The Greenwich housing market has lately been the scene of some enigmatic give-and-take. If you think our market seems a touch flat, well, look in the other direction where it’s a lot worse. Certain lovely towns in Connecticut are down 20 percent. By comparison, the 5 percent lift in Greenwich—the third straight year of gains—makes our town look pretty healthy.
As buyers, sellers and brokers sift through the details to find some recognizable trends, it becomes clear that nothing is boilerplate.
“We in the market, think we understand and are familiar with all that’s happening, but the truth is, it’s changing all the time. And we’re trying to figure out what makes it and what breaks it,” notes Tamar Lurie, broker of big properties via Coldwell Banker Global Luxuries.
The Tax Cut & Jobs Act created a sugar high in early 2018 and then left economists worrying about the deficits. The removal of house-oriented tax deductions brought other worries—but it was more worrisome in Westchester County where property taxes are so much higher. For every seller who departs for Florida, another buyer comes in from frantic New York State.
Thanks to geopolitical traumas, our market saw fewer of those deep-pocketed buyers from Russia, China and Brazil. But, wait. There were actually more from Europe and India.
Our own political scene is also getting some attention. While Realtors are generally very reticent about politics (you’re probably getting mad just reading this paragraph), these days there is a general acknowledgement of the national uneasiness. “It puts uncertainty in people’s minds,” says Vicki D’Agostino of William Raveis. “Hopefully, we can put this all behind us so that more confidence can be restored.”
If the stock market stumbled last year, it did recover. People have taken heart that mortgage rates stayed low, and that helped. Last year’s growth looked sort of wan, and then in January of this year people began storming into their Realtor’s office saying, “Let’s do it.”
What do you need to know about the current real-estate scene? A number of the major authorities gave their advice.
Buzzword of the year: Walkability. “Millennials want what they’ve always wanted—to be close to town,” says Vicki. “They want very low-maintenance places in like-new condition. They want to walk in and not do any work. Shopping is important and particularly the train.”
In this regard, says Coldwell Banker’s Susan Cassidy, boomers and millennials are hunting in the same neighborhoods. “They want the same thing. The in-town locations are desirable for both groups, which means that the larger homes on big properties that don’t have a great walkability score are less desirable.”
The hottest neighborhood in town is Cos Cob. David Haffenreffer of Houlihan Lawrence reports a 25 percent increase in unit sales (84 from 67). The presence of three good schools there now has unquestionably lifted its profile. Riverside also remained solid and Old Greenwich got a 13 percent bump in sales, although with an 11 percent decrease in average price. Pam Pagnani of Sotheby’s International believes that the relative diversity of Cos Cob’s community is also attractive to incoming Manhattanites.
New Yorkers are also ready to accept the million-dollar condo. “The condo and co-op market has been fascinating to watch over the last decade,” says Scott Elwell of Douglas Elliman. “Greenwich is not historically known for this market, but it’s rising. And it dovetails with the spiked interest in having an easy lifestyle. Buyers today want a house that does not need a lot of work, and you move right in. Condos fit right in with that.”
Spec houses are still being built, but not at the pre-2008 rate, says DAvid. “They’re strongly desired by people who love to say, ‘Nobody else has been here before. This is mine.’”
Those #&*% Millennials
Millennials have gotten used to being mocked and scorned. One trait noticed by sellers is the younger generation’s reluctance to make a decision. New buyers are never in a rush. However, it should be remembered that, unlike the boomers and their parents, millennials have never really known that rosy state of guaranteed long-term prosperity and growth. As a result, they take nothing for granted.
“The buyer today,” adds Scott, “has more access to financial information than any buyer in history. They are very confident on how they value a house.” “It’s a buyer’s ball game, they hold all the power,” says Jen Danzi of the Tamar Lurie Group at Coldwell Banker Global Luxury. “They’ve done the virtual tours, they’ve examined the site plans.”
Right now, the two most active groups in the market are downsizing boomers and the group coming of age in the twenty-first century. Millennials have their own approach to life and a big part of that is a comfort with data. And anyone selling a house has to know this.
“In the old days, more people seemed to buy emotionally,” recalls Joann Erb of Halstead. “After seeing three or four houses, people would walk into a house that was pretty, and they’d buy it. They didn’t have as much information. They weren’t as detailed-oriented. Now, they want spreadsheets, comps and everything they can find.”
Realtors are the ones who do battle on behalf of their customers with internet sources like Zillow to get the correct information and the latest photographs up there. Not to mention that customer who arrives quoting a number he spotted. “‘Well, the Zestimate says this’,” Joann sighs. “Well, the Zestimate is garbage. Zillow has no idea if you’ve renovated the house.”
The majority of customers, however, will have done a ton of research.
“Value buyers, they’re there,” says David Haffenreffer. “That’s our conversation with sellers now. Strategic pricing is critical. This is not a market where you fish with a higher price and then lower it.”
Indeed, many longtime homeowners who have not really been part of the real-estate scene for a decade or more will be surprised at the new high-tech options employed by Realtors to find new customers. “Gone are days where you just put it out there and hope,” says Shelly Tretter Lynch of Compass. “Technology is the key now, and people are very quick. People expect things very quickly now, in every business. At Compass we have the tools to reach simultaneously across the country or globally. “I can zero in with the proper technology to people who are looking at a certain price range.”
Says Eric Bjork of Berkshire Hathaway: “Buyers are very patient; they will stay on the sidelines for months as they wait to get the price they want.”
Some have even refined this strategy. “One of our agents had some customers who were only into seeing houses that had been on the market for six months or more,” adds Eric. “They felt that by that time the sellers would be more realistic about price.”
How does a seller deal with such negotiators? “My advice is: Don’t go it alone,” says Eric. “There are a lot of moving parts. It’s not a good idea to negotiate yourself on the price.”
In years past, houses that had been on the market a long time might have earned a dim regard, as if it were somehow tainted. Not so today. “Days on market is not an issue as long as the seller is connected to the market, and as long as I’m seeing a corresponding adjustment of pricing,” says David Haffenreffer, who, like all Realtors, has to counsel realism in the face of grand hopes. “You have to remain nimble to the market.”
Inside the Big House
As Hamptons traffic has become increasingly unbearable, the comparative ease of getting to Greenwich has made it so much more attractive. Realtors hear it all the time. But while sales of the bigger houses have continued, the prices reflect the new sober attitude.
Buyers, after all, aren’t the only ones getting fresh information these days. Sellers know how to examine the comps, too, as David tells us, and once their eyes are opened, they more easily reconcile themselves to reality. “There seems to be more sellers who have gotten religion on what’s the best price,” says Halstead’s Rob Johnson in appreciation of sellers who’ve recognized post-Recession truth.
Nowhere is this more clear than in the grand estates.
Pam Pagnani, who had a hand in many of the bigger sales, points out that if you went back to 2017 and scanned the list of the eight biggest sellers, it would look like this in millions: 25, 22, 21, 20, 19, 13, 13 and 12. Last year there were ten sales of more than $10 million, and went like this: 17.5, 17, 14, 12, 11, 11, 11, 11, 11 and 10.5.
In 2017, those top sales accounted for $146 million in sales. In 2018, that dropped to $127 million.
An instructive story is found in the sale of 207 Byram Shore Road, a magnificent, 12,000-square-foot mansion with a colossal view of the Sound. Movie tycoon Bob Weinstein bought it in 2000 for $16 million and completely redid it. After a divorce it was put on the market in 2013 for $32 million. There it stood, the object of fantasies with a tumbling price tag, until a Westchester family, after a year of circling, bought it last year for $17 million.
Was it simply priced wrong? Tamar Lurie, agent for the sale, looks at the reality. “I was the one who put it on for $32 million, so I take the blame for that. The reason is that I sold a lot nearby—just for the land—for $32 million. So, a great piece of land with that house, thirty-two made sense to me. And then we started reducing.”
Especially in this market. Right now, Tamar has high hopes for the six-acre beachfront house once occupied by Ivana and Donald Trump and now owned by Robert Steinberg. After a $9 million haircut, it is priced at $45 million. It can be subdivided.
Like it or not, the bigger sales in Greenwich have always skewed price averages. The current price reductions of some of the high-upkeep castles continue to raise eyebrows. For instance, the late Leona Helmsley’s palace and forty-acre spread has gone from its $125 million price in the go-go years to today’s $22.5 million.
But now there is a rise in interest from customers who suspect these bargain prices won’t last. “We are at a place where the prices have come down to where it’s realistic to what the market can bear, and buyers are recognizing it,” says Tamar. “That’s why I’m optimistic. If the price feels as low as it could go, then they are comfortable buying.”
Shelly Tretter Lynch senses that more customers see the value of living in backcountry now. “Many people are looking for weekend and summer homes. And backcountry privacy has gotten value again. Property does provide
a buffer of protection.”
“You can get so much value in back country,” points out Jen Danzi. “So now families who thought they wanted to be in Old Greenwich, they see they can get far more land and a bigger house, all for driving just five minutes farther.”
Another group hunting for estates in the $6-8 million range, says Pam Pagnani, is a convivial group: The parents who want their family back home for a visit. “They want their children–and their grandchildren—to have a big family experience. So you have the pool, the tennis courts and all the space you need. If you have the lifestyle, they will come.”
According to David Ogilvy: “There are some real buys to be found in the backcountry.” Some recent sales, such as a $10 million house to a couple who just loved the huge wine cellar and the lake view, have improved the backcountry’s situation. “A rising tide floats all boats,” he says. David has also noted the interest of the still-very-active grandparents, who perhaps leave Greenwich for a spell and then decide to return, looking for a house big enough for their children and grandchildren to hang out and have fun. “I love what these grandparents are doing.”
What makes a desirable house? An open floor plan is always good. An utterly new kitchen helps enormously—and make sure those appliances are the top-name brands.
In matters of aesthetics, sellers often have to be schooled. Sellers of houses are famously blind when it comes to showing off their house and perhaps don’t realize how critical it is to get another pair of eyes to examine their beloved property. Brown furniture, brown siding brown cabinets have to be gone right away, even if it makes the seller feel as if part of themselves is disappearing, too.
“Your home is no longer your home when it’s on the market,” says Eric Bjork. “It’s just merchandise. That applies to color, that applies to clutter. Buyers just want to look at a space and see how it figures for them.” If “your” house now looks like Pottery Barn, well, that will only help the sale.
“When it doesn’t look like yours anymore, that’s when it’s perfect,” says Joann Erb.
The trend with millennials is that they don’t want stuff. If the house is a blank canvas—without stuff all around you—then you can see yourself in it. This mandate is also in force in the grandiloquent backcountry properties, says Jen Danzi. Sheer force of scale will not transcend the effect of old drapes and bygone color schemes.
The drive to paint everything white has been strong for a few years now, but is it actually necessary for every single surface to be blizzard white? Maybe the days of monochrome are ending.
“We hear colors are being used again,” says Joann. “In an older home, the white and gray can give it a modern punch. But in the newer houses, we’re now beginning to see wallpaper and colors make a comeback.”
Then there’s that other, elusive color, green. While everyone wants to be thought of as environmentally concerned, buyers today don’t appear to be insistent on having a “green home,” but eyes do light up at the prospect of a “smart” house, i.e., one connected to the owner’s smartphone.
“We’re helping sellers do this with existing homes,” says Susan Cassidy of Coldwell Banker. “It’s not as difficult as one might think, even if the house was built in 1998. With Alexa and Google and Wi-Fi already present, it’s easier to create a smart home.”
Sellers are increasingly being warned of what might happen in the negotiations. “The whole appraisal process has changed,” says Susan, “and for the better in my opinion. There is less contact with the customer, so the appraiser is more independent. The number will be more accurate.”
Sellers should also be aware that today’s buyers might be strategizing on the final inspection process. The seller just can’t accept a deal and sit back in anticipation of a pleasant transition. The buyer might request a new fence a new barn, even a swimming-pool filter.
“Ten years ago,” says Eric Bjork, “you’d acknowledge that the air-conditioning unit was a certain age and would eventually need replacement, and then you’d move on. But now it’s become, ‘That AC has two years to go, replace it.’ And the seller is thinking, ‘Hey, wait. This is not a new house, this is a reconditioned house.’”
A seller can prepare for eventualities, of course, by getting an inspection early in the process.
From the Grounds Up
There has been a marked upswing in interest in one important tool for building buyer interest—the video presentation. Those sweeping aerials taken with drones were once reserved for the upper-crust houses, but no longer. “Video is huge now,” says Vicki D’Agostino. “We are doing a lot more video photography to capture the vastness of a property so consumers can get a sense of it all. Even if it’s not an expensive piece of land, you want to show how close it is to the town and water.”
To get the best Downton Abbey pictorials, you can’t forget the grounds. “You need to have the landscaping done,” says Shelly Tretter Lynch. “You could have a house that’s not in good shape, but if the landscaping is wonderful, it makes a big difference. It can add real presence to a house.”
Adds David Haffenreffer: “Bad landscaping leads the buyer to feel it’s not quite done yet.”
Indeed, brokers have seen people fall in love with a house just looking from the street. Joann Erb talks about the importance of the streetscape. “When they drive up, if it’s not attractive from the street, it’s already crossed off their list. You need to get them in the front door. Landscaping offers the biggest return on the money.”
No Place Like Home
Immigrants from the city are, of course the foundation of the Greenwich market. Eric Bjork believes that 35 percent of our sales come from Gotham.
But what’s the future? “Manhattan has now had four quarters of negative numbers,” reports Rob Johnson. “It will be interesting to see what happens with that. The city tends to have a more responsive, liquid market, and prices adjust more quickly than in the suburbs. The shift in New York will have a big impact on our market if it continues.”
The big thing in our favor is that Greenwich has evolved tremendously in the last decade. It’s now almost an outer borough of New York—only more tranquil and beautiful. Although some young families are now getting tempted by Brooklyn, Greenwich is not exactly Levittown. As Jen Danzi points out, the diverse population, the high-end retailers in Greenwich, the boutique fitness salons, the restaurants, these all make New Yorkers feel at home.
Tamar Lurie says it best. “A beautiful community like this with the close proximity to Manhattan? What an incredible combination. There is no place on the planet like it.”