The Real Estate Records in a Record-Breaking Year

by Mark Pruner

  1. Total Sales

This year has been a remarkable year. On October 23, 2021, we passed last year’s all-time sales record of 861. So, every sale thereafter, sets a new record. As of the middle of December, we are at 971 sales within striking distance of a 1,000 single family home sales year. To break 1,000 sales, we only need 29 more sales this month. So far in December, we have had 42 sales and the last two weeks of December are usually the busiest.

2021 Single Family Home Sales in Greenwich, CT

Greenwich real estate attorneys dread the last week of the year. At a time when many employees here in the U.S. take off and many European countries and Canada practically, shutdown, our real estate attorneys are doing back-to-back closings. At the end of October, we looked like we weren’t going to make it, but then sales jumped 30% in November as we got a small spurt of new listings. We need 29 sales to reach 1,000 sales in the next two weeks; it’s looking like we may make it.

2. Highest Sales Price

A. Greenwich

i. Listed on Greenwich MLS

Our highest sale for the year is 100 Field Point Circle which sold for $50,000,000 on December 1st after being on the market for 201 days. It started out at $55,000,000 and hence sold for 90.9% of original list price. It is a special property with 2.46 acres of land with direct waterfront views of the sunrise every morning.

We also had the sale of Tommy Hilfiger’s house for $45 million in backcountry. It sold in only 61 days on the market for 94.7% of its original list price. Next on the list is 23 Smith Road, which sold for $27,750,000 after 627 days on the market. Bill Andruss also here at Compass had a $15,088,000 sale in Belle Haven. This was the second highest sale ever in Belle Haven and the fifth highest out of 971 sales so far.

ii. Private Sales

Non-public sales are notoriously hard to track, but my fellow Compass agent, Shelley Tretter, sold a Conyers Farm property on Lower Cross Road for $19,250,000 which comes in as the fourth highest sale of the year. (If anyone has a higher private sale, please let me know.)

B. The Gold Coast and the Rest of Connecticut

Greenwich is part of the Gold Coast of Connecticut, which is traditionally Darien, New Canaan, and Westport and sometimes Fairfield. This year Fairfield made a bid for permanent inclusion in the CT Gold Coast with the highest non-Greenwich sale in Fairfield County and the whole state. Set on only 1 acre, 1093 Pequot Ave sold for $10,900,000. In Greenwich it would have been our 12th highest sale price.

After the Town of Fairfield, the Gold Coast high sales by town were a $10 million sale in Westport, an $8.2 million sale in Darien and a $7.85 million sale in New Canaan. Stamford was not far behind with a $7.5 million sales.

2021 Connecticut Sales over $7 million (Source: SmartMLS)

The highest sale in Connecticut outside of Fairfield County was in the only town with a mill rate lower than Greenwich’s mill rate, Salisbury, Connecticut, where a 239-acre property sold for $7.4 million. This would place them in 43rd place in Greenwich, of course 239 acres would be a large part of backcountry.

Even within the Gold Coast, Greenwich stands outs for high-end sales.

Highest Sales by Town Outside of Greenwich

3. Lowest House Sale Price in Greenwich

We only had one house sell for less than $500,000 in Greenwich; 15 Highland Place in Pemberwick, which sold for $450,000. The next lowest price was 11.1% higher at an even $500,000 at 196 Byram Road.

Both Byram and Pemberwick are two of our fastest appreciating areas in town. If you are looking to invest and past is prologue, it’s not a bad place to invest. Anybody who bought in pre-Covid is doing well in these areas.

4. Largest and Smallest House Size

In extreme northeast backcountry, 4 Cherry Blossom Lane was listed at 16,802 s.f. and sold for $7,500,000 or $446/s.f. It was followed closely in size by 857 Lake Avenue at 16,775 s.f. This house sold for $9,710,000 or $578/s.f.

Our smallest house sale this year was at 66 Pemberwick Rd, where this 2 bedroom, 1 bath house with 760 s.f. sold for $870,000. It was listed for $800,000 so it went for 109% of list and $1,145 for each of those 760 s.f.  Coming in second was 196 Byram Road, a 960 s.f. house also with 2 bedrooms and 1 bath, that sold for $500,000.

5. Land

After graduation, Russ and I worked in a family business selling oil and gas investments in the deep Anadarko in Oklahoma and the tight sands of the Appalachian basin back in the early ‘80s. Together we bought the smallest lot in Old Greenwich, a 0.09 acre property at 1 Tait Road around the corner from where we grew up at 46 Tomac. This year’s winner for smallest residential lot has 1 Tait Rd beat by 33%. Both 2 Bolling Place in downtown Greenwich and 18 W. William St in Byram came in at 0.06 acres. They sold for $1,094,300 and $750,000 respectively. On a per acre basis, 2 Bolling Place sold for $18.2 million per acre. Trying to build affordable housing near the central Greenwich train station is not a good idea unless you have big government subsidies.

Our largest land sale was up in northwest backcountry at 39 Pierson, where 36.4 acres were sold to a neighbor to be held for open space. It cost them $9,000,000 or just over $247,000/acre. Bill Andruss had the second highest sale land sale also, for $8.875 million in the very private Indian Harbor Association. Those 3.05 acres went for $2.9 million/acre. People really like Long Island Sound waterfront.

6. Shortest Days on Market

Of our 971 house sales so far this year, 71 houses or 7.3% sold in zero days on market, which is deceptive. These 71 sales were private sales that got reported on the Greenwich Multiple Listing Service as “NON-MLS” sales. Having these Non-MLS sales reported is very helpful, when trying to figure out where the market is going. What’s interesting about off-market sales is that there is a concentration at the low end where people are being as frugal as possible and also at the high-end where privacy is a major factor.

Going beyond off market sales, we had 13 listings that were on the market for less than 5 days. This means that a couple of lawyers were working very fast as listings go from “active” to “contingent” or “pending” only occur when a contract is signed, not when the offer is accepted. As you might expect all 13 of these listings went right to pending skipping any mortgage contingency and at that pace, many buyers likely also skipped an inspection.

7. Longest Days on Market

One of the things that you see in a hot market is that houses that have been on for a while, and I mean a long while, find a buyer. Our 2021 record for listing longevity is 9 Conyers Farm Drive which was on for 2,125 days or 5.82 years. It sold for $8.8 million.

You don’t have to be a very high-end house to be on the market for a while. In second place for days on market is 280 Riversville Road which was on for 1,082 days or just short of 3 years on the market. All in all, we had 11 houses sell in 2021 that had been on the market for more than 2 years and 48 houses that had been on the market for more than a year.

Also, those days on market are LADOM, not CDOM. LADOM is “listing agent days on market” and means that one agent listed the property for all that time without any breaks of more than 90 days off market. CDOM, “cumulative days on market”, counts how long the property was on the market whether with different agents or firms without a 90-day break.

For CDOM, the “winner” is 549 North St. which was on for 6.5 years with various agents. On a cumulative days on market basis, we had 57 listings or 5.9% of our sales that took more than a year to sell.

8. Sales Price to Original List Ratio – Best and Worst

Thirty-eight percent, that’s how much the buyer paid over list for a 2,800 s.f., 1931 house in Riverside to set the 2021 record for highest percent sale over list price. As you might expect it went to contract in 8 days.

2021 SFH Sales at full list or over list price

We have had 234 sales out of a total of 971 listings that went for over list price this year, two of which were my listings. We also had another 159 that went for full list price. In total, 40.4% of our listings sold at full list or over.  

At the other end, we had 25 listings that went for less than 75% of their original list price. Of those 25 listings, the median LADOM was 292 days. After 6 months, and in this market, after 3 months, if you don’t reduce to market price quickly, you risk getting caught in a death spiral.

2021 SFH sales at less than 75% of original list price

Today, we only have 194 listings, when we should have twice that number. Of those 194 listings, 41 have been on for more than 292 days and 139 or 72% have been on for more 3 months.

It’s been an amazing year, stay tuned, the one thing you can be sure of is that 2022 will have it’s share of records too.

What Will 2022 Bring for Real Estate?

A third record year, a slump or déjà vu?

by Mark Pruner

               

Where are we now?  

Sales and Listings

To know where Greenwich real estate is going, it helps to know where Greenwich real estate is now. As of the first week of December 2021, we have had 950 single family home sales. The question isn’t however, whether we will break 1000 sales, we have already easily exceeded that number. The reason is that that 20 to 25% of our sales are usually off market and this year we are at the upper end of the range. I, and every other agent with a motivated buyer, are constantly asking other agents whether they have or will be getting a new listing. This year, lots of buyers, have been thanking their agents for “finding them the house, that no one else could find.”

As to public listings sold, we are right now looking at year-end total of 990 sales made on the GMLS, if we have a normal 57 house sales this December. We may, however, break the 1,000 sales mark; It will be close. The demand is there, but what may prevent it is our falling under 200 listings. Right now, we are at 199 house listings on the GMLS and December is a time for sales and not new listings.

950 YTD house sales in Greenwich 11/20 (Note, concentration of sales along the western and northern border with NYS)

                                Contracts

On the contract side, we presently have 109 contracts which is a significant drop from the 121 contracts that we had at the beginning of the month. In total, we have 1071 single family homes sold or under contract so far this year.

                Where are we going in 2022?

The big problem with black Swan events, like Covid, is not only do you not expect them to happen, but when they start to die out it’s equally uncertain what will follow. We don’t know even know whether the increasing positivity rate that we’re seeing primarily from the delta variant will continue to get worse as the cold weather drives people indoors. If you look at the map of where COVID has gotten worse, it corresponds to where we are seeing our coldest weather. Our positivity rate bounces around, but it is going up, not down, as we see more cold weather in Connecticut.

Clearly, 2022 is not going to be a repeat of 2021 and certainly not a repeat of 2020. The pharmaceutical industry is rolling out new vaccines, new treatments and if you haven’t picked up a home testing kit, they are becoming regularly in stock at our local pharmacies. Personally, I think easy, early and ubiquitous testing will cut into the spread Covid significantly as people will know much earlier whether they are contagious or not.

The bottom line is, COVID is going to be COVID and there’s not that much we can do about predicting its effect on the housing market. What is quite clear, however, is that The US economy can do very well with large numbers of people working from home and that large numbers of those people working from home will quit if they are required to go back to 9 to 5, five days a week. Given our labor shortages, companies are going to have to bow to workers desires to spend more time at home.

                WOOFH

As a result, we will continue to see the average house size increase as people need offices and homework areas, so they are not in their bedrooms 14 hours a day. Working occasionally or often from home (“WOOFH”) will mean that where people want to live will change and clearly Greenwich is one of those places that looks better in a post-Covid, WOOFH demanding world. With eight and a half million people in New York City and 22 million people in the metro area, we’re going to see a continuing demand for the larger homes, bigger yards with on-site amenities that Greenwich provides. This bodes very well for the Greenwich real estate market in 2022.

                Whither Inventory?

The biggest impediment to 2022 being another record year in Greenwich is our lack of inventory. This is not a Greenwich problem, but a nationwide problem as people want more single-family homes with yards in the suburbs around major metropolitan areas.

(N.B. We are seeing announcements of a major uptick in sales and rentals in many major cities however, these jumps in transactions are often because they are being compared to the dearth of transactions in 2020, when nothing was going on. When you compare 2021 numbers to 2019 these big jumps in sales and rentals often goes away.)

                                Can our inventory go to zero?

One thing that won’t happen in 2022 is our inventory going to zero. I work with my brother, Russ, here at Compass and he has statistics going back 37 years. The lowest inventory he ever recorded pre-Covid was 290 listings in the last week of 2000. The end of the year is usually when we see our lowest inventory and it’s normally just under 400 listings not the 199 listings that we have now.

The good thing is that real estate always has new listings being generated by lifecycle changes. People have kids, get married, get divorced, downsize, and pass away. This year in Greenwich much of our inventory has come from people who are upsizing driven by COVID and WOOFH. For each one of those families that bought a bigger house, most also sold their old house or their landlord re-rented their place to one of the many first-time homebuyers. Not many people keep two homes in Greenwich.

                                What about zero listings at the low end?

Unlike the overall inventory, It is possible, for our listings for single family homes under $600,000 to go to zero. With our price appreciation, we just don’t see many homes listed under that amount in Greenwich. In 2020, we sold 17 houses under $600K, so far in 2021 we have only sold 8 and only have 2 houses on the market. I expect that next year we will have no houses listed under $600K for many months of the year.

                                Do we have enough high-end inventory?

The greatest surge in sales this year compared to last year is in our $5 to 10 million price bracket. In that price range our sales are up 110% over last year and our inventory is down 35%. Given our very limited availability of waterfront lots, I expect to see a resurgence of new construction in mid-country and backcountry as the demand is there from high-end buyers.

Unfortunately, one of the things that’s driving sales at the high end in addition to COVID and WOOFH is the increase in crime in New York City. Personal safety is something we all will pay to insure but at the higher price levels being free from personal danger is something that people will spend millions of dollars on. You can expect Mayor Eric Adams to move strongly to lower NYC crime rates in 2022.

                Will there be enough money to buy Greenwich houses in 2022?

People talk about the cost of goods going up however an economic professor of mine used to say it is equally valid to talk about the value of money going down. With 6% inflation, the $1 that used to buy 100 cents of goods, now only buys 94 cents worth of goods. Traditionally, one of the hedges against inflation has been to shift money from cash, a depreciating asset, into an appreciating asset such as real estate. In 2022, we are going to hear more pundits talk about inflation driving sales, particularly, at the high end.

We also have lots of people sitting on appreciated company stock and on unspent discretionary savings. Both of these are likely to push Greenwich home sales higher.

                Will rising interest rates kill our market?

The Fed is expected to let interest rates rise in the first half of 2022. This is way overdue. The Fed has been inflating the economy at a time when they don’t need to do so and it’s pushing up the cost of goods for everyone including the cost of Greenwich houses. Once the stimulus payments are no longer occurring and the Fed is not artificially keeping mortgage rates low you can expect some softening in demand.

However, the National Association of Realtors did a study and they found that periods of rising interest rates were also generally periods of rising inflation encouraging people to buy hard assets. An increase in interest rates may slow the increase in demand but it’s unlikely to stop it. In fact, one thing driving our low inventory is our smart money buying houses with very low mortgage rates, before interest rates go up.

A related factor that will push home sales up is that many more people now have enough for a downpayment, since they been staying home saving money. (When was the last time you paid $400 for a ticket to a hot Broadway show?) Also, we are in the midst of the greatest wealth transfer ever from the baby boomers and greatest generation to the millennials and Gen Xers.

For more than a century, Greenwich has attracted well to do people, whose sources of wealth have varied greatly. We’ve also seen wealthy people come from all over the world to buy in Greenwich. Whether motivated by new found riches, such as we saw with the OPEC countries in the 1980’s or problems at home was we have seen with various South American countries, people from around the world come to Greenwich.

                2022

Are we likely to have another 1,000 single family home sales in 2022? Personally, I think that’s unlikely. Are we likely to have a year with sales well above the 600 sales, our dividing line between a good year and a poor year? That I think is likely.

Stay tuned it’s going to be an interesting year, and hopefully not as traumatic as this year.

November 2021 Greenwich Sales Up 30% M-o-M

by Mark Pruner

203-969-7900 – mark.pruner@compass.com

Our market is like a car running on a quarter tank of gas and we are not sure where the next filling station is. Our gas tank/inventory continues to remain very low and in November it gained some net listings at the beginning of the month only to drop a little more by end of the month. Luckily, we seem to have a Herbie, the Love Bug type of market. It doesn’t need a lot of gas to move really fast. Even though our inventory was way down to another record low by the end of November, our sales were up in November 30% compared to the prior month and some of the sales were spectacular.

We had a $50 million sale and a $14.5 million sale both on Field Point Circle. We also had four sales between $5 and $7 million in Riverside in one month. Overall, we had 56 sales, which meant that a quarter of all our inventory at the beginning of the month was sold by the end of the month. (It’s a little more complicated than that, but without regular inventory refills we would be out of inventory in a couple of months.)

Inventory as of 12/1/21InventoryContractsLast Mo. SoldsLast Month Solds+ Contracts YTD Solds YTD+ ContractsMonths of SupplyMoS w/ ContractsLast Mo. MoS Annlzd
< $600K2000882.83.1#DIV/0!
$600-$800K952737422.72.74.5
$800K-$1M71151656671.41.31.4
$1-$1.5M18187251471651.31.42.6
$1.5-$2M21157221271421.81.83.0
$2-$3M302813412312591.41.42.3
$3-$4M29196251361552.32.34.8
$4-$5M21961564733.63.63.5
$5-6.5M2545961654.54.85.0
$6.5-$10M27831154625.55.49.0
> $10M19426121617.414.89.5
          
TOTAL2081215617793310542.52.53.7

For the year, out inventory peaked at 342 single-family-home listings in June. In a normal year, we should have peaked around 700 listings in May. After our June peak, which was really like more like a low hillock, our listings dropped for the next 4 months, down to 229 listings by the last week of October.

November 2021 vs. November 2020

Fortunately, the slide stopped in early November and inventory rose slightly to 243 listings in the first part of November. Increasing inventory meant that for the first time in 4 months, listings were coming on faster than properties were going to contract. By the end of November, the spurt in contracts and sales in November meant that we started the first day of December with only 208 listings.

For the year, the number of outstanding contracts followed the same pattern as inventory. Contracts rose steadily from the beginning of the year and by June we peaked at 263 contracts. After that, the number of outstanding contracts dropped steadily until there were only 101 contracts by the end of September.  This is a fairly typical seasonal pattern, just shifted a month forward. Part of this shifting was the result of the Covid vaccines kicking in March which meant more buyer activity just delayed a month. As a result, contracts peaked in June rather than May as in most years.

 Last month’s uptick in listings led to an immediate increase in sales. In November 2021, we had the aforementioned 56 sales compared to our 10-year average of 43 sales. What’s remarkable is that we are doing this with very low, and often stale, inventory. This late in the year 77% of the inventory has been on the market for more than two months and 20% has been on for more than 9 months. We only have 26 “fresh” listings that have been on for less than a month, which is only 13% of the market. Any properties, under $10 million priced to market, that are in good shape will have a contract in the first two months and probably the first two weeks.

Part of the low inventory is that my brother Russ and I, and I’m sure other brokers, were pausing new listings until after the Thanksgiving holidays. I expect a bunch of new listings this week. If listings stay up, our sales will continue to grow as older listings are generating buyers’ interest. I’ve got a backcountry contemporary that has been on for 6 months and needs updating. The seller has come down in price and we’ve had 5 showings in the past week with one and possibly two offers coming in next week when folks get back from extended Thanksgiving vacations. We still have lots of buyers and if we had more inventory, we’d have lots more sales. Our median sales price is now $2.3M compared to $1.87 million at the end of 2019 or an increase of 23% in two years.

Some folks have argued that people are abandoning the New York metro area. Clearly, folks from Greenwich and NY Metro area are moving to Florida and other warmer climes, but we’ve always had that. Post-recession, the movement from Greenwich to the South slowed as people waited for house prices to recover after the Great Recession. All the owners of this “shadow inventory” have now sold with many moving south, though, not necessarily full time. The downtown condo market, a classic location for Greenwich downsizers and snowbirds is very tight as our Geenwich sellers want a foot in their hometown and their warmer clime.  

I also think a bunch of people have accelerated their retirement and relocation plans because of Covid and listed their houses earlier than they might have without the pandemic. This has been great for our market, as we needed a record amounts of new listings to get a record number of sales. Our 863 sales of single-family homes in 2020 was an all-time annual sales record. That record was eclipsed by October 23rd of this year. Each subsequent sale this year sets a new record. As of December 1 of this year, we are up to 933 sales.

  We had a bunch of high-end sales in November, but we are not done. We have 4 properties under contract that are listed over $10M and 16 contracts for listings over $5M waiting to close.  For successful young families and downsizers looking in the $1 – 4M price range they are finding a fierce market.  Our inventory in that price range is down 105 listings from what was an already low inventory last year. The result is that our sales for November 2021 are down 34 sales from November 2020.

For the year, we are still up in sales for every price range from $800,000 to $10 million, with the glaring exception of $1.5 – 2.0 million. In that price range, our sales have dropped 10 sales from 137 sales in the first 11 months of last year to 127 sales through November this year. Our months of supply for that price range dropped from 2.2 months of supply to only 1.8 months of supply this year. Of course, buyers in that price ranges should be glad that they are not trying to buy a house from $800K – $1M. In that price range you have 7 listings and 1.3 months of supply.

Overall, it’s an interesting time to be in the market. It is one of the few Decembers where we are telling folks that it is a good time to list a house.