Moronic builders from out of town

5 Dialstone Lane, RVSD

 

On July 16, 2009, I wrote this:  

I’m off at 5:30 to see a new spec house at 5 Dialstone Lane, soon to come on the market. What price? Let’s all guess asking price and ultimate selling price. Mine is $3.4 ask, $2.65 sell (a year from now). Fire away. If I learn the proposed asking price when I visit today I’ll report it – otherwise, we’ll all just have to wait and see.  

UPDATE: Well, I wasn’t able to see the entire house because the builder threw me off the premises. He was upset by my guesstimate of its selling price which, as he pointed out quite forcefully, was made before I’d had a chance to see the project. Of course, now I never will. Oh well, here’s a review of the part I did see: beautiful construction, with tons of custom built ins, expensive trim, coffered ceilings, etc. Very, very nice. The place is super insulated – foam, with a high efficiency boiler and every imaginable electronic control. Radiant heating in all baths, six fireplace with gas, heated two car garage, finished lower level (which I didn’t have an opportunity to see but I assume is of the same high quality as the rooms I did see while running for my life).  

Downsides remain the same as when I first opined on the sale price: it’s on a quarter acre, which means no back yard – a terrace, but no yard. The terrace itself backs up to the swamp that runs from Lockwood to the interstate; good for deer and adventerous boys but bad for buyer appeal. And, while Dialstone may be, as described in the sales material, “a quiet cul de sac”, Lockwood Avenue is not, serving as it does as the cut-through for everyone wishing to avoid Post Road traffic.  

Back inside, the children’s bedrooms are tiny – endemic in new construction as discussed earlier today but these bring the definition of “cozy” to a new level. The next generation of builders may discover that it’s better to have shared bathrooms and larger bedrooms but that’s in the future. For now, these are pretty typical, if a little smaller than normal.  

The builder has priced it at $3.675 million and at the risk of offending him further, I remain skeptical. I have sold a fair number of houses in Riverside and I know what $3.8 new construction looked like and what $3.2 offered, and that was in a robust market. I hope he gets every penny he asks for; he’s obviously lavished a huge amount of care and attention to this house and cut no corners that I could see. But I based my original opinion on market conditions and, nice as this house is, I think Mr. Radman, the builder, may be disappointed. I sincerely hope I’m wrong.  

UPDATE II: Too funny. A reader points out that this house is listed with another firm and another agent for $3.995 million and has been for 66 days, according to Zillow. What’s so funny? Well the Zillow estimate of value is $2.4 million dollars! I wonder if our angry Mr. Radman will be pounding on Zillow’s door, demanding a retraction?  

August 31, 2010: sold yesterday for $2.445.

17 Comments

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17 responses to “Moronic builders from out of town

  1. Anonymous

    Chris:

    We’ve seen his houses in Westport. Similar story, absolutely beautiful – all top quality but they are always on a postage stamp lot in bad locations.

  2. Demmerkrat Patriot

    Perhaps you should rename your blog “The Amazing Fountain of Accurate Pricing!”

    I guess I’m continually amazed that, in the face of a death spiral for Greenwich real estate, many builders and brokers still wear their rose colored glasses.

    I have a friend who’s a broker who once stated, “Greenwich real estate never loses, it levels off.” The statement was made about the recession of the early 1990s. Now this broker says the golden rule of never losing in Greenwich real estate has been broken, perhaps forever. The gravy train is over, folks, grow up and deal with it.

    I suspect this to be “The Winter of Our Desperation” in Greenwich real estate. Perhaps the broker herd will be culled, and the true professionals in Greenwich real estate will remain.

  3. Retired IB'er

    Don’t you just hate being wrong… you were off by $200,000 and it took a month longer than you said to sell. What you can’t get your estimates better than within 5%… no wonder the builder was mad.

    It is a wonder anyone would use you as a broker given your poor prognosticating ability.
    ;-)

  4. Jane

    Is that snickering we hear?

    • Jane: Well not quite a belly laugh, but, I regret to say, more than a mere snicker. If the builder hadn’t been such an irate asshole (and how the hell did he read my blog comments within fifteen minutes of posting?), I might be more sympathetic.

  5. Cos Cobber

    CF did a nice job with his prediction, however I do think this was one of the easier ones to predict. Unless the fixtures are made of precious metals which can easily be smelted, there is a cap on what one will pay for taj mahal structures on postage stamps lots and that figure in this neighborhood is in the vicinity of $2.4 to $2.7MM.

  6. So Greenwich

    do you advise on what numbers to play in lotto too?

  7. FlyAngler

    So here’s a question, if, as the article linked below suggests, NYC prices are firming, in part due to Wall Street’s strength, would Greenwich not benefit as well? If I recall correctly, more than once is has been suggested here that “as goes NYC, so goes Greenwich”.

    Sure, I could make an argument that the Street’s strength might be fleeting given recent performance. Or that the smart money that can afford $5mm+ houses are hunkering down and renting at this point. But is that true of all? If so, why, would NYC be firming?

    I am not looking to pick a fight with my “friends” here, but there may be something to consider here. Yes, longtime readers are free to remind me that I predicted last Fall that the Street would “get paid” and I was right. Unfortunatley, I was less right in my suggestion that we would then see an uptick in activity in Greenwich’s higher end due to pent up demand after 2007-08. Unlike Chris, I was only half right on that “prediction”.

    So have at it, do stable price in NYC mean anything for Greenwich?

    http://online.wsj.com/article/SB10001424052748703369704575462062119390480.html

  8. Patrick

    I think the wild card is the economy. If we don’t double dip then we’re probably close – slight dip to flattening. Key issue is that there are still a number of pending foreclosures in Greenwich – look at the Druid property that sold at $1.4. Before we stabilize this needs to get flushed out of the system.

    NY just has more liquidity in general. If you have a coop you were probably financially stable and had put enough down anyway – no 5% for coops. Condo’s can easily be rented if you get into trouble Greenwich just doesn’t have that level of liquidity.

  9. G'wich Transplant

    Patrick makes a very good point. The vast majority of housing inventory in Manhattan are coops which, at a minmum, require 20% down. Many coops are significantly higher, with the ritzier buildings on 5th/Park requiring 75-80% down or prohibiting financing all together.

  10. DebtVulture

    Land prices in Japan declined for 18 straight years after their crash. Sure, their prices rose farther than ours, but we haven’t dealt with the core problem impacting asset prices here – too much debt! Until we recognize that the debt is bad, we are going to muddle though, IMHO.

  11. Cos Cobber

    DebVulture, Japan’s extended land price declined can be partly blamed on an anemic birthrate and the country’s anti-immigrant culture & laws: no?

  12. DebtVulture

    CosCobber:

    U.S. birthrate is following suit:

    http://www.huffingtonpost.com/2010/08/27/us-birth-rate-sets-record_n_697131.html

    I think another big contributor to their extended slump is the fact that they keep trying to sweep problems under the rug. We are doing the same by trying to inflate housing prices, force banks to lend, reinflate other asset prices instead of hitting the reset button, etc.

    Of course, their land prices were absolutely insane, with estimates of over $100k/sq ft for prime retail space at height of market vs nowhere near that here in the U.S. Still, we are becoming more like Japan every day. Stocks have gone nowhere since 1998, rates are near zero, etc. Oh, happy days!

  13. Cos Cobber

    But its difficult to foresee our birthrates reaching Japan’s lowly figures and we have immigration, they dont.

  14. DebtVulture

    Yes, and we have inept politicians, years and years of losing manufacturing jobs, debt up the wazooooo, consumers tapped out, over 20% of the homes underwater, trillions and trillions of off balance sheet liabilities, etc. not even being addressed (unless you think Obamacare fixed Medicare instead of making our liabilities that much bigger). But don’t worry, we’re not Japan!

  15. shoeless

    At least Japan’s debt is owned by its own citizens. We’re indebted to third parties, which never ends well when you can’t pay them back.