A couple of weeks ago I mentioned an E. Lyon farm condo that sold in the $8s after a year on the market and one reader complained that it must have been a distress sale and was thus unrepresentative. I didn’t think so and said as much, but here’s a second sale, this one in West Lyon Farm, Unit 521 that also started at $1.2 million a year ago and sold today for $875. Two may indicate a trend, don’t you think? The reset is on.
Daily Archives: June 11, 2009
In calculating spec house inventory (74 49 over $5 million) I use a construction date of 2007 as a cut-off date but that means my search fails to come up with houses like the one on Deseree (2005), 20 Dingletown (2004?) or this one on Cedarwood, which started construction in 2004. The builder paid $2.4 for the land it sits on back in January 2004, began building some time thereafter and has had it listed for sale since 2004 at ten various price levels, from a high of $7.950 million (June, 2006) to today’s new price of $5.450. It will certainly sell at some point and when it does, it will no doubt be cited by that optimist in the paper as proof that the speculative building market is gaining strength, but five years – and counting – to unload a project is doubtless not what this developer had in mind before he started out on his most excellent adventure.
It’s scheduled for Monday but this author thinks it will be continued, probably several more times. I suppose that Bernie’s not going anywhere anyway, but we do need some new developments in the case to keep things interesting. I wonder how the Brit’s investigation of money laundering by Walt’s son-in-law Andres Piedrahita is going?
$2.5 billion tax dollars spent by your government to find out which “alternative medicines” work. Conclusion: none of them. If I know my government, this utter failure will simply spur the expenditure of an additional $5 billion.
UPDATE: and here’s a compendium of Lunacies of the Left written by a Connecticut Florida liberal.
Over the years I’ve been a harsh critic of elements in the larger conservative movement and by proxy the modern Republican Party who pay lip service to various forms of pseudoscience, creationism being a prime example. But here we look at the other side of the coin with an incomplete survey of some of the bizarre anti-science beliefs, medical quackery, pseudoscience, and full blown conspiracy theories with questionable roots in science, some of which are sadly gaining considerable traction due to recent political shifts. They’re by no means held exclusively by the left, but nevertheless readers are far more likely to encounter them on progressive websites and liberal leaning celebrity talk shows and networks.
That eight unit development crammed onto 340 Valley Road has been suffering since its inception. The developer sold two units: one, originally priced at $2.7, sold this January (! And wouldn’t you like to know what the buyers agent told him to convince him to buy in a dead development?) for $2.360, the other sold last July for $2.3. As of yet another price cut today, the prices for the remaining units range from $2.250 to $1.8 million and, unless something unexpected happens, those probably won’t be the selling prices.
Widow’s $98 monthly Option/ARM mortgage payment increases to $3,500. Someone better start helping Granny pack. The gloom and doomers have been predicting for months that Option?ARMs were the next bad thing to hit the housing market as they reset at unaffordable levels and that’s what’s happening now. The indicted head of CountryWide Mortgage wrote some embarrassing – as in, this’ll put you in jail, fella – emails complaining about these, and admitting that their risk ws unfathomable. Hmmm.
On an otherwise uneventful day, 17 Edgewater Drive is reported as under contract after just 28 days, asking $1.795. It’s a nicely renovated (2000) house, and its short time on the market suggests that it went for close to its asking price, which makes it an exception to what’s been happening recently, because the sellers paid just $1.4 million for this in 2002. Someone’s making money! What’s interesting is that this sold for $1.649 in 2002 and then, under what I assume was some kind of pressure, sold again five months later for that $1.4. So these sellers got a bargain that year. Good for them.
More typical is the listing for 14 Hope Farm Road, purchased for $4,212,500 in 2004, relisted for $5.395 million in 2008, withdrawn that October and back again today at $3.995.
Even people not associated with the real estate business are noticing, and laughing at, minuscule price cuts. It’s nice to know they’re all reading my blog.
Connecticut has its own law regulating olive oil that’s stricter than federal laws. It was passed at the behest of one importer and now another importer is suing. I like my olive oil unadulterated, thank you very much, so I don’t sympathize with the plaintiff’s underlying cause, but the concept of fifty states with fifty different standards for any one product stifles commerce and was rejected, I thought, by our founding fathers. Dick Bloomenthal disagrees, and he may be right, but I think Connecticut has more pressing issues to worry about than this.
Greenwich and neighboring towns lose suit against FAA’s proposed change of flight plans. This is probably not good news (I really am not familiar enough with the proposal to form an opinion) but we live where we do, and where we live is a crowded little area with three airports around us. There will be noise.
Yesterday I received a snippy phone message yesterday from an agent, miffed that I had dissed his former listing for an abandoned spec house, now owned by a bank. Would it bother me to know, he asked, that the builder is ill with cancer and cannot finish the house because of that? There was more, but basically, the message was that I should take into consideration the personal situation of a seller before writing mean things about his house. I disagree.
As a human being, of course I’m sorry to hear of someone’s misfortune, but that has nothig to do with my job as a buyer’s agent. Of the three traditional “3 D’s of real estate”, death, divorce and diapers, two are occasions of sorrow, yet we all go on with the business of disposig of the house. I’ve yet to meet a buyer who wanted to pay more to help a widow or a struggling divorcee. To the contrary, I’m usually asked if we can use that tragic situation to negotiate a better deal. Now a fourth D has been added, “default”. I have met personally with many of the builders who are losing their dreams to the bank and they are, by and large, decent men who take great pride in their work and feel that they should be compensated for value they have put into their creation. And that’s a shame because in better times they would have reaped that reward. But these aren’t better times, for spec builders, and their woes, while unfortunate, aren’t my concern or my clients’. Sorry.
Yesterday I used the unfinished house at 20 Corrigan Lane (Road?) to discuss issues a buyer may face when considering a purchase: unkown quality of construction, hidden costs of completion, no warranty, etc. I received a thoughtful response, printed in the comments section of that post, from the listing agent, Juan Sosa, who answered those questions in a reassuring way. There are agents in town who, if they told me the sun woukd come up tomorrow, I’d wait 24 hours to see for myself. Juan is very much not that kind of person. So there is another factor to consider in this equation: the presence of the builder still in town, and a listig agent who knows answers to your questions. That is worth a great deal more than other abandoned jobs, where you are wandering in the great unknown.
An example of the latter may be the shell of a house at 26 Birch Lane, in middle Greenwich. So far as I know, the only contact is a person at whatever bank has taken this property back and hecould be in St. Louis. Wherever he is, he won’t be standing by to assuage your doubts. In this case, the house is, to my mond, worthless, and a bid should be at some discount from the land value, period. By the way – this house sits right on a small pond, directly across from another spec house that, while not abandoned, has yet to sell. The prospect of a deteriorating wreck across the water can’t help the latter.
Another real estate commentator reports that, “since April, 10 homes built since 2007 have sold or gone to contract”, and cites this as evidence that the speculative market is improving. Well, maybe, but I wouldn’t fire up those bulldozers just yet. Of the ten, one was listed at under $1.4 million – small potatoes in Greenwich – and five more had to have greatly disappointed their builders. 253 Round Hill Road, for instance, sold for just 66% of its asking price, $25 million. That’s still a huge sale, of course, but a disappointment, I would imagine. The other Round Hill sale, 451, started at well over $7 million, eventually dropped below the mortgage burdening the property and will doubtless sell below even that. A loss may be a sale, but …. 31 N. Porchuck was built in 2007, alright, but sold that year for $8 million and resold this year for $1.5 million less. 89 perkins was a badly-done redo of an existing house, was marked down something like 50% and, though still under contract, I’m sure will sell for less. Riversville Road sold for $4.775 million, perhaps enough to pay off its mortgage but representing the total wipe-out of the builders own cash sunk into the project.
Etc. So while we did have some nice sales of spec projects, including Andrews Farm for $8 million plus, the Rockefeller renovation, though not technically a new house, sold instantly for $23 million, and perhaps two more, if 6 out of ten sales represented a loss to their builders, other builders may find that discouraging.