There’s money in town

I hear tell that there’s an accepted offer on 253 Round Hill Road, that Billy Gardiner spec house asking $23 million. I’m not surprised, because I’ve had some very wealthy clients interested in the place myself. None were willing to even approach its asking price, and I doubt the guy whose bid was accepted did either, but even if it goes for, say, $12-$15 million (and that’s just a guess on my part) that’s a significant anmount of money.

Similarly, I was reflecting this evening that my clients, combined, have offered something like $20 million on a number of houses. Most of those bids are awaiting a response and some will come out next week but if I’m typical of other agents, the woes of Greenwich are attracting some serious dough. It’s ironic that, of the two bids I’ve had rejected so far, both were closer to the actual market value, in my opinion, than the seller’s asked for price. And one was actually very close to full asking price – the seller just decided that he would stick to what he’d decided he needed, rather than sell for what it was worth. His loss.

So we may see some real movement shortly. Or, the sellers will continue to resist and the buyers will retreat to the sidelines and wait another six months to see what time does to the sellers’ resolve. I have to admit, I am having fun in real estate for the first time in my career because there’s something to do other than just serve as an order taker. Dig up every scrap of information on a seller’s financial situation, talk to banks and private lenders, twist arms, kick tires and, all in all, earn my pay. It’s gratifying.

11 Comments

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11 responses to “There’s money in town

  1. kidding really?

    Chris… this is the “Spring Selling Season”. Let’s not get carried away. Business SUCKS.

    • christopherfountain

      I think you’ll be surprised how much business doesn’t suck in the next few weeks, Kidding, or at least I hope so. There are tons of buyers out there – if sellers stop killing deals over a 6% difference in price things are going to pop. If not, well, the sellers can wait til fall and see if their hopes are rewarded.

  2. Retired IB'er

    Chris,

    So reading your realtor tea leaves, which way is the water breaking… in favor of buyers or sellers?

    • christopherfountain

      I’m guessing IB’R that the standoff will continue at least through the summer, and then one side or the other will cave: sellers, if the fall market doesn’t materialize, buyers, if sales resume. My money is on the buyers.
      Until then, I think we will continue to see what we’re experiencing now: occasional sales, limited to heavily-discounted properties, with a rare exception now and then to give false hope to sellers that will encourage them to hang on. 37 Andrews Farm Road selling for 90% ($8 million plus), the land on Meadowcroft selling, perhaps with multiple bids, for $5 million are two such examples. What sellers fail to realize is the exceptional nature of both properties and, in the Andrews farm property, the fact that I think the property was marked down several million dollars from where it would have been priced in, say 2007.
      I have a large stable of buyers and not one of them, in any price range ($1 – $10 million) is interested in paying asking price for what’s out there. I think they’re typical of all buyers today, so either they’ll have to change their minds or sellers will change theirs. For now, the standoff continues.
      We’re coming to the end of the spring sales season, which died aborning. I expect a flurry of contracts reported in the next few weeks as some sellers decide to ditch now, and then quiet will reign for the summer. Come fall, when still more inventory pours onto the market, someone is going to get worried. And I don’t think it will be the buyers.

  3. anonymous

    CF, any noticeable spike in credible buyer interest from young, affluent families leaving Manhattan’s more onerous income tax rates (and housing/schooling costs)?

    • christopherfountain

      Anon, almost every one of my currentr crop of buyers is a young family, husband in the financial industry, looking to get out of the city before bankruptcy strikes again.

  4. Retired IB'er

    Thanks, Chris.

    It is interesting to consider the markets at work. There seems to be creeping sense of “positiveness” for lack of a better word– generally reflected in an 8,200 DOW.

    I continue to believe it will be short lived; if, indeed, there is some traction to this sentiment. I think what we are seeing is a collective sighing of relief that the world hasn’t fallen off a cliff. Therefore, people feel like things are getting better. Reality is more like we are getting use to the bad situation, having started the process of adjustment to a new, down level.

    In realtor terms, what I am trying to say I guess is “I use to sell 10 houses a year, then I went through six months where I didn’t sell one, now I have a couple of sales so the world is coming back. Yippee.”

    Reality is that the level of activity has increased, but from zero.

    • christopherfountain

      I hear that frequently, IB’R from my colleagues: “Sales doubled last month compared to March! We’re back!”. 23 sales compared to 13 is an improvement, but compared to 74 in April ’07, it isn’t. And remember, even if my slap-happy fellow realtors won’t, we’re supposed to be at the peak of the sales season. June,July and August are going to be brutal, but I’m lookig forward to it – whikle myt competitors have given up and gone off to Nantucket to lick their wounds I’ll be here picking off dispirited sellers. Or that’s my hope, anyway.

  5. anonymous

    Know more than a few hedgies carefully evaluating tax residence in Greenwich (or Dallas) vs residence in Geneva or Zurich if commies in US and London force the arbitrage….

  6. anonymous

    CF, admire your positive, intellectual attitude vs a fundamentally cyclic business

    Wish you well in winning mkt share; good to see forthright, curious guys do well in any business

  7. kidding really?

    Chris – It’s like you drank the Obama Kool Aid – Using words and phrases such as “surprised” “hope” “tons of buyers” “things are going to pop”

    Lets look at the current inventory, I’ll guess 3-5 years (you would likely have an exact number) today and in a few weeks! Prices are still way too high based on economic conditions for this buyer. Seeing an increase in selling is a function of Spring and nothing else… glory days are in the past.