Monkeys at the Keyboard

I seem to have annoyed at least one anonymous reader who has been posting mean things about me down below (“For Sale by Owner?”). According to this gentleman, if Greenwich homeowners will only stick to their guns and refuse to sell their houses for less than they were worth in 2007 or “a minimum of $1,000 per square foot” (by which, since almost no houses in town have ever sold for that much, I assume he means 2017 prices), buyers who want to live in our fair city will eventually capitulate and pay whatever price we dream up. Great idea, and an excellent illustration of the idiocy that is causing so many of the houses currently for sale to sit untouched.

I’m reminded of a friend of mine in law school who in 1978 used the $5,000 student loan we all were living in to buy gold, instead of food. The son of a gun bought at some ridiculously low price and managed to sell at $800 an oz, making him a small fortune and leaving the rest of us jealous as hell. I think I said something like, “we can only hope that they’ll discover that owning gold causes cancer” but, unlike my unhappy reader, I was just kidding.

But suppose our reader owned gold, instead of a house in Greenwich? If he bought it in 1978 at $800 and had been waiting for it to return to that price, he’d still be sitting on it today – adjusted for inflation, that gold would have to sell for $2, 516 per oz and, damn it, it’s still at $246 (inflation adjusted). But gold is beautiful, shiny and non-tarnishing. Everyone should want it, and our reader just isn’t going to sell his pile until buyers recognize its true worth and pay him exactly that amount. He must be bewildered by the people rushing past his gold – selling booth, going about their lives and ignoring him. The fools! The idiots! He’ll show them!

Enjoy yourself out there on the sidewalk, fella. And enjoy your gold.

UPDATE: This man’s thinking is too valuable to bury in the comments section. You won’t find a better example than this of what happens when a home’s value declines and that decline, in turn, affects someone’s sanity. So here, for your pleasure, is Joe Homeowner, sharing his insight and economic knowledge for the benefit of all:

Sellers will not capitulate the way that buyers would like. Why?

1. This is Greenwich which continues to be the premier town in the tri-state area.
2. Greenwich residents are wealthy and are not pressed to sell in a falling market. More than any other town we can ride this market out for 5 years.
3. Greenwich homeowners must hold the line! No one should list their homes below 2007 prices. We must condition the market. In time buyers will fold and come to understand that if they ever want to live in our great community they will need to pay up.
4. Brokers better wake up and side with sellers and builders. You work for us! We control the inventory and this your fate! Nothing in Greenwich should ever be priced below $1,000/sft.
5. Chris if you ever want to work in this town again I would advise you to terminate this site! Your shameless attempt to be “buyers broker” will fail as it is short sighted. Do you think that the market will not turn? It will and you will be left out in the cold. No seller will work with you – ever!!! You are cancer!!!

31 Comments

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31 responses to “Monkeys at the Keyboard

  1. Backwoods Bozo

    I see another “astute” poster writes:

    “Chris, this blog is worthless. In fact, you’re shooting yourself in the foot. You’re killing the market. Sellers will not give away their homes for nothing. We’d rather pull our listings and wait for the market to recover. 545 Round Hill Rd expired and guess what asshat?!? Unless I get $20m I’ll never sell! I don’t care if it takes twenty years!! All of you guys are losers!!!!”

    Chris, 1) what stage of grief are these guys in and 2) in your experience why don’t they just take their houses off the market if they’re truly unwilling to sell at current prices?

    BTW, the same attitude exists at the opposite end of the price range in my little burg. A townhome development has 11 units – both new and resale – listed in the $300k range whereas the only one that sold in the past year went for less than $240k. Go figure.

  2. Anon

    I actually thought these guys were trying to be funny rather than serious. Although to be honest I am sure your blog does enrage some sellers……

  3. Greenwich isn't what it used to be

    people need to get over it. greenwich is not what it used to be. you can barely drive around town anymore. you got to use backroads to avoid major jam ups. people from port chester clog the hospital er. a huge shopping wall on the stamford side of post road. the days of old are gone. just like the grand old towns of mamaroneck, larchmont, rye, some day greenwich will get over built, fat, unattractive. if new york as a place to work, anybody got jobs down there, people just say so long greewnwich, it was nice to know u, the bubble burst in the town. greenwich is on a long slow decline. a house is not worth what a reltor says. a house is worth what someone wants to pay, sorry less these days.

  4. Anonymous

    Words escape me but I think the Antares guys have garnered a few disciples.

  5. Debtvulture

    Good thing I had my coffee before I read this post….$1000/sq ft….couldn’t stop laughing!

  6. Anonymous

    If you can’t afford to live in Greenwich them don’t! Go live in Bridgeport! I hear that there are ton of great deals to be had there!

    I maintain that if sellers stay the course that buyers will eventually return to their senses in 2010. And guess what? Homes will be trading above 2007 levels and greedy buyers in today’s market would have missed out! Only spec house builders will get hurt in this market. Homeowners such as myself can afford to wait!

  7. Tom A.

    While I totally disagree with most of what that poster wrote, I think there is some truth the to argument that your blog only contributes to the problem. Or maybe the better way to say it is that the information you post doesn’t help things much. As anyone who has ever bought or sold a house knows, the market is driven by information — the more you have, the better you can determine what the right price is for a particular property. The less info you have, the more room there is for idealism (what you hope to get/pay), creativity (what you think extras are worth), etc. I don’t think much of what you post isn’t already public information, but for the most part, buyers/sellers don’t either know how to gather it themselves or don’t care to do so. So you are injecting highly-relevant information into the market at a time when buyers/sellers (mostly sellers) are desperate for any information. I think you would be hard-pressed to disagree that the daily gloom-and-doom reports don’t serve to prop up the market. The real estate market in Greenwich, like any other wealthy town or city, market will come back eventually. Nothing you post will change any of that.

  8. anonymous

    Keep up the great work, Chris

    Suspect many economically rational buyers/sellers have greater respect for a realtor who understands basic economics and market realities, rather than the typical ill-informed/dishonest agent

    Unlike most mkts, Greenwich has more than a few buyers/sellers who (rather quickly) analyze and decide upon much larger deals than mere houses in their day jobs

    In any transaction, some principals and some advisors are unsavory and/or unreasonable….not surprisingly, some self-selection among principals and advisors tends to occur….

  9. Greenwich High School ranked #1 1977/now #12 2009

    A measure of a town is the high school ranking. Connecticut Magazine doesn’t even put GHS in the top 10 schools in the state. Rank based on stuff like SAT scores.
    An aside, in 1977 nobody would send a kid to brunswick and only prissy girls went to Greenwich Academy. All those parents sent kids to GHS. This helped boost good scores with bright kids in public schools. Now all the hedge funds for the last 20 yrs have made the private schools far stronger pulling smart kids from public schools. Scores dropped at GHS and the ranking as well.
    Greewich WAS a nice town once-probably slowly deflate over next 20 yrs-wait till they widen I95.

    • christopherfountain

      I agree about our schools’ decline – in fact, the only bright spot I can see about our current mess is that it may result in the return of a bunch of bright kids to our high school. They’ll find plenty of intelligent kids already there and waiting for them, but it can only improve things. I think.

  10. pulled up in OG

    “Unlike most mkts, Greenwich has more than a few buyers/sellers who (rather quickly) analyze and decide upon much larger deals than mere houses in their day jobs”

    Yeah, they did real good there too!

  11. greenmtnpunter

    FSBO and a few of the other unmotivated seller/ commenters seem to be in total denial and/or simply do not understand the function of a broker. A broker’s job is to make the market by reflecting the prices that buyers are willing to pay in any given market for stocks, real estate, sugar, wheat, gold, or whatever it is you are selling.

    If the “ask” prices are too far above the “bid” prices, then there is no chance to negotiate. And as Chris pointed out the other day, if a seller isn’t motivated to sell in this market then it is best as a broker or buyer not to spin your wheels. The reality is that brokers cannot afford to waste time with unmotivated sellers. Period.

    As listing brokers we do represent the seller, no doubt about it. And that service very much includes informed counseling regarding actual market conditions, not what we wish them to be. What kind of service are we brokers delivering if we don’t educate the seller, our client, about current market conditions?

    Too many brokers are too inured to the easy market ways when prices were doing nothing but going up and would simply quote high to obtain the listing. This market is not nearly so easy or so much fun since it requires being a messenger of bad news…which only only seems to get worse.
    Let’s all hope for the best- along with the new administration- that consumer confidence will make a comeback this spring.

  12. InfoDiva

    I think there’s a troll afoot, Chris, and you’re falling for his act.

    • christopherfountain

      That was my first thought, Diva, but his stupidty sounds so sincere and so much like what I’ve heard from actual sellers (although Monkey is more brazenly dumb) that I decided to go with it. There really are people who think like him, even if he doesn’t himself. Besides, it’s amusing!

  13. Anonymous

    You know you have arrived as a blogger when you have commenters repeatedly taking the opposite side of an argument.

    These guys who think you are so anti-good prices in the Greenwich market should go back to the archives to read some of your posts from 2004 and ’05 when you talked about how Greenwich real estate doesn’t lose value. No critisim of you for that sentiment – it certainly appeared true at the time.

    Keep up the good work.

    • christopherfountain

      Greenwich real estate doesn’t lose value? As I’ve confessed here before, I did believe that – since 1957, when my grandmother bought her house for $17,000, I watched over the years as it, and everything else in Greenwich gained steadily in value. There were certainly years in which prices might drop, say, 10%, but we’d make back that loss the next year. I told buyers that if they bought and held on for 5 years, they’d sell for at least what they’d paid for it and probably more. And that was true, until it wasn’t. I never expected the financial services world to tank so utterly and completely, world wide. Life’s just full of surprises, ain’t it?

  14. Anonymous

    InfoDiva, I’m not a Troll. I’m a daily reader. I typically do not post but I’m so sick and tired of all the negtivity. There was a time when this blog was a dependable source of real estate data and market color. As someone who had a property on the market recently I’ve grown tiresome of the doomsday scenarios and blantant shilling for dishonest lowball strategy. I hold Chris partly responsible for this mindset. The Greenwich market might me in a very slight slump but the market is not down 30-40%. The Greenwich market shall rebound and I’m going to be laughing my face off!!!

  15. Retired IB'er

    Different price point, similiar point of view. Logical (or should I say inevitable) outcome… take note Monkey:

    The Ventura County Star reports from California. “Rose Vicente is tired of waiting. Sixteen months after she and her husband, Manny, put their Simi Valley home up for sale for $650,000, they decided they couldn’t put their life on hold any longer. Although they still are waiting for a buyer, the Vicentes purchased a home in Wildomar, Riverside County, and plan to move in February. Last year, the Vicentes told The Star they wouldn’t budge when they lowered their asking price on their five-bedroom house to $495,000. Their outlook has since changed.”

    “The Vicentes just slashed their asking price to $379,000, a 42 percent reduction from their original asking price. Their experience mirrors what is happening in the weak housing market. For the Vicentes, the substantial price drops gave them the ability to buy a second house in California, without being forced to wait until they sold their Simi Valley home. They decided on Riverside County because they were able to buy a 3,500-square-foot house — twice the size of their current home — for $300,000.”

  16. anonymous

    Public schools are academically weak in many affluent suburbs….and/or physically unsafe in many others, like Greenwich, due to local slums feeding into schools

    CT’s low state income taxes and lower property taxes excuse Greenwich’s crappy public schools

    Besides, suspect many parents view elite private schools as valuable career networking, given the major HF billionaires whose kids tend to attend private schools…arguably educational and inspirational for both the parents and the rugrats to be the relative paupers in a school….

  17. fred

    Don’t worry. The Greenwich market will rebound as there is no shortage of wannabe snobs like some who have posted here. And yes, even a home that is situated next to a sewer pump station and overlooks the metro north tracks will sell at a premium, as it is not just a house but more importantly a zip code.

  18. Stanwich

    Chris, what are you thoughts on 23 West End? I think a new posting is needed. Now I understand that it is not the optimal location but at a certain price the house is compelling. Discuss…..

    • christopherfountain

      Stanwich, I did write something about 23 West End just a day or two ago. I think at $999 it’s a good – looking deal. Not a bad house, trains don’t bother me, and the sewage pumping station, while not the most desireable thing to have as a neighbor, isn’t the worst, either. Walk to town, shops, train, parks and school, brand new house, under a million, seems okay to me.

  19. Kidding Really??

    Chris…. it’s ALL YOUR FAULT. If it wasn’t for you, house prices in Greenwich would be up up up as there is “pent up demand” according to a well known broker!

    I am patiently waiting to buy a house but in no hurry as it doesn’t take a genius to see what is going on with the investment banks, hedge funds and private equity funds. Massive layoffs are happening all over the place and housing supply is up. Nobody is making money in the stock market and a generation of wealth has been lost if you worked at an investment bank. I wouldn’t kid yourself thinking people in Greenwich are not nervous. Greenwich is wealthier of course therefore the cash burn can last longer than other towns so people will hold on for dear life hoping for something to save them.

    • christopherfountain

      Kidding – if someone’s not in a hurry to sell, this is not the time to do so (duh). Certainly, my family’s not going anywhere, and the price decline, while depressing, isn’t actually affecting our economic survival. And there are lots of homeowners in the same situation (which makes me wonder why they have their house up for sale). The pain will be those who lost their money in Lehman or Bear Sterns, have equity loans that now exceed their home’s value, lose their job, get transferred, divorced, die, etc. I’m sorry to report that I think there are a number of families in town in these latter situations and I fear there will be more. If so, the floodgates will open and we’ll all take a bath, at least on paper, including Mad Monkey. Obviously, I pray that I’m wrong. A bright note: I often am.

  20. Cos Cobber

    Anonymous should double down; stop selling and start buying if houses are so ridiculously undervalued.

    You really have wonder; which trouble real estate development could Anonymous be chained to? Beacon Hill, that townhouse under Whole Foods; Riverstone; etc – etc…

  21. Mad Monkey

    It only takes one buyer (i.e., sucker) to lift an offer – no matter how mispriced. Though some of us might have missed the highs of 2007, there’s nothing wrong with sellers of prime properties kicking tires themselves and testing the market. Buyers must understand that sometimes you have to pay up, even in a down market, to have the opportunity to purchase a truly exceptional property in a great community. Though jewels sometimes come onto the market at the top, many more come onto the market on the way down, albeit late, e.g., sellers remorse. With that said, seldom are these properties ever “priced to sell” at the bottom – you still have to pay up.

    IMHO, you always have to pay above market for great listings whether the market is strong or weak. For example, view all the non-spec properties on the market above $17 million. Those are prime properties. If you want to live in one of these homes, you’re going to have to pay 2007 prices. No question about it.

  22. anony-moose

    This new anon character reminds me of “Real Estater” at burbed.com (which serves the SF bay area). Only, over there the talk is about how one can’t compare the “RBA” [real bay area] to the rest of the bay area, and how declines in those other areas is “useless aggregate data” for trying to predict price trends in the more expensive zip codes. I wonder if this blog’s version will stick around…

  23. Anonymous

    THIS GUY IS NUTS . IS HE FOR REAL? First of all if you really do not have to sell get off the market if you can sit and ride it out you are lucky and do so . For some people it is real they have to sell to keep there heads above the water YES even in greenwich. I dont think anything Chris is saying is contributing to a downward spiral in the market. It is a buyers market like it or not thats the way it is . DEAL!!!!!!!!!

  24. sigma

    There is a distinct difference between maximum pricing vs distended price. Greenwich market @ $750/sq ft sounds like a medium to maximum price; however, $1,000/sq ft feels like a distended price.

    Sounds like the Greenwich distended pricer is doing a bit of funky marked-to-model instead of marked-to-market. Read your FASB 157 for guidance in valuing your assets at fair value at exit price.

    I think we can all learned from this distended pricing behavior that has infected us all.

  25. Hu Nhu ?

    From reading this blog it is clear to me Mr. Fountain is a rare bird–the honest, thoughtful broker. On that basis alone his blog is a very positive element of the Greenwich real estate market, because reliable information fosters confidence in— regardless the prevailing overall direction 0f — the market.

    More important, he’s dated all the Noel girls.

  26. Bill

    It amazes me how confused so many folks are… How is it that the folks here in town don’t understand that the economics have changed dramatically! I looked at about 7 homes this past weekend (for sale in town) – between 1.5 and 4.5 mil range and could NOT believe how unattractive the opportunities were. There is so MUCH more downside and its quite obvious when all is considered. I dont mean unattractive from a physical standpoint – I mean unattractive in the sense that prices don’t reflect reality. I was amused when brokers would say that the buyer is FIRM at this particular level… They can be a firm as they want but they will need to move 30% lower to appeal to any sensible buyer… One property in particular was amusing – It was a spec home on Old Orchard Rd – this home will not sell for 60% of what the seller is asking…