100 Greenwich, CT Open Houses on Sunday, April 23, 2017

If you want to see some beautiful trees in bloom, this is your weekend to go see some open houses in Greenwich, CT. We have an amazing 100 open houses on Sunday. The good thing is that we are getting some good new inventory on the market. Right now we have 617 single family homes on the market as recently as the beginning of March we only had 400 listing. With the increased listings we are also seeing increased sales. You can see my March report here.

So get out and enjoy the spring beauty and the many listings that are holding their first open house.

As always if you have any questions feel free to call me at 203-969-7900.

Greenwich, CT Open Houses

You can see the interactive map here.

Address Town Price Saturday
14 Coventry Lane Riverside $15,000 Sun 1-3 PM
636 Riversville Road Greenwich $40,000 Sun 1-3 PM
2 Homestead Lane  #112 Greenwich $379,000 Sun 1-3 PM
169 Putnam Park Greenwich $399,000 Sun 1-3 PM
53 Putnam Park  #53 Greenwich $415,000 Sun 1-3 PM
193 Putnam Park Greenwich $452,500 Sun 1-3 PM
188 Putnam Park Greenwich $465,500 Sun 1-3 PM
40 W Elm Street 5 C Greenwich $499,000 Sun 1-3 PM
47 Nicholas Avenue Greenwich $529,000 Sun 2-4 PM
31 Cary Road Riverside $549,000 Sun 1-3 PM
245 Byram Road Greenwich $549,500 Sun 2-4 PM
47 Nicholas Avenue Greenwich $599,000 Sun 2-4 PM
31 Windy Knolls Greenwich $699,000 Sun 1-3 PM
71 Richland Road  #A Greenwich $699,000 Sun 1-4 PM
45 Francis Lane Greenwich $749,000 Sun 1-3 PM
112 Pemberwick Road Greenwich $779,000 Sun 1-4 PM
1015 North Street Greenwich $819,000 Sun 2-4 PM
82 Silo Circle  #82 Greenwich $839,000 Sun 1-3 PM
25 Valley Road Unit  #25 Cos Cob $849,000 Sun 1-3 PM
49 Grey Rock Drive Greenwich $929,000 Sun 11-1 PM
21 Hoover Road Riverside $935,000 Sun 2-4 PM
40 Cassidy Street Greenwich $945,000 Sun 1-3 PM
25 Indian Harbor Drive  #9 Greenwich $950,000 Sun 1-3 PM
89 Loughlin Avenue Cos Cob $950,000 Sun 1-3 PM
48 Spring Street  #5 Greenwich $985,000 Sun 2-4 PM
12 Georgetowne North  #12 Greenwich $1,184,000 Sun 1-3 PM
44 Valley Road B Cos Cob $1,295,000 Sun 2-4 PM
28 Powell Street Greenwich $1,299,000 Sun 1-3 PM
85 Bowman Drive Greenwich $1,325,000 Sun 1-4 PM
150 Pemberwick Road Greenwich $1,349,000 Sun 1-3 PM
219 Glenville Road Greenwich $1,349,000 Sun 1-4 PM
15 Heusted Drive Old Greenwich $1,349,000 sun 3-5 PM
7 Cherry Valley Road Greenwich $1,395,000 Sun 1-3 PM
61 Hunt Terrace Greenwich $1,475,000 Sun 2-4 PM
66 Valleywood Road Cos Cob $1,495,000 Sun 1-3 PM
16 Idar Court  #A Greenwich $1,499,999 Sun 1-3 PM
20 Sunshine Avenue Riverside $1,549,000 Sun 1-3 PM
12 Laddins Rock Road Old Greenwich $1,549,000 Sun 12-3 PM
3 Nutmeg Drive Greenwich $1,549,500 Sun 12-3 PM
14 Tyler Lane Riverside $1,549,900 Sun 1-3 PM
636 Steamboat Road  #2b Greenwich $1,550,000 Sun 12-4 PM
16 Idar Court  #B Greenwich $1,599,999 Sun 1-3 PM
13 Linwood Avenue Riverside $1,649,000 Sun 1-3 PM
17 Tory Road Riverside $1,749,000 sun 12-2 PM
311 Cognewaugh Road Cos Cob $1,785,000 sun 3-5 PM
112 Patterson Avenue Greenwich $1,795,000 Sun 1-3 PM
1 Finney Knoll Lane Riverside $1,795,000 Sun 1-3 PM
315 Field Point Road Greenwich $1,795,000 Sun 1-4 PM
35 Turner Drive Greenwich $1,795,000 Sun 1-4 PM
17 Oval Avenue Riverside $1,795,000 Sun 2-4 PM
56 Londonderry Drive Greenwich $1,799,000 Sun 1-3 PM
73 Pemberwick Road Greenwich $1,800,000 Sun 2-4 PM
58a Orchard Cos Cob $1,845,000 Sun 12-2:30 PM
570 North Street Greenwich $1,900,000 Sun 1-3 PM
16 Wyngate Road Greenwich $1,995,000 Sun 1-3 PM
116 Pecksland Road Greenwich $2,100,000 Sun 1-4 PM
19 Saint Claire Avenue Old Greenwich $2,199,000 Sun 2-4 PM
38 Jones Park Drive Riverside $2,250,000 Sun 2-4 PM
38 Jones Park Drive Riverside $2,250,000 Sun 2-4 PM
323 Sound Beach Avenue Old Greenwich $2,370,000 Sun 1-3 PM
25 Copper Beech Road Greenwich $2,388,000 Sun 2-4 PM
6 Interlaken Road Greenwich $2,495,000 sun 12-2 PM
15 Hycliff Road Greenwich $2,650,000 Sun 1-4 PM
151 Milbank Avenue  #3 Greenwich $2,650,000 Sun 2-4 PM
31 Chapel Lane Riverside $2,695,000 Sun 1-3 PM
10 Shady Brook Lane Old Greenwich $2,695,000 Sun 2-4 PM
696 Lake Avenue Greenwich $2,695,000 Sun 2-4 PM
20 Dewart Road Greenwich $2,750,000 Sun 1-4 PM
11 Grimes Road Old Greenwich $2,750,000 Sun 11-1 PM
137 Clapboard Ridge Road Greenwich $2,750,000 Sun 12-4 PM
151 Milbank Avenue  #2 Greenwich $2,795,000 Sun 2-4 PM
7 Ricki Beth Lane Old Greenwich $2,850,000 Sun 1-4 PM
151 Milbank Avenue  #4 Greenwich $2,875,000 Sun 2-4 PM
151 Milbank Avenue  #1 Greenwich $2,975,000 Sun 2-4 PM
45 Burying Hill Road Greenwich $2,995,000 Sun 1-3 PM
323 Cognewaugh Road Cos Cob $2,995,000 Sun 2-4 PM
34 Hendrie Avenue Riverside $3,095,000 Sun 2-4 PM
50 Hillcrest Park Road Old Greenwich $3,100,000 Sun 11-1 PM
9 Game Cock Road Greenwich $3,199,000 Sun 2-4 PM
43 Grahampton Lane Greenwich $3,250,000 Sun 1-4 PM
14 Sherwood Farm Lane Greenwich $3,395,000 Sun 1-4 PM
99 Hunting Ridge Road Greenwich $3,395,000 Sun 10-1:30 PM
106 Lockwood Road Riverside $3,795,000 Sun 1-4 PM
9 Roberta Lane Greenwich $3,895,000 sun 12-2 PM
54 Mallard Drive Greenwich $3,925,000 Sun 1-4 PM
14 Coventry Lane Riverside $3,995,000 Sun 1-3 PM
82 Cat Rock Road Cos Cob $3,995,000 Sun 1-4 PM
20 Alpine Road Greenwich $3,995,000 Sun 2-4 PM
61 Winding Lane Greenwich $4,200,000 Sun 1-3 PM
4 Jones Park Drive Riverside $4,295,000 Sun 1-3 PM
79 Pecksland Road Greenwich $4,497,500 Sun 1-3 PM
636 Riversville Road Greenwich $4,595,000 Sun 1-3 PM
5 Indian Head Road Riverside $5,350,000 sun 12-2 PM
34 Club Road Riverside $5,495,000 Sun 1-3 PM
35 West Way  Old Greenwich $5,495,000 Sun 1-4 PM
38 Dairy Road Greenwich $5,495,000 Sun 12:30-3:30 PM
33 Vineyard Lane Greenwich $7,395,000 sun 2:30-4:30 PM
11 Cove Road Old Greenwich $7,995,000 Sun 1-3 PM

The Anti-Greenwich Tax Bill

A bill has been introduced in the Connecticut legislature which, if it is passed, will do great damage to the Greenwich housing market in a wide variety of price ranges. HB No. 7313 proposes to put a 19% surcharge on “income derived from investment management services”. This bill proposes to raise the Connecticut income tax to make up for the so-called carried interest revenue difference. Many investment management funds are set up so that the managers’ payments are taxed as capital gains.  The capital gains tax rate is 20% at the federal level and the maximum federal income tax rate is 39.6%. The idea behind the Connecticut tax is to tax investment managers for nearly the full difference between these two federal tax rates and have all the taxes go to Connecticut.

The authors of this bill realize that such a tax could encourage Connecticut investment managers to relocate to New York. So, the tax bill has a curious provision which provides that the 19% surcharge shall only be applicable in tax years where New Jersey, New York and Massachusetts have enacted substantially similar laws. The thinking seems to be that if the whole region is taxing investment managers at this rate then there won’t be an incentive to move between the states within the region. It’s not clear how this will prevent a move to Florida.

Now given this curious multi-state provision, some may see the proposed bill as a tempest in teapot. The problem with this bill is that it is only the worst of many efforts that have been made in the last few years to tax our wealthiest residents to make up for significant budget shortfalls.

Year Total Sales Total $ Difference
2003 45 $315,003,775
2004 73 $594,889,596 $279,885,821
2005 84 $674,754,878 $79,865,282
2006 85 $642,652,350 -$32,102,528
2007 113 $904,030,500 $261,378,150
2008 53 $467,504,500 -$436,526,000
2009 43 $383,193,112 -$84,311,388
2010 43 $417,500,875 $34,307,763
2011 52 $434,116,771 $16,615,896
2012 70 $542,890,550 $108,773,779
2013 53 $422,155,000 -$120,735,550
2014 72 $666,770,298 $244,615,298
2015 60 $465,171,045 -$201,599,253
2016 35 $267,660,990 -$197,510,055
Grand Total 881 $7,198,294,240

 

The idea of many legislators is that the wealthy residents can afford it and that ratcheting up the high-end tax rate percentage will result in the same percentage increase in tax revenues. While that is true up to a point it appears that point was passed sometime around 2014 when high net worth taxpayers starting to vote with their feet.

Over $5 million dollars sales in Greenwich 2003 - 2016

Over $5 million dollars sales in Greenwich 2003 – 2016

In 2014, we had 72 sales over $5 million, which was the largest number of sales since the pre-recession boom year of 2007. In that year, those 72 home sales generated $666,770,298 in sales revenue. The following year, however, sales dropped to 60 houses and $465,171,045. In 2016, we had only 35 sales over $5 million which totaled $267,660,990. The total revenue drop in those two years was just shy of $400,000,000.

The direct consequence of the reduced sales is a significant loss of property conveyance tax for both the Town of Greenwich and the State of Connecticut. However, these are minor taxes compared to the huge amount of lost personal income tax that the reduced sales to high income individuals represents. You also have lost sales tax and fewer local charitable contributions.

Several of our wealthiest homeowners are no longer Connecticut citizens. Most of the people in these income levels who can afford high-end homes in Connecticut have more than one home and often two or three. For these folks who spend more than six months in another state, Florida is popular given that it has no income tax, to eliminate their Connecticut tax burden.

It’s not quite that simple as it is a multi-factor test as to what state gets to tax you as a resident. At one point the DRS was looking at whether investment managers were still making contributions to local charities as a factor to determine if the manager was still a Connecticut resident. As a result, people were encouraged by their accountants to stop giving to local Connecticut charities. Luckily, the Connecticut legislature got the DRS to reverse their position (see DRS PS 2106-3).

And, while the focus is on the very highest earners, there are hundreds of mid-level managers and traders who make good salaries who are not headline worthy. If firms continue to move out of state, we lose many of these folks. All of the suppliers of these companies, the people doing renovations and even the local grocer get a lot of business from these companies and their employees.

You would think that the state would be trying to grow the pie rather than taking a bigger piece of a shrinking pie. It’s an industry of highly educated, high earning people who don’t overly tax the state’s infrastructure and don’t cause pollution problems. The problem is that Connecticut is two very different states. In Greenwich, our median home price is around $1.6 million, while for the state as a whole, the median home price is around $240,000 or 15% of prices here and that is the median price, meaning half of the homes sell for less than that amount.

Connecticut has a lot of citizens with real needs, but raising taxes has become a negative sum game. If you’d like to do something, write to Greenwich’s Senator Frantz or Representatives Floren, Camillo and Bocchino. They understand these issues well, but they need real life experiences and clear opposition to this method of solving the state’s budget problems.

We need to turn Connecticut back into a state that attracts the top investment managers and companies as it has done for the last three decades. It is a good solution for everyone.

March 2017 Greenwich Real Estate Report

  • Sales take big jump in March up 60% over last March
  • $1 – 1.5M and $2 -3M are busiest segments
  • Contracts down slightly as many sales close in March

March 2017 was a good month for sales with sales up 58% over last year. We had 52 single family home sales in March which was up by 23 sales over March 2017. Sales were concentrated from $1 – 3 million with 30 of the 52 sales falling in that range.  Our contracts were down slightly from 93 at this time last year to 83 this year, but this is to be expected when you have so many sales.

March Sales, Inventory, Contracts & Months of Supply

04/01/17 Inventory Contracts Last Mo. Solds Tot. Solds+ Contracts  YTD Solds  YTD+ Contracts Mos Supply Mos w/ Contracts Last Mo. Annlzd
< $600K 4 3 2 5 4 7 3.0 2.6 2.0
$600-$800K 11 12 6 18 8 20 4.1 2.5 1.8
$800K-$1M 18 6 2 8 7 13 7.7 6.2 9.0
$1-$1.5M 50 12 12 24 32 44 4.7 5.1 4.2
$1.5-$2M 72 10 7 17 17 27 12.7 12.0 10.3
$2-$3M 111 17 11 28 28 45 11.9 11.1 10.1
$3-$4M 83 15 3 18 12 27 20.8 13.8 27.7
$4-$5M 61 2 2 4 5 7 36.6 39.2 30.5
$5-6.5M 61 4 4 8 8 12 22.9 22.9 15.3
$6.5-$10M 59 2 2 4 2 4 88.5 66.4 29.5
> $10M 37 0 1 1 2 2 55.5 83.3 37.0
                   
TOTAL 567 83 52 135 125 208 13.6 12.3 10.9

Our inventory was also down slightly from last year with 567 house listing, but this was a very nice rise from February when we only had 475 listing. We have 33 listings under $1 million with most of these on the west side of town, which makes for very tight supply. Under $800,000 we only have 15 listings and when you annualize the sales we had in March we have less than a 2 month supply of inventory.

Sales.SFH.2015-Mar2017.040517

March 2017 vs. March 2016

17 vs ’16 Inventory Contracts Mo. Solds Tot. Solds+ Contracts  YTD Solds  YTD+ Contracts Mos Supply Mos w/ Contracts Mo. Annlzd
< $600K 1 1 2 3 0 1 0.75 0.32  –
$600-$800K -4 6 4 10 -3 3 0.03 -1.50 -5.67
$800K-$1M -2 0 -1 -1 -4 -4 2.26 0.94 2.33
$1-$1.5M -3 -2 5 3 13 11 -3.68 -2.11 -3.40
$1.5-$2M -2 -6 1 -5 0 -6 -0.35 1.91 -2.05
$2-$3M 14 -7 8 1 16 9 -12.36 -1.03 -22.24
$3-$4M -11 3 -1 2 1 4 -4.89 -4.56 4.17
$4-$5M 9 -3 0 -3 1 -2 -2.40 13.21 4.50
$5-6.5M -8 -1 4 3 4 3 -28.88 -11.63  –
$6.5-$10M 5 1 1 2 -1 0 34.50 5.63 -24.50
> $10M -9 -2 0 -2 0 -2 -13.50 31.50 -9.00
 
TOTAL -10 -10 23 13 27 17 -4.06 -1.33 -8.99
Pro-Seller Pro-Buyer

Overall March was good news for sellers with sales up, inventory down a little and months of supply down significantly from last March. When you look at the individual price ranges and neighborhoods there is a much more nuanced story to tell.  For example, from $4 – 5 million our inventory was up 9 listings, contracts were down 3 and sales were flat. Sales are also not evenly distributed throughout the town.

The dramatic jump in March sales follows just average sales in February and is more in line with our traditional average with low sales in February bracketed by a good January and March, which was not the case in 2015 and 2016. January often has good sales as people want to move their capital gains into the next year to put off paying taxes to the following year.

March also traditionally has had a rebound as the financial community spends their year-end bonuses. As more bonuses are given in stock and deferred compensation this spring bump up has been smaller and we see the same thing this year. We did have four March sales between $5 and 6.5 million, but we didn’t see a similar jump over $6.5 million where we have 96 houses in inventory and only four sales YTD.

The sales from $1 – 1.5 million really stand out with 32 sales so far this year. We have 28 sales from $2 – 3 million which is good, but we have more than double the inventory with 111 houses on the market compared to 50 houses from $1 – 1.5 million. Now the good news is that we have 32 contracts between $2 and $4 million so this segment will continue to do well.

Mar2017.Sales.Inv.Cur.Ks.040217

When you look at months of supply our under $800K market is remarkably tight and when you look at contracts it is only likely to get tighter unless we have a big influx of inventory which is unlikely. Inventory coming on lead sales at this time of year so you can expect that months of supply will stay up for price ranges above $3 million.

Mar2017.MoS.040217

The good sales from $5 – 6.5 million make that price category a stand-out in the high-end market. We have had 8 sales and with 4 contracts this price range has kept pace with the inventory coming on the market. This is the only high-end price range with less than 2 years of supply.

When you look at the market in segments our market under $1 million is 6% of our inventory, but 14% of our sales and would be higher if we had more inventory. Houses in this price range that don’t go to contract in less than 60 days usually have some issue or another that is slowing their sale.

Mar2017.4Pie.040517

In our mid-market from $1 – 3 million our inventory is 41% of our market and our sales are 62% of sales. Above $4 million we have 53% our inventory, but only 24% of our sales. One promising area is the contracts from $3 – 4 million where we have 15 contract waiting to close so we should see a good April for this price range.

So, over all the first quarter is looking good. Sales YTD are up 13 sales from 2016 to 135 sales. We have a good number of contracts and we are finally getting the fresh inventory we need.

High-End Open Houses: Buyers are busy, but then so are sellers. Last weekend we had over 100 open houses or almost one out of every five listings on the market were open to the public. One reason we had so many open houses is that we are seeing open houses at the high-end. Of the hundred plus open houses last weekend, sixteen were over $4 million dollars.

Owners often fear that a bunch of unqualified, house voyeurs will show up to gawk, but this very rarely happens. What’s interesting is how self-selecting the people who come to these open houses are. To the extent an agent can ever know, these open house attendees look and sound qualified. High-end open houses get only a handful of open house attendees, but they are often worth doing and they do not open the flood gates to hordes of people. As a result, open houses are becoming a useful tool to market these homes.

Getting your house ready for showing – Repairs & Renovations

There are a surprising number of people in Greenwich that are embarrassed about their upstairs bathroom. I’ve had clients who don’t want to list their house until the bathroom has been fully renovated and is at least as nice as the powder room for guests on the first floor. They just don’t want other people, and particularly the neighbors, seeing how bad that bathroom is.

Now a truly disgusting bathroom, what I call a bad memory point, really needs to be fixed before listing. Often though the bathroom is just old and worn. The issue then becomes what to do. What you don’t want to do is to do the cheapest job that you can.  The result is a bathroom where the material and the workmanship don’t match up with the rest of the house. The buyer will usually look at the bathroom as a complete renovation just as they did before the owner paid for the work, since the buyer will rip out all of the work that was just done. They will then then replaces it with the style and quality of material that they want and that fits in with the rest of the house.

So what should you do? Well the first thing to do is to get rid of as much clutter as possible. Have a yard sale or even two sales, give away a lot of stuff to the kids, throw away everything you are not going to move, and box up the rest and put it in neat order in the attic, basement or garage.

Once you’ve gotten rid of as much stuff as you, can hire a professional to clean the whole house. One area that is vital, but often overlooked are cleaning the windows inside and out. Nothing will brighten up a house and show off the yard like crystal-clear windows. Also if you have any pet, cooking or smoking odors get a specialist to eliminate these odors.

Repair or replace anything that is broken or missing; such as missing bathroom tiles, bricks without mortar, cracks in walls and potholes in driveways. Two things that you can do that can make your house standout from the competition is to paint the walls and refinish the floors, particular those rooms near the front door.  (I’ll leave staging, which I recommend, to another article.)

As to determining what renovations you should do before putting your house on the market, the short answer is it varies greatly from house to house. Curiously, renovations are most helpful for houses at the high-end and low-end of the market and can be the deciding factor as to whether a buyer makes an offer or not.

At the high-end we have lots of beautiful houses, so anything that looks old and worn is going to be at a major competitive disadvantage. Certainly, repair anything that is broken, but you might want to consider a new kitchen or new master bath if they are badly out of date. If you are planning on staying in the house should it not sale, there’s no reason not to do these renovations since you can enjoy them yourself and they may just be what gets you an offer.

Under $800,000 renovations can also be offer determinative, because these are costs that a first time buyer or downsizer won’t have to pay. So once again the renovation may be outcome determinative. Between $2 million and $4 million the question of renovation is more complicated as most of the buyers will be able able to pay for or finance the renovations that they want to do. Buyers at these price points are also more particular about style so a significant renovation might actually make the pool of buyers smaller as the renovations are not be to the taste of a particular buyer.

I often work with an architect or a contractor in discussing what work might make for the quickest and highest sale. If your house isn’t selling, taking the team approach as to what renovations would make it more saleable can be very useful. Recently, a house in Cos Cob that hadn’t sold and was rented came back on with a newly finished basement. It was a big plus.

Getting multiple ideas from a couple contractors can be a big help in selling your home for the best price.

The 2017 Condo Market in Greenwich, CT

From a real estate view Greenwich is really more like a small city than a town. We have a variety of different types of housing from large single-family homes that everybody reads about in the national press to studio apartments for rent. As a result, we have something for just about everybody.

The Condo Market: One area that doesn’t always get a lot of attention is our condominium market. Right now, we have 89 condos and 17 co-ops listed for sale in Greenwich. This compares to 540 single family homes. These condos vary in price from $349,000 to $4.9 million. Our median price condo (including the co-ops) listing is $1.25 million. Most of our condominiums are located within a half mile of the Post Road with a major concentration in central Greenwich.

On the sales side we have sold 35 condos so far this year and we have 30 condos under contract. Under $1 million we have 48 condos for sale and 33 sales so far this year. It is a hot market. We only have 3.7 months of supply under $1 million. This means that if no more inventory work to come on the market at the present sales rate we would be out of condominiums by the middle of July.

Above $1 million we have a different market. We have 58 condominiums for sale and so far this year we’ve sold 10. This works out to about one year of supply. The same resistance is seen in the single family home market except instead of at $1 million as it is with the condominium market it is at the $1.5 million level.

Over $4 million months of supply for single-family homes take another jump up to over 2 years supply, but we don’t see this in the condominium market because there is practically no supply of condominiums above $3 million.

Condos come in a lot of different flavors. You have apartment style condominiums like 40 W. Elm St. in downtown Greenwich and you also have townhouse condominiums like at the Commons on the Post Road in Old Greenwich. You even have free standing houses like those at Lyon Farm, which are also condominiums due to the way the land is owned.

When buying a condominium, you need to be more careful to find out just what it is that you are buying into. Many condominium deeds only transfer the interior spaces to the buyer sometimes described as ownership from wallpaper to wallpaper. The structure itself as well as the driveways, roads and other common elements are jointly owned by all association members. Also the items that the buyers is getting may not be in the unit. Things such as parking spaces and storage units may be a good distance from the unit.

One thing that sellers may not know is that under the Connecticut Common Interest Ownership Act the buyer has a five day right of rescission until they are given the condominium resale certificate which includes rules, regulations and a balance sheet. So anyone selling a condominium should put in a phone call to the person who prepares the resale certificate and let them know that the request may be coming in soon. For this right of rescission to apply the association needs 13 or more lots, so buyers in associations with a small number of units don’t have this right though you still should take a look at the documents.

If you are a buyer you want to read over the documents to make sure there are adequate reserves and also to see what rules apply. Pet policies in particular may be a surprise to some prospective buyers who may or may not want pets.

Co-ops: While the structures themselves may look very similar to a condo, co-ops are an older and very different ownership model. When you buy a co-op you’re not buying a fee simple in land or more appropriately air space, you’re buying shares of stock in a corporation. Each set of shares is assigned to a particular unit and gives you the right to occupy that unit.

In a co-op, the individual shareholders don’t pay taxes. The corporation itself pays taxes since it’s the owner of all of the land and buildings. One of the issues with that is that you can’t go down to the tax assessors office and pull the field card for a particular unit, since there is only one field card for the entire property. As such, things that might normally be easy to find out such as the square footage of a particular unit or prior owners can be more difficult to ascertain.

Another unique thing about co-ops is their boards can decide whether or not a co-op owner/buyer can do the transaction. While we don’t have the epic struggles to get into a co-op as you hear about in New York City, the boards often meet with the prospective buyer and some co-ops want to see your balance sheet and references before they will let you in. Co-op financing in Connecticut may also be difficult since they’re only a couple of banks that will make loans on co-ops in Connecticut. For all these reasons condos are more populus here in Greenwich.

Overall condos and co-ops provide the right type of housing for a variety of people and different life stages. Our market is busy, so if you don’t see what you like now, it may get listed next month.

 

Buyer’s Guide to Winning Multiple Offer Bidding

So far this year, we have had 180 single family homes go to contract or closed. Of those 180 transactions about one-sixth have either sold for list price or more or been on the market for less than a month. Now you would think that these properties were our lower priced properties, but the price distribution matches our sales distribution fairly well. Eight of the 29 properties were priced less than $1M, 13 were from $1 – 2M and eight of the properties were priced over $2M. So a well-priced, desirable property can sell quickly at any price.

1st Quarter Over List and Quick Sales

So how does a buyer get an advantage in competitive bidding situations or a tight market? The short answer is to be better prepared than your competition and then use that preparation to move quickly.

Build a Team Early

Everyone knows to get a good Realtor when they buy a house, but you will need other professionals too. If you are going to need financing talk to a mortgage broker or banker early. Meet with them and build a relationship. Very few financings are pro forma today.

Most buyers don’t think about a real estate attorney until after their offer has been accepted. Be prepared and find your attorney early. Let him or her know your level of experience and that you’ll probably need a quick turn around on the contract rider.

Building inspectors can also be a big help. Once again, speed can be crucial. In a competitive bidding situation you may only have a day or two to inspect the property. The only thing worse than coming in second in a bidding war is winning it and getting a house with problems.

The top capital gains tax has increased and there is an additional 3.8% Medicare tax on gains. The rules are complex, but if you have a significant gain in your present house, you may face a bigger tax bite this year. If you are selling your own house and you need the funds from that house to close consult a tax attorney or accountant to see just how much the taxman taketh and ways to minimize the take.

Finally, houses come and go, so don’t let planning get in the way of the house that just came on that may not be there by the time you do your preparation.. If you see a house come on that you might like go see it and if you like it make a bid. You don’t want to have paralysis by analysis. So while you are preparing keep your eyes open for the right house for you and don’t wait if you see something that looks good.

What follows below is a set of tactics that can give you the most advantage in negotiating in a multiple offer situation.

Tactics

First relax you’ve got a team of advisors if things get difficult. You’re better prepared than most of your competition.

Second, have your mortgage broker or banker pull your credit and check for any problems. Get not only pre-qualified, but pre-approved. A pre-approval letter and shorter mortgage contingency goes a long way when bidding against someone without one. Also now’s a good time to fix your credit score rather than when your loan hangs on getting a higher rating.

If there is some way you can do all cash great. An all cash offer in a competitive bid situation can move you to the top of the list and often reduce your purchase price by $10,000 to $20,000 for deals under $1,000,000 and by as much as $50,000 for deals under $2,000,000. Consult with your team before you do this. Refinancing later can be tricky and may affect your taxes.

Third, be available. If one of you can’t always take phone calls, what about email or texts? Whenever possible whoever is most available should be able to make decisions for both. Discuss various options in advance so you are both comfortable with this.

Fourth, be flexible and reasonable. Don’t let a minor deal point or few dollars become an ego issue. Work with your team to come up with other options, particularly when the other side is being unreasonable. Don’t yell and scream. The seller has lived in your house-to-be for years and knows all your new neighbors. You want to arrive in their good graces.

Fifth, be human. Let the seller know why you like their place and what it will mean to you and your family to live there. Also try to connect with each person you deal with; don’t become just another case number.

Lastly, have fun. How often will you get to do this? With a good team you’ve got people to talk with. Even if you lose out the first time around you will have gained valuable experience. You will get a house and often a better house at a better price.

February 2017 Greenwich Real Estate Report

Inventory Down, Contracts Up & $2 – 4M Looking Good

By Mark Pruner

Douglas Elliman – Greenwich

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

  • Contracts up 32% year over year with spike from $2 -4 million
  • Heavy activity as buyers rush to do deals before interest rates rise
  • High-end market gets off to a good start

January 2017 was an okay month for sales in Greenwich, but an excellent month for contracts.  Our contracts as of the end of this February were up 21 over February 2016 jumping from 65 contracts last year to 86 contacts this year. More than half of this increase in contracts was in the price range from $2 – 4 million where contracts up by an even dozen.

February Sales, Inventory, Contracts & Months of Supply

Inventory Contracts Last Mo. Solds Tot. Solds+ Contracts  YTD Solds  YTD+ Contracts Mos Supply Mos w/ Contracts Last Mo. Annlzd
< $600K 3 4 1 5 2 6 3.0 1.8 3.0
$600-$800K 15 8 2 10 2 10 15.0 5.3 7.5
$800K-$1M 12 6 1 7 5 11 4.8 3.8 12.0
$1-$1.5M 36 14 8 22 20 34 3.6 3.7 4.5
$1.5-$2M 57 11 2 13 10 21 11.4 9.5 28.5
$2-$3M 90 18 8 26 15 33 12.0 9.5 11.3
$3-$4M 67 13 3 16 9 22 14.9 10.7 22.3
$4-$5M 53 4 1 5 3 7 35.3 26.5 53.0
$5-6.5M 55 3 3 6 4 7 27.5 27.5 18.3
$6.5-$10M 53 4 0 4 0 4 46.4
> $10M 34 1 0 1 1 2 68.0 59.5
                 
TOTAL 475 86 29 115 71 157 13.4 10.6 16.4

Our inventory was down significantly from last year with only 475 listings down from 493 listings last February. Of this drop of 18 listings, 16 were between $800K and $2M. Our sales and contracts are about the same in this price range, so the drop in inventory was the main factor in significantly lower months of supply from $800K – $2M. From $1 – 1.5M we have a remarkably low 3.6 month of supply.

feb2017-mos-030217

 

February 2017 vs. February 2016

2/17 vs. 2/16 Inventory Contracts Mo. Solds Tot. Solds+ Contracts  YTD Solds  YTD+ Contracts Mos Supply Mos w/ Contracts Mo. Annlzd
< $600K 1 2 -2 0 -2 0 2.0 0.6 2.3
$600-$800K 2 3 -1 2 -6 -3 11.75 1.8 3.2
$800K-$1M -5 1 -2 -1 -2 -1 -0.1 -1.1 6.3
$1-$1.5M -4 0 -1 -1 9 9 -3.7 -1.9 0.1
$1.5-$2M -7 1 -4 -3 0 1 -1.4 -1.7 17.8
$2-$3M 3 6 4 10 7 13 -9.8 -5.7 -10.5
$3-$4M -5 6 -2 4 2 8 -5.7 -7.3 7.9
$4-$5M 2 2 -1 1 1 3 -15.7 -18.1 27.5
$5-6.5M 3 -2 2 0 1 -1 -7.2 4.8 -33.7
$6.5-$10M 4 2 0 2 -2 0 3.5
> $10M -12 0 -1 -1 0 0 -24.0 -21.0
TOTAL -18 21 -8 13 8 29 -2.3 -2.9 3.1

When you look at contracts in all price ranges, the other area that jumps out at you is the $2-4 million price range where we are up 12 contracts from last year and our closed sales are up 9 houses from last year. In this $2 – 4 million price range we have 21 contracts in the queue. As these sales close over the next two months we will continue to see good sales in this price range.

feb2017-sales-inv-cur-ks-030217

Now overall, February sales were down 8 houses from last year, but this is not overly worrisome as February 2016 was a record month for February sales. Our 10-year average for February is 30.9 single family home sales so 29 is not far off the average. The drop in sales from 2016 is fairly evenly distributed across the price ranges. We also had a good January so we are still up for the year in sales.

sales-sfh-2015-dect2017-030517

We may even be seeing a bit of a supply constraint in sales, since the small drop of sales in most price ranges roughly corresponds with the drop in inventory in those same price ranges. Two other positive indicators, albeit purely anecdotal, are a good numbers of showings and significantly higher open house attendance.

If you look at just the inventory compared to the first two months of sales it looks like we have plenty of inventory, but that’s not the case from many buyers’ viewpoint. By the time they pick a price range, a neighborhood, a housing condition and a style of house there may be only a handful of houses that fit their desires. As a result, houses that have been on the market for a good period are selling.

February 2017 Pie Charts - Inventory, Sales YTD, February Sales and ContractsActivity over $4 million is doing well with 20 sales or contracts so far this year. We had one sale for $19,250,000 and a contract of a house listed at $17,500,00.

Old inventory is also being absorbed. A third of our 158 sales and contracts in 2017 were for houses that have been on the market for more than 8 months. We even had 22 sales that were on for more than a year. The record holder so far for 2017 was a house that had been on and off the market since 2010 and sold in January after 1,233 cumulative days on the market.

For buyers being prepared with information and financing is key. We have inventory coming on every day in the Greenwich spring real estate market, albeit a little slower than last year, but it is going to contract faster than last year, so email alerts of new listings are crucial.

I used to set up alerts to go to clients 2 – 3 times per week, now I set them up so they get new listings within 5 minutes of them going on the Greenwich MLS. The sooner the buyer has an accepted offer in hand the fewer competitors they have, since most buyers won’t go see a listing with an accepted offer. In Greenwich, however an accepted offer doesn’t mean the buyers can relax. The rule here is that the deal is not binding until the contract is signed. Buyers need to have their inspectors, bankers and attorneys lined up before the offer is accepted not after. In a busy market, like this, they need to cut every day possible off of the time period from accepted offer to signed contract.

If the market follows the Dow as it has been doing this could be a very interesting year for buyers and sellers.