State of Real Estate 2016 New Rules

When Michael Cacace started practicing law here thirty-five years ago, “people wondered,” he recalls, “how we were going to get anyone to live downtown.”

That’s not a problem now, of course. Quite the reverse. Customers are rushing into town and leaving backcountry quite alone, creating, dare we say it, some bargains among the magnificence north of the Merritt Parkway.

“Whether it’s young people or graying empty-nesters, they’re more inclined than ever before to desire the urban-type setting.”

It’s a continuation of what might be called the New Urbanization of Fairfield County. Trends and transitions move gradually in our Connecticut neighborhood, but in the last decade some marked changes have come to our streets. It can be seen in all the top-ranked restaurants and stores that have cropped up, and it can surely be seen in the houses desired by today’s Uber-calling, high-tech-house-building young customers.

“Greenwich is now a mini, countrified city,” says Barbara Zaccagnini of Coldwell Banker with a chuckle.

The twenty-first century has already given us two marked epochs in the real-estate game. From 1999 to 2007, there was the heady boom period, of course, enlivened by the presence of ten-day mortgage approvals and the house-flippers who swooped in. From 2008 to 2015, there was a down period followed by recovery, accompanied by the new Dodd-Frank rules. Observers were gratified to see a burst of activity at the end of 2015, which gave heart to sellers even as Wall Street was clearing its throat in the next room.

Now, says Cacace, not alone among the real-estate authorities, another era is upon us. New mortgage regulations landed in our laps last October that make it more important than ever for buyers and sellers to know the new rules.

Indeed, banking laws are only part of the deal now. Before you ever walk into the lawyer’s office with checkbook in hand, it is critical for buyers and sellers to know the latest rules of the real estate game.

But first, a few numbers. Greenwich prices have nearly recovered to 2008 levels, even while that portion of Connecticut outside of Fairfield County might be down as much as 20 percent. The median price in Greenwich was $1.875 million, which is a skosh less than it was in pre-Recession 2007 ($2.175 million).

“In the über-high end, which I’ll characterize as above $10 million,” notes David Haffenreffer of Houlihan Lawrence, “we had fifteen properties sell in 2014. In 2015, we had only five. However, there was an increase in the $8- to $10-million range, so the general thinking was that in 2015 people were guiding just a little lower.”

The desirability of neighborhoods can go through changes. Old Greenwich and Riverside have enjoyed a brisk resurgence lately.

For all pains felt in backcountry, there is one area that seems to never lose its allure. “Waterfront is always going to be where the top sales happen year after year,” says David Ogilvy, who gets honors for the biggest sale of the year, a $26 million waterfront at 79 Harbor Drive in Belle Haven. “It’s a wonderful house, great views. The people looked for a long time and when they saw it, they moved.” Time on market: One week.

Another biggie that sold quickly—through Halstead, although it was not really listed—was a $19 million waterfront on Pilot Rock Lane in Riverside, to Jeffrey Bewkes, the Time Warner CEO.

The heightened activity in Greenwich last year came at the other end of the scale. “In the $1- to $2-million range, we saw nearly a 25 percent jump in unit sales in 2015.”

Last year, 600 homes sold in Greenwich, which is nearly twice the sales witnessed in the dark times of the Recession, but not quite the amount it was in the days of 2007, when 630 homes changed hands.

For all the transitions and mood swings in the market, most Realtors are convinced that the consistently low interest rates will continue to buttress the housing market.


In an earlier era, it was only natural for sellers to want to put a nice, fat price on their treasured house. If the Realtors suggested something lower, well, it was only because they wanted a fast sale, right? In today’s market, that thinking is over.

Realtors now take an utterly sober view about pricing and suggest strongly that you do the same.

“The buyers are very savvy,” says Barbara Zaccagnini. “They have access to all the same information Realtors have. If the house is worth $3 million, and the owner says I want to try $3.5, that’s not going to happen and it’ll end up $2.8 or $2.7.”

Why? Because a house that’s been ignored for a while acquires what might be called an air of desperation. And an overpriced house will be ignored.

Eric Bjork of Berkshire Hathaway knows all about today’s razor-sharp, spreadsheet-toting buyer. “These are folks who are very good at analysis,” he says. “They’re looking at data in their professions and they analyze things to the nth degree. Which is not a bad thing, but sellers have to do the same thing. The days of five or six agents wandering through a house and going, ‘Hmmm, feels like $5 million to me’ are gone. Everything has to be backed up by data.

“The buyers are keeping their emotions in check more than I’ve seen in many, many years. And they really do their homework. We find that our buyers from Manhattan and elsewhere are on the internet a good six to nine months before they even look at a house.”

In this market, sellers should not enter the game thinking they can always lower the price later, says Lesley McElwreath of Sotheby’s International. “Or perhaps they’ll say, ‘I’m only looking for that one buyer!’ I say to them, that one buyer is not going to overpay for your house, even if they like your house. Because they will have done their homework. Every single bit of data is available to every other single person now. They will go on the internet and learn how much every other house sold for, what every other assessment is, how much debt is on the property, whether there are liens.”

She continues, “It’s incredible. The buyers often know more than the sellers about their own home. Buyers will compare property taxes of neighboring houses and inform the seller that the assessment is too high.”

Buyers, of course, are not always holy innocents. The common tactic for buyers is to assume that anyone selling a house must be in some sort of distressed situation and will be grateful to hear any old screaming lowball offer. And why not? If the market is off 20 percent in Milwaukee, it must be down here, too, right?

Thus do negotiations go floundering. The only way to go forward is with as much information as possible. Seller, en garde.


One reason for the decreased traffic at the bigger estates might be a fundamental shift in owners’ expectations these days.

“People are more interested in having a portfolio,” says Lesley. Whereas the goal of any successful family was once the ownership of the biggest possible home, “now they like to have a variety of properties. They’ll buy a primary residence that fills the bill and not much more, then they’ll buy in Vermont or Florida, not to mention Nantucket and the other summer places.” The market sell-off in those regions inspired Greenwich people to go traveling and shopping.

The inclination for travel enjoyed by so many these days, says Rob Johnson of Halstead Property, leads people to desire a house that they can easily shut down for long periods while they move around.


For all the revived popularity of Riverside and Old Greenwich, the biggest shift has been the downtown renaissance. “The trend last year,” says Lesley, “was to build very large single-family homes downtown. It started with the condo market and evolved into a very active single-family home market.”

Condo sales are up 10 percent, says Eric Bjork, boosted in part, he thinks, by Boomers coming around to their urban desires again.

“They like to be closer to one another,” he says “They’re not fans of big property and the costs associated with maintaining it.

“One reason there might be fewer sales in the $8- to $10-million area is that luxury has been redefined.” People who once sought 10,000 to 15,000 square feet are now content with 6,000. “Which is still a big house.” He helped two clients sell big homes in order to move downtown, one to Milbank and the other to Mason. “One client told me that her yearly bill for annuals—plants—was $7,000. She said, ‘You know, my husband and I are done with that. The kids are long gone.’ She could afford it, but it didn’t make sense.”

The recent urge by Greenwich people to steer away from maximum grandness is one that’s been noticed by Roberto Vannucchi of Douglas Elliman, who has eased several clients from large to smaller properties. “It’s a trend toward simplification. ‘Maybe I don’t need 10,000 square feet; maybe I need something with lower rates.’ It’s a continuing trend not just in Greenwich but across Fairfield County and Westchester.

“The rental market is not a huge factor here,” Vannucchi says, “but in Stamford, it’s major. It’s amazing how going one town over can make all the difference in the world.”

Rob Johnson thinks the downtown area is very desirable for where the Boomers are now “and will be for the next ten to fifteen years.”

The success of luxury condos, such as the Harbor near the Delamar Greenwich Harbor Hotel or developments like Arbor Rose, Laurel Ridge and Milbank Court has helped highlight how good a centrally located townhome can be. Branching off from Milbank now are a number of impressively large units occupying relatively small footprints, such as a new 5,400-square-foot home called a “condo alternative” by Berkshire Hathaway’s Harvey Thomas. Like the other new offerings in the neighborhood, it seems to have a tremendous amount of wide-open space inside.

At present there are a number of proposed projects downtown where three houses would be torn down and replaced by an eight- or ten-unit condominium, but there may be a limit to these developments.

“We’re not going to see that many more,” says Lesley McElwreath, “because the density required to build complexes is something the town is trying to restrict if it can.”

If condos are limited, we would still see a rising interest in the new downtown house. Rob Johnson recently spearheaded the building of just such a house on 187 Milbank. Eye-catching on the outside, 5,400 square feet and five bedrooms on the inside, it’s being offered for $4.8 million. So it’s a mid-country size house on a small parcel, and an easy walk to Starbucks. The new ideal.


We all know the house shopper with X-ray eyes. She can look at some shell of a house and see the real Xanadu that exists within. These shoppers are, alas, extremely rare now. Shoppers today see the surface, and that surface better be freshly painted, if not freshly new.

“The vision thing is not easy for a lot of folks,” sighs Bjork.

Remember that Manhattan shopper who’s been canvassing the internet for nine months before alighting at the Greenwich station? That shopper has been taking rigorous house tours on the Realtor’s websites and examining photos and videos with the production values of a Downton Abbey episode.

“Staging has become more important than ever today,” says Haffenreffer. “For buyers today, you have to take any imagination out of the process. You have to show them what this room can be. You don’t want the buyer to have to imagine what the room will be. The message in the back of their brain might be, ‘Ah, let’s go look at the next one.’ But when you show that room looking the way it looks in the shelter magazines, maybe they’ll get it.”

Staging, notes Tamar Lurie of Coldwell Banker, has been a popular practice out West for almost a decade. In the hyperactive Beverly Hills market, for instance, bringing in a decorator for a redo was a natural tactic. But now it has caught on big-time in the Northeast. “It’s seen as an essential,” says Tamar, who knows about moving the big ones.

And we’re not talking a new lamp and throw rug. The total redo might run into the tens of thousands.

“The days of being able to sell a house with three affectionate Labradors lounging in the corner,” says Ogilvy laughing, “and the house hasn’t been painted in ten years—no. Things have to feel new.” And that means interiors designed in the new transitional sensibility.

Anyone who has visited a newly staged house will see right away that decorators are no fan of the comfy ol’ overstuffed Victorian look. Colors will be light and there will be a spacious, airy, contemporary sense to it all. Perhaps one wall will be splashed with some dark color for excitement.

“We’re encouraging our homeowners to make their houses look like that because it seems to attract the youngsters,” says Ogilvy. “And the youngsters have a strong way about them and what they want.”

“Things become obsolete faster,” adds Bjork. “The kitchen is now obsolete in ten years, where it used to be twenty or thirty.”

Bjork saw one client take his $9 million house off the market and submit it to a thorough makeover. Out went the old wallpaper, fixtures and floors; in came the new. “Between the painting and the staging and everything else, I’d say he spent about $40,000.”

But it moved the house.

Sellers should at least be aware of what might be called The Toothbrush Rule. The staging company comes in, hauls in an entirely new set of furniture, completely refurbishes the house and then decrees that not only are your personal effects to be banished, they don’t even want to see your toothbrush on the counter.

That, however, is just about what the buyer wants to bring in. “Buyers today,” notes Haffenreffer, “don’t want to move in with anything but their toothbrush.”


The calamities of the 2008 housing market reverberated for years. Although the subprime-loan scandals were not really a Greenwich problem, we’re still going to deal with the government remedies. The Dodd-Frank Act put limitations on certain customers, most notably those who relied on stated income in the past. But the most recent shock waves landed last October in the shape of new closing requirements called TRID. The intention here was that borrowers get the whole deal laid out and “Know Before You Owe.”

The results have been discomforting for some. TRID officially stands for TILA/RESPA Integrated Disclosure forms. Or, as one banker told Eric Bjork, it might well stand for “The Reason I Drink.”

“It’s become an intense and problematic process,” says real-estate attorney Michael Cacace. “It was supposed to explain to the buyer and the seller where all the monies are going and what the true costs of the ownership are. The fly in the ointment is that all papers must be completed and delivered three days before closing, and if there’s an issue that arises—for instance, some damage during moving—that delays the closing for another three days and creates all sorts of mayhem. The buyer has the movers lined up; the seller needs the money to buy a new house. The ripple effects go on.”

Mandated by the Consumer Financial Protection Bureau, TRID represents, says real estate attorney Robert Sisca, “a paradigm shift of the exchange of information between the lender, the attorney, title company, settlement agent, realtor and the borrower. So it’s not just different documents, but it’s a sea change in how that information is shared with all the parties and ultimately the consumer.”

One Greenwich couple who recently went through a closing found themselves being questioned about their divorces a decade gone. On the other side of the table, legal teams are dealing with banks that seem to have different interpretations of the new disclosure rules.

But it can be managed, says Beckie Hanley of Raveis. Just get everything in order. Visualize before you get to the table. “They’re going to ask you for the backup to the backup to the backup.”

For sellers, this means doing all due diligence at Town Hall. Do you have a certificate of occupancy for that pool you’ve been doing laps in for the last year? You had inspections done on the new wing—but did you get that C.O.?

“These are surprises that cost time and money,” she warns, if it’s not handled ahead of time.

The goal, of course, is to guarantee the safety of people who buy and sell houses.


The Greenwich market has always been boosted by a number of factors that never seem to go away. Westchester citizens frazzled by the tremendous property taxes always come this way to find relief. Young Manhattanites pushing baby strollers always start thinking about beaches and, you know, free schools.

There is a feeling though that young New Yorkers are now delaying the whole kid business, thus delaying that move to the gardens of Greenwich. The sky-high city prices have gone through a correction lately, but it’s only from the stratosphere to the troposphere. Still, the trends in generational shift have people holding on to the city a bit longer.

Real estate observers also know that college debt has become a major American issue. As one man put it, “When my son gets out of law school, he’ll be paying off a loan that’s the equivalent to a home mortgage.”

It wouldn’t be out of step in Greenwich to live one’s life with a hedge-fund outlook, where a subatomic drop in the Indonesian rupiah might lead to headaches in Belgium. More to the point, does it mean a lot to us when Connecticut people migrate to, say, Massachusetts, as some of General Electric’s recently did?

Such transitions lead to a lot of handwringing and paranoia, notes Roberto Vannucchi. But it misses the point. “There’s a lot of talk about what’s going on in our state and country,” he says, “but Greenwich is still a desirable place to live. Whether it’s proximity to the city, our shopping, low property taxes, the phenomenal lifestyle close to the coast, there are a lot of reasons why someone would want to live in Greenwich.”

“We have fifty square miles of town here,” says McElwreath, “and in it we have variety. You can have a doorman apartment here or a wonderful estate in Conyers Farms.”

“What you have here is this beautiful state,” says Ogilvy. “Not just the topographic beauty and the Sound, but there’s no commercial signs in residential areas. That’s big.” He recently had that familiar transition where he sold a house for someone and watched them move to Florida. “Three or four months later, it was, ‘Honey, I am moving back.’ And she bought another house here. People get what it’s all about. It’s an exciting, cosmopolitan place.”

And it’s only going to get more cosmopolitan.



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