but this didn’t happen. In the second and third quarters, WOOFH (Working Occasionally or Often From Home) has been a major factor driving the market. While NYC is not getting any closer, the time spent commuting is shrinking, often down 60% to 100% for Greenwich buyers as people don’t have to go into offices as frequently or at all.

       Sales over $5 million up 265% in two years

Our over $5 million sales have increased 91% over last year. Our over $5 million sales are up a huge 265% in the last 2 years from 35 sales YTD in 2019 to 128 sales in 2021. Off-market sales are also very busy, many of which are high-end, private sales, but are hard to calculate, as these are not tracked well.

The Greenwich rental market for single family homes is even hotter than the single-family home market as many people want to “try out” Greenwich and still aren’t certain about how often they will have to go into work.

       Third quarter Greenwich SFH sales and first 9 months

The first nine months of 2021 was an all-time record for Greenwich with 832 sales. The previous 9-month record was only 655 sales in 1999. Since 2021 isn’t over yet, 2020 is still the all-time record holder for annual sales with 863 sales, but 2021 will surpass that as we have 101 contracts waiting to close.

To see how really remarkable the first 9 months of 2021 have been just look at the first 9 months of 2020 where there were only 579 a far cry from the 832 sales in the first 9 months of 2021. (It really the last quarter of 2020 that made it a record setting year. We will have trouble matching it this year unless we get a lot more new listings. As a result, expect to see a bunch of headlines in the fourth quarter about sales being down in Greenwich, when they are still well above our 10-year average.

As to the third quarter itself, in 2021 we had 319 sales with only last year’s third quarter even coming close at 311 sales. Prior to 2020, the previous record was 273 sales a couple of decades ago in 1999. In fact, every quarter in 2021 was the highest sales quarter ever in Greenwich. This led to the first 9 months sales of 2021 breaking the previous record first nine months of 1999 by double digits, 27% higher.

              Sales by Months: The Ups and Downs of 2021

For the month of September 2021, we had 80 sales which is 47% above our 10-year average of 54 sales. However, this year’s sales are down 31% from September 2020 sales of 118 houses, which doesn’t sound good. However, September 2020 was the all-time highest month’s sales of any month until this year. But for, the record sales in September 2020, this September would have been the record for the month of September.

You have to be particularly careful of year-over-year comparisons for the rest of the year as the 4th quarter of 2020 was outstanding, so a drop in sales from last year doesn’t mean that we didn’t have a good sales month. Sales will likely be down from 2021 for October, November and December, but they still may be well above our 10-year average indicating a good to very good month just not a record month.

Factors for the jump in sales include people getting vaccinated and feeling more comfortable looking for houses and the flip side, owners getting vaccinated and being more comfortable with strangers in their house.  WOOFH is also making for much less weekly commuting time. As a result, buyers who might have been daunted by a 10 – 15-hour weekly commute, may find 4 – 6-hours weekly commuting very doable.

Another factor driving our peak sales months in June and July could be expiring 12-month leases that were signed last spring and summer at the height of Covid fear. We also had a huge number of summer rentals in 2020, many of which were extended as tenants didn’t want to go back for the accurately predicted fall and winter infection surge as people spent more time indoors. As these leases expired, many tenants decided that Greenwich was the place for them to buy.

              Contracts, Inventory, and Transactions all dropping and for the same reason

Transactions, which are contracts plus sales, had been trending up for the first half of the year, and then took a sharp jump in the first week in May. Our weekly average in 2021 is 28 transactions per week, but in the first week in May we jumped to 57 transactions followed by 54 transactions the next week. These 111 transactions represent 13.3% of our 832 sales YTD and happened in just those two weeks. Personally, I’ve been calling that period The Frenzy as it was continual showings, contract negotiations and working with inspectors, appraiser, bankers and attorneys to get deals done.

During the Frenzy, we actually saw listings tick up a little bit as April and May were when we saw our most new listings. This is unusual as we normally get lots of new inventory in February and March. This year, many listings were delayed, partly Covid and partly weather related. We also saw owners who had rented their houses to folks getting out of NYC, listing their houses after the one-year lease was up.

The last few weeks have not been good for new listings with a much smaller number of houses coming on than we normally see in our fall market, which starts right after Labor Day. Post Labor Day we got just above 20 listings per week, but with an equal number of houses going to contract, the best we could do was to keep inventory flat.

The problem is that this stabilization is at very low numbers. Just before Labor Day we reached an all-time low in inventory with only 260 listings. Last year in a hot market, we had 477 listings at the beginning of October 2020 and in October 2019 we had 622 listings or 140% more choices for buyers in 2019. Once again when comparing numbers, you have to be careful of the base. We weren’t having a great market in 2019, a more average number would 550 listings for the fall market, but any way you look at it our listings are way down in 2021’s fall market.

The low number of new listings leads to a dropping level of inventory, which leads to reduced sales and that is what we are seeing now. September 2021 sales was a very good month historically, but well down from the all-time high in July of this year. If we had had more inventory, we would have had more sales, the buyers are out there.

Our low inventory and high demand make for some incredibly low months of supply. We have less than 3 months of supply from $600,000 all the way up to $3 million dollars indicating a very tight market, since anything below 6 months of supply is considered a seller’s market. Even more incredible is that we have less than 6 months of supply all the way up to $10 million. These are price ranges that used to be measured in years of supply. Our market continues to be a very hot market, just not as hot as during the Frenzy.

In Greenwich, the heart of the market is from $1 – 4 million and that’s where you see 64% of our sales, 66% of our contracts, but only 52% of our inventory. This market has been strong all year, with the strongest market being from $1 – 1.5 million. I put a house on at $1.3 million in July and we got 6 offers in 3 days, 5 of which were over list price.

 We are also seeing quick sales in all of our price ranges. I had a client that was looking at a house that came on around $2.5 million last Thursday. My clients couldn’t get out to see it until Sunday, when an open house was scheduled. Unfortunately, by Sunday it was gone with multiple bids and a cancelled open house.

The other price range that has done incredibly well this year, particularly, if you look back several years, is our over $5 million dollar market. We have had 128 sale this year, up from 67 sales last year and way up from only 35 sales over $5 million in the first nine months of 2019. Over $5 million, sales have increased 91% over last year and increased by 265% in 2 years.

Our months of supply for our high-end price ranges have also dropped drastically from 2019, when we had 29 months of supply from $5 – 6.5 million and now have an incredibly low 4.7 months of supply. From $6.5 – 10 million we have gone from 34.1 months of supply in 2019 to 5.6 months of supply in 2021. Greenwich is seen as a good place to invest at the high-end.

The Fourth Quarter and Inventory

The key to sales in the fourth quarter is clearly new inventory. Out of the 267 listings that we have on the market, 61 or 23% have been on for last than 30 days. The median days on market is 106 days. Only 67 listing or 25% have been on for more than 6 months, the old standard for when a listing was considered stale.  On the flip side, 167 listings that have been on for more than 6 months have gone to contract or been sold. So being on for awhile doesn’t mean the property won’t sell if the buyer and seller are reasonable.

The bottom line is that three quarters of our inventory is not old, i.e., been on the market for more than 180 days. Of that “old” inventory, more has been sold than is remaining on the market. However, you cut it, our inventory is selling. For the last 6 weeks inventory has stabilized at record low levels of around 265 listings, but it is holding stable, so we are getting listings on at the same rate that they are selling.

The question is how long can this keep up? Stay tuned. We may have a fourth quarter like no one has seen before.