Daily Archives: February 26, 2007

FAR and House Values
39 Edgewater Drive in Old Greenwich, a long-abandoned structure, has been placed on the market with an asking price of $895,000. The lot is a mere 0.15 of an acre in the R-12 zone yielding a permissible building size, by my calculation, of just over 2,000 feet. That’s a lot smaller than most people demand these days so I’ll be curious to see what happens to the place. Someone will certainly buy it – the question is, for what price? Regardless, I’m sure the neighbors who’ve watched this eyesore deteriorate for years will be glad when it disappears. By the way: while I’m no fan of the floor area ratio regulations, this lot is an argument in favor – it’s just too small to support a mega-mansion. I still think that set back rules and height restrictions would suffice to control what’s to be built here but, for once, FAR may be helpful.

Woodsman, Save that Tree! Or some of them, anyway.
We now have a new advocacy group in town, the Greenwich Tree Conservancy. Most of their goals, such as updating our inventory of town-owned trees and taking better care of them seem worthy but I worry about their push for a new ordinance that will regulate trees on private property (other than trees in danger of toppling over and damaging a neighbor’s property, which are already regulated via our nuisance ordinance). I share most people’s distaste for clear-cutting and, if builders knew better, they’d appreciate that mature trees add to, rather than subtract from a building’s value, but Greenwich, bastion of free enterprise and property rights, seems an odd place to champion yet another diminution of those rights. And I hate to see yet another layer of regulatory approvals added to the building process. When your neighbor wants to add on, I’m sure you’ll appreciate all the delays and hurdles now built into the building process but when you seek to build your own project, you opinion may change. It’s a jungle out there.

Still Crazy After all these years?
Prices of many new listings still seem out of whack to me and to other agents I respect. So much so that it’s become a steady source of conversation on the open house circuit, as in, “did you see that house on X Road? What are they thinking?!” We could all be wrong, of course, and sometimes are, but it won’t help your prospects for selling quickly if those of us who at least try to be professionals think you’ve been smoking dope. We won’t waste our clients’ time showing houses that are hugely over-priced and, by the time a seller accepts reality and drops his price, we’ve long since forgotten about the property and moved on. I point this out so often because (a) it’s true and (b) sellers just don’t seem to get it.

But Wait, There’s More!
Not every seller is nuts. Tamar Lurie has just listed 19 Lakewood Circle South for $7,745,000, a price ordinary mortals might deem a wee bit high but in fact, it’s a terrific value. A number of us who viewed this completely restored 1930’s house thought the owner could have added a couple of million to its asking price. Of course, that would have entailed months of disruption, keeping everything in showroom condition while buyers strolled through at all hours of the day and, eventually, some sort of negotiated price. Instead, the owners priced it just right and they should be able to get through the process fairly quickly and painlessly. “They want to sell it,” Tamar told me, when I complimented her on the price. What a concept.

Hedge Funds and Greenwich
A panel of financial types recently examined the hedge fund industry and determined that no further regulation was required. Our state’s Attorney General, Michael Blumenthal, crowed that this finding opened the door for people like him to do their own regulating. I sympathize with the man – he’s just watched Elliot Spitzer be promoted to Governor on the basis of whacking Wall Street regularly and no doubt wants to follow him upwards – but, while I’m no particular fan of our country’s financial industry, I have more confidence in the judgment of experts, including three Goldman Sachs alumni, than I do in an ambitious lawyer. I’m not worried about losing money in hedge funds – I have no money- but I do worry about an over-zealous politician driving these people from our state. Who else can afford to buy your house?

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How to Win Friends and Influence People
At a public hearing held to discuss what to do with Glenville School: tear it down, rebuild, wait and do nothing, etc., the Parkway PTA school sent a representative down from the Back Country to scold the crowd. Parkway, not Glenville, she argued, should remain open because Parkway parents pay more taxes than Glenville. Properly chastened, the Glenville folks knuckled the tips of their caps and bowed their heads in shame. Or something. Here’s a tip I’ve learned from spending a half century in Greenwich and observing its politics: people with less money than their betters don’t seem to understand that they should get the dirty end of the stick when it comes to town services. Hard to believe, but it’s true and, surprise! They vote. Try another tactic.

Contracts
As of February 12th, 57 singe family residences have gone to contract this year, which seems healthy. Of those, only seven were new construction, indicating that the market for older homes appears to be coming back.

Prices
I cannot figure out what’s going on with sellers these days. Week after week, we’re seeing houses on the broker open house circuit that are millions of dollars too high, and that’s not just my opinion; other experienced agents say the same thing. So what gives? Have sellers lost their collective mind or are agents telling them anything they want to hear to get the listing? Either way, it won’t work – the market is just fine, but you can’t sell a $2,000,000 house for $3,000,000, or a $5,000,000 house for $8,000,000, not matter how attractive your marketing.

Zillow.com
The Wall Street Journal recently compared 1,000 actual sales to Zillow’s estimate of value and came to the same conclusion I did when I conducted my far less scientific survey: the site is generally accurate but, when it’s wrong, it’s way wrong. The Journal cited one house that Zillow said was worth $600,000 – it sold for $2,600,000. Oops! The danger here cuts both ways because buyers pass on great deals when Zillow says a house is worth far less than its true value and sellers insist on pricing a house far above what it’s worth if Zillow says otherwise. Look: it’s a stone throw’s distance from Hamilton Avenue to Belle Haven. Zillow doesn’t recognize that proximity doesn’t necessarily yield a comparable sale. Be careful.

Marketing
Can’t sell your corner lot house for months and months? One Realtor’s decided to change the address to the other street and raise the price $100,000. Seems silly to me – how dumb, exactly, are we supposed to be? – but it kind of makes sense, in a sneaky sort of way. I’ll let you know if it works.

For this we need Republicans?
Governor Rell has proposed raising taxes on Greenwich by another ½%. Already our tiny sliver (less than 2% of 3.4 million residents) pays 10% of all income tax. Rell wants us to pay more. Connecticut is already the third most expensive state in which to do business. In the past two decades we’ve loaded on an estate tax, an income tax, doubled (!) the number of state employees, are looking to add a “millionaire’s tax” (defined as anyone earning $500,000, by the way), and are now proposing to tax internet sales. As a state, we’re tops in the number of young people leaving and job growth is falling off a cliff. We’re third in the nation for spending per pupil, with dismal results, so Rell wants us to be first. Greenwich’s own Livvy Floren describes the Governor’s budget as, “ gutsy and very visionary”. I have a vision, all right; one that doesn’t include Ms. Floren as a state Representative.

Delta’s Not Ready When You Are
My youngest daughter is off to Costa Rica for a semester. Delta gladly sold us a one-way ticket online (return date is uncertain) but, when we dropped her at Kennedy at 5:00 a.m. she was told that Delta will not board any passenger flying one-way from one country to another. Besides the incredible rudeness of the ticket agent and his absolute refusal to even attempt to resolve the problem, further insult was added when Delta would only “cure” things by selling us a second one-way ticket at a huge premium. Absolutely appalling service; next time this airline returns to bankruptcy and its employees whine about losing their jobs, I’ll be cheering, loudly.

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