Monthly Archives: June 2006

Birds of Prey
When John Augustin, proprietor of Augustin Farm up on King Street, lost his leg in a tractor accident this spring he received a lot of support from friends and customers. What he probably didn’t need was a barrage of calls from Greenwich real estate agents, all seeking to buy his land for their developer clients. “They’re like a bunch of buzzards flying around a dead carcass” he told Greenwich Time, and I share his disgust. It’s this kind of behavior that’s earned Realtors a reputation right down in the sewer with politicians and lawyers (well okay, I considered laminating my lawyer business cards so I could scatter them around accident scenes, but I didn’t do it). Mr. Augustin doesn’t want to sell; he would like some assistance in paying his huge medical bills. A committee is being established to accomplish just that and, when it’s up and running, I intend to contribute. Perhaps some of those ghoulish callers might do the same.

Selling It
I see that, after two years on the market a certain house finally sold this week for $2,500,000 less than its original asking price. I’m sure the unhappy seller is convinced that this is proof that the housing bubble has burst but I remember touring it back in July 2004 and, while I like the house, I thought that it was at least $1,500,000 and perhaps as much as $2,000,000 too high. In a super-hot market, comparable prices might have risen during those two years to catch up with the owner’s desired price but that market doesn’t exist today (and it would never have caught up with the 50% premium this one asked) so the seller had to come down to catch it. I don’t see the final sales price as evidence of anything except what has always been true: if you over-price your house it won’t sell and, eventually, you’ll pay a penalty for being exposed to the market for so long.

On a related matter, the listing for a renovated house in Cos Cob has expired and the house remains unsold. I heard through the grapevine that its builder could have had a deal but refused to correct some open construction items which violated our building code. This is not the market to play hardball, especially if you’re quibbling over details that, under law, you’ll have to fix anyway.

“Nervous about the Market”
Many agents tell me that their buyers use this phrase to explain why they are unwilling to bid on houses. If you’re among that crowd I think you’re missing an opportunity. The market is not dead, nor are prices falling. Your braver competitors (and when you’re looking for a house, you have competitors) are picking up some very nice houses at reasonable prices while you sit on the sidelines. Are there over-priced houses out there? Sure, but you and your agent can sort those from the good buys and proceed. I realize that Wall Street is determined to see everyone pull their money from real estate and invest it with them but I hunted stock brokers for a long time and watched their shenanigans and pure stupidity (best example, the fellow who pitched Winstar Communications as “that GM company that puts call buttons in cars”. SmartMoney.com called WinStar “a prime example of the tightrope financing, shameless stock promotion and blind faith in the future that ran rampant across Wall Street over the past few years.”). In short, these are the same folks who brought us Enron, Pets.com and chains that (briefly) sold fifty varieties of popcorn. I don’t trust their financial advice and I certainly don’t trust their supposed knowledge of the current Greenwich real estate market. If you do, you may end up like the plumber I met who was still renting an apartment because, when he had a chance to buy a house for $15,000, was told by his father to “wait for prices to fall”. He is still waiting.

To update some statistics from two weeks ago, 177 houses have gone to contract since April 1, in all price ranges. We’re on track to equal last year’s volume and last year was the second best year (surpassed only by 2004) in Greenwich real estate history. And, finally, I’ll repeat that houses are not “investments” – they’re a place to raise your family. It’s just a nice bonus that, over the years, Greenwich homes have returned a sizeable premium for money spent.

Do As I Say …
Saw a cop using a hand-held cellphone the other day as he cruised the Post Road. Do you suppose that he turned himself in when he reached Headquarters? Neither do I.

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Dig This!
Last week I turned over the soil in my vegetable garden in preparation for planting. Just as I was finishing I looked down at my feet and spotted what I took to be a large, perfect arrow head. Thanks to Greenwich native Tod Hinlicky and his friend, Professor Ernie Weigand of Norwalk Community College, I learned that I had discovered a prehistoric spear head from the Late Archaic Period, 2,500 B.C. to 1,700 B.C. I’ve been looking for this sort of thing since I was a young boy and I choose to find it – er, encouraging that one turned up after 4,000 years just two days after I finished my book on Siwanoy Indians. Or it’s just a matter of frost heaves – I prefer the former. There are some interesting reflections here, aside from the nature of the universe. One is how slowly technology changed back then – these stone points were made in the same, identical fashion for 2,000 years before someone dreamed up something better. Another is the ephemeral nature of real estate “ownership”. I wonder who’ll be on this piece of land, and whether the land will even be above water (water level fluctuates – when the point was made, the sea level was 20 feet lower than today) 4,000 years from now. Neato, says I.

How to Sell your House
The owners of 11 Old Wagon Road (disclosure: my listing, but it’s an apt illustration) did everything right to prepare their house for sale. First, they maintained it during their years of ownership – nothing fancy, but they kept it in good shape and repair, moved a few walls to open up the floor plan, etc. Then just before listing it they power washed the siding, fixed a dented downspout, trimmed the shrubs and so forth; all those little things that make a first impression positive or negative. They redid the master bath and, finally, priced it right: $1,035,000, fitting it nicely in between the few Old Greenwich houses it would compete with. Has it sold? Tune in next week but as of this writing, two days after it hit the market, it’s being shown constantly and I predict good things. So that’s about it: maintain your house while you own it, get it looking as appealing as possible before hitting the market (I’m not talking “staging” just putting away clutter and such) and price it so that it will look better than its competition. It will sell, and sell quickly.

No Mow Grass
Awhile ago I mentioned that Scotts is working on a genetically-engineered grass that requires minimal mowing and maintenance. There’s a condominium complex on the corner of Orchard and Valley in Cos Cob that’s gone Scotts one step better: plastic. They’ve swathed the entire yard in Astro-Turf and, actually, it looks okay. Whether it will look odd in winter when everything around it is brown, we shall see but no one’s spending a dime on lawn care right now and that must help the budget. Wave of the future? I hope not.

The Beach, Revisited
Just in time for free publicity for my book, another law suit has been filed concerning access to Tod’s by non-resident pedestrians and bicyclists. I don’t understand why we as a town are fighting so hard over this. The main concern over limiting admission, so far as I know, is over-crowding and lack of parking. Bicyclists and joggers seem to loop around the Point’s road network and then go home; at least, I’ve never seen one toting coolers and blankets. Besides, as a bicyclist myself, I find it annoying to have to remember to transfer my beach card from my wallet to my sock and than back again. I love the beach and consider it one of the town’s finest assets – I just don’t see an open admissions policy for pedestrians to be a threat. Now, fireworks every night . . . .

Going, Going Gone

Twenty-two houses went to contract last week, including several in bidding wars. There’s still plenty of inventory and I’d prefer to be a buyer than a seller right now but if you are a buyer, don’t delude yourself and think that a well-priced house is only attractive to you. I did see that one house that went to contract did so after five years on the market. I ran the history and see that it was originally listed at exactly it’s last asking price way back in 2001. It came on and off the market since then with, first, an ever-increasing asking price and then a steady decline until it returned where it started. Burst bubble? I think not; rather, a seller with an unrealistic opinion of his house’s value. It’s a very nice house but I never showed it over those years because I didn’t think it was worth what was asked. Once it was, it sold.

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The State of the Market

A real estate column (not this one, thank goodness) recently opined that “a pattern has emerged in the real estate market in lower Fairfield County ….[S] ingle family home sales have spiraled down or remained stable. Prices continued their upward run in Norwalk, Westport and Darien….Condo sales may be up, or down, but prices are still on the increase.”

So there’s your pattern: we’re either in a death spiral or soaring or staying level – okay?

The market is a bit confusing right now, but, despite what Barron’s says, there’s no death spiral here. I heard another agent say that our market is down 56% from last year. That’s absolute nonsense and, since rumors and nonsense can (sometimes) be defeated by facts, I looked some up. Turns out, prices are actually up, not down. Inventory has grown, but well-priced houses continue to sell. Here are the numbers for single family homes, 1st quarter: 2006: 156 sold, $2.8 million average, $2.1 median; 2005: 166 sold, $2.37 avg., $1.675 median; 2004 (best year ever): 173 sold, $2,21 average, $1.550 median; 2003: 136 sold, $1.757 average, $1.175 median.

There are at this writing (June 9) 151 single family houses under contract in town, most of which, presumably, went to contract after January. I can’t dig up the number under contract for the same period in 2005 but I do find that 85 houses sold in July of that year and 107 in August (192, total). As a rough rule of thumb the majority of contracts close within 90 days, especially when school starts in September, so I think most of these can fairly be traced back to May and June contracts. If we average 4 contracts per day (a modest expectation) between now and the end of the month, we’ll have 215 houses in contract. “The bubble has burst! The bubble has burst!”

Inventory as of June 1st, 2006: 542; 2005: 468; 2004: 425. Our inventory is 14% higher than at this time in 2005, but that’s an improvement from January, when we were 34% higher. Houses are being picked off.

In summary, like politics, real estate is local. Stocks are traded worldwide, and what happens in Urkistan may very well effect a hedge fund in Greenwich. But before you believe that condo gluts in Florida or layoffs in Flint mean the value of your house in Greenwich is collapsing, check things out around town. How’s your hedge fund doing? Anyone lost her job at your firm? Nice bonus last year? Chances are, you and your peers are doing just fine. If so, guess who’s ready, able, willing to buy a house in this town?

On Top of Old Smokey

Well, on top of Round Hill, anyway, David Ogilvy has just listed a fantastic old house that is one of the last of “The Great Estates”. The house is very nice, with all its original (1939) charm including beautiful moldings and carved woodwork but forget that, what sets this house apart from anything else I’ve seen are its views. To reach the house, you climb a long, winding red gravel driveway and arrive in a courtyard that has views of Long Island and Long Island Sound – I swore a felt a sea breeze, in fact. From the house, and its beautiful lawns, those same views are present, as well as the Manhattan skyline. I’m told that, when the leaves are down, the Berkshires can be seen. All those views are protected because the top of the hill is 570’ and the adjoining properties are at least 60’ below. Until we rezone for high-rises in the Back Country, no one’s going to spoil your day. Twenty-two acres of gardens, lawns, meadows and woods, a pool, tennis court. And all the usual accoutrements you’d expect at this price which, by the way, is $38,000,000. I’m a little short this week but if your year’s going well, there’s not another property in town with this nice a location. It’s a real estate cliché to describe a property as “truly unique” but in this case, it’s true.

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Memorial Day Parade
I don’t want to sound ungrateful to its organizers, but this year’s Memorial Day parade in Old Greenwich was the most disorganized, skimpiest creation ever. I understand some of the difficulties, including, from what I’ve read, the recent practice of various marching bands to demand an appearance fee which has drastically cut their numbers from our little march. But when I participated in the parade, both as a kid and later as a parent, there was an organizer back at the starting point who ensured that everyone stepped off at the right time. Judging from the half-hour delayed start and the straggly gaps between Little Leaguers and gardeners this year, that person must have retired. I’ve always enjoyed the parade and liked the fact that anyone who wanted to could join in. Nothing against Brownies and kids on bicycles, but I miss the soldiers (we did have one, Christopher MacDonald, back from a year’s duty in Iraq- thank you, Mr. MacDonald) and the marching bands. And send more bagpipes!

Computer Wizaard
I’ve been a Mac guy all of my computer life (that would be since 1988), so I never had to learn anything about the machines – just plug them in and off you go. That innocent life changed recently when I bought a new Mac that also runs Windows so that I can access the MLS from home. It took me twelve hours to get the Microsoft side up and running- sheesh.

So when I wanted to install a wireless network I didn’t try to do it myself but instead Alex Lahuerta here in Greenwich. What a smart move. Alex is a 2001 GHS grad, a former engineering student at UCONN now working as a consultant to earn the rest of his way through college. When he sat down at my computer and started keying in like mad it was obvious that he’s a pro, completely at home with computers and multi-tasking. He simultaneously dealt with getting his dog home to his native Norway via Icelandic Airlines, SBC’s DSL voicemail hell for obtaining system configurations and explaining to me what was going on and what he was doing. Fabulous effort, fabulous results. And he charged all of $45 per hour (he tried to discount his time to an actual elapsed time of 45 minutes, but, having recently paid $120 for an hour of completely ineffective “repair” service, I wouldn’t hear of it). Bottom line is that I’m now cruising the Internet effortlessly and speedily, all thanks to this young man. Alex will tutor, install, repair and consult on all things computer. He’s gracious, polite, smart as a whip and, although he doesn’t realize it, dirt cheap. You can exploit all this (and help him finish school) by calling him at (203) 940-1403 or emailing him at solutions@AlexLahuerta.com. If you run a small business or just want help with a home computer, I can’t recommend him more strongly. Go for it.

Mea Culpa
A few years back I described Cary Road in Riverside as the worst street in town. Not surprisingly, I heard from a number of the street’s residents who disagreed with my opinion. I said somethng snarky about the rusted chain link fences on the road and let it drop. But I recently sold a small house in the area to a young family and, in the course of repeated viewings, inspections etc. had the opportunity to meet some of the neighbors. They’re absolutely great. Friendly, unpretentious, generous and welcoming. And I wasn’t tarred and feathered. So I was completely wrong, and I apologize. If you’d like to join the fun you have an opportunity via Lynne Stewart’s new listing at 10 Cary. Small bungalow right on the Mianus, asking $779,000. I’d suggest that it’s a teardown but then I’ll probably re-offend a new crop of people, so I’ll just say the setting will support a very nice house in a very nice neighborhood.

19 Shannon Lane
At $1,225,000, this house seems to be priced way below market value. Looks rather boring from outside and it’s a split level (horrors!), but absolutely pristine inside, with a very nice layout. With what you’ll save on this house’s price you can afford a decent architect to redesign the exterior and you will have a real bargain. Ellen Mosher’s listing.

Unidentified Location
I just toured a very expensive new house and was disappointed to see that its builder took every opportunity to skimp on finishes. It shows, and shows badly. Unfortunately, most buyers couldn’t care less about how a house is built: sophisticated drainage systems, quality of framing, efficient furnaces, etc. What they notice, and what they will pay for, are finishes. So load up on the marble and expensive trim work if you want to receive top dollar.

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Venting
I’ve noticed that builders of many of the new, hugely expensive houses popping up like mushrooms spend a fortune on the exterior: cedar roofs, copper gutters, etc. and then ruin the effect by venting fireplaces and dryers with cheap aluminum pipes stuck through the side. It looks like hell, so I checked with Old Greenwich’s Jan Ivarsson, my source of knowledge for everything involving high-end houses to see if there are alternatives. He assures me that there are, including more attractive and expensive vents, and designing a chimney ahead of time to incorporate a pocket to shelter (and hide) the now mandatory outside air source. Jan points out that appliances are usually the last things to arrive at a new house and the vents are often an after-thought, which explains why so many end up protruding at eye level, right next to the front door. Dumb. A good architect and a good builder will think things through before ever starting construction.

Bidding Wars
They’re still going on, despite what you read in the New York Times. And houses continue to sell: in Old Greenwich alone, four houses in the $3,500,000 – $4,000,000 range went to contract recently. Many buyers are certain that, these days, they’re the only ones interested in a house and they refuse to feel any sense of urgency. That’s fine, and entirely justified when dealing with an overpriced property. But, priced well, houses are attracting multiple bids, so listen to your Realtor. And if you don’t trust her advice, what are you doing with her?

Inventory
On the other hand, our housing inventory continues to build. Single family homes are up 14% from this time a year ago, condominiums 54% (both numbers courtesy of Bob Fossum, Shore & Country). What this tells me and should tell you is that this is not the time to try for a record price. There are plenty of choices for buyers out there and if your house isn’t offering good value for the dollar, those buyers will go elsewhere.

Overlooked on Oval?
When Rick Loh first listed 22 Oval Avenue in Riverside for $2,195,000 I thought it was a good price for a great house and said so in this column. My powers of persuasion aren’t much, obviously, because the house is still available and is now priced at $1,895,000. This is a funny business – some houses that we agents love can sit, ignored, while dreadful, overpriced (in our opinion) monstrosities get snapped up instantly. The marketplace dictates what happens out there rather than any one agent’s opinion, but here’s my recommendation again. This is a wonderful house, built in 1926 and renovated in 1999. Nine-foot ceilings, very nice back yard, on a great street within easy walking distance to the train, Eastern and Riverside School. I don’t know of anything as nice in its price range.

Risk Aversion
I see that our Selectmen have repealed the 1957 ordinance that offered a $1.00 fine for parking tickets paid within 24 hours. It was fun while it lasted, but I suppose the repeal makes sense. I noticed that when doing a quick risk/benefit analysis at parking meters last week the reduction of the possible penalty from fifteen dollars to a measly buck resulted in my quarter remaining stuck in my pocket. That’s no way to run a railroad.

Not In My Name
(Readers who become infuriated when I diverge from real estate should skip this paragraph) Richard Blumenthal seems to think that the best way to become Senator is to oppose every attempt to bring energy to this region. As the official legal representative of this state he has blocked, repeatedly, cross-Sound electrical cables, a LNG terminal and a natural gas pipeline. His latest effort, an injunction against the natural gas pipeline, was denied by a federal judge two weeks ago. Coincidentally, on that same day Connecticut’s National Public Radio station aired a story about impending blackouts this summer. I sail, fish and even swim in Long Island Sound, and support any reasonable plan to clean it up and keep it clean; I also live and work in this state and want to see it prosper. I don’t see an incompatibility in those goals but our Attorney General does. We’ll see what happens, but Connecticut already has one of the lowest growth rates among the fifty states, one of the highest costs to do business in and some of the most expensive energy. A proponent of those policies doesn’t seem like a good candidate for higher office, to me.

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