High Demand and Low Inventory at All Price Ranges
Two years ago, at this time, the fear of Covid was palpable. Covid was everywhere and we knew little about it. Everyone was wearing masks, and lots of people were wearing gloves, and, if you wanted to show a property, everyone wore booties. Despite this, our overall rentals in 2020 were up only 21% over the pre-Covid year of 2019.
We went from 863 rentals in 2019 to 1,041 rentals in 2020. High-end rentals were a different story; over $12,000 per month rentals were up 233% from 60 rentals to 200 rentals. Above $20,000 per month, our rentals were up 468% from 14 rentals in a normal year to 79 rentals in 2020; and those numbers were certainly an undercount.
As the irrational fear of Covid abated, rentals actually dropped in 2021 to 784 rentals down 25% from 2020 and even 5% below our 10-year pre-Covid average. Our rental market however was a tale of two markets. Below $8,000 rentals were down by 14%. Above that price, rentals were above our 10-year average and often far above that.
Our 10-year average of rentals less than $8,000 per month is 654 rentals, while in 2021, we only rented 561 rentals a drop of 14%. Above $8,000 our 10-year average for rentals is only 142 houses.
April 2022 – Rentals last 12 months
This year we are seeing the number of rentals continue to sink. In the first quarter we had 148 rentals. It seems that many people are hanging on to their rentals and there are fewer people willing to lease their houses. The uncertainty of people’s office situation means they are often staying in place. Having said that over the last 12 months we continue to see rentals throughout the town. They are mostly concentrated in our half acre and smaller zones, but mid-country and backcountry see a fair number of rentals, though not so much this year.
Our inventory has dropped to unheard levels. This week we have only 42 rental listings on the GMLS. At this time last year, we had 91 listings, so we are down by 54%. Go back to a pre-Covid period and we are down even more. Between $6,000 per month and $16,000 per month we only have 6 listings. If you’d like a nice rental in Riverside, you have two choices: one at $14,000/mo and one at $20,000/mo.
April 2022 – Active rentals (green) and expired rentals in prior 12 months
We actually have had more rental listings expire in the last 12 months, 45 listings, than we have in inventory now. Even in this market, it is possible to over price a listing. At least 45 folks thought the market would bear more than it would or were willing to rent at their price and not below.
The pandemic increased sales more than the Great Recession, but only a little bit more. In the recession, sellers, particularly developers couldn’t sell their houses, so they decided to rent. Also, many people who could buy decided not to do so not wanting to buy a declining asset. In 2009, when we hit our low for single family home sales of only 370 houses. That same year, we had 959 rentals.
By 2012, we were back to a “normal” rental market of 780 to 860 rentals per year. In the post-recession years from 2012 to 2019, our rental market was fairly steady within those bounds. Our rental market was also fairly tight with most properties renting in weeks or a couple of months. Our rental market is always tight below $6,000/month where the majority of our rentals are.
In 2020, demand for homes took off as people wanted to get out of NYC. This increase in demand resulted in increased prices, which led to a big jump in inventory, which led to more home rental deals. People who never would have considered renting their houses were happy to do so if they could rent for $30,000 or $50,000. Below $2,000, the number of rentals actually dropped as people who wanted to get out of apartments in NYC were not jumping to move into an apartment in Greenwich.
As inventory started to drop in the second half of 2021, our days on market took a similar drop. New rental listings that came to market were snatched up quickly. Lower inventory resulted in fewer rentals in 2021. The good news is that so far in 2022 our days on market has lengthened a little bit from an amazing 31 days in 2021 in 2021 to 42 days in the first quarter of this year.
We have more rentals each year in Greenwich on the Greenwich Multiple Listing Service than we have house sales, with the exception of last year, when we had more house sales, 1,006, than rentals only 784.
These are not all the rentals in Greenwich. Under $2,000 the majority of listings are done privately; either listed in the newspaper or put on Craigslist. Under this price we have between 100 and 150 rentals per year on the GMLS in a normal year. The units available under $2,000 include everything from a one-room-garage apartments to smaller condos throughout town. If a place is livable in Greenwich and listed for under $2,000/mo. it goes pretty quickly.
Also as noted above, our high-end rentals often didn’t make it to the market for a public listing as they were rented quickly in the hot, high-end market of 2020. So, take all these numbers with a grain of salt. The actual numbers are higher.
What Do You Get?
As mentioned at the lower price points most of our inventory consists of a variety of apartments, condos, garage apartments and the occasional small carriage house. From $4,000 to $6,000 we are about evenly split between single family houses and all other types of rentals. Above $10,000 per month nearly all of our rentals are single family homes. Overall, we normally are about evenly split between single family homes and all other types of rentals. This year 60% of our rentals are single family homes.
It’s a good time to be a landlord and if are a tenant, a good time to have a well-connected Realtor.