Depends how you see things

Half full or half empty, depending on what that clear liquid is

Half full or half empty, depending on what that clear liquid is

The Mickster, always a cheerful chap, writes that January has seen $300 million in “sales and accepted offers” and says that’s evidence that the market’s booming. Whatever

There were 80 single family homes that reported accepted offers this month, and their asking prices, and inventory left, breaks down as follows:

<$1 million: 20/44 (20 sold, 44 still to go)

$1-$1.5:  14/42

$1.5-$2: 13/55

$2-$3: 15/68

$3-$4: 5/58

$4-$5: 4/31

$5-$6: 2/28

$6-$7: 3/21

$7-$8: 3/12

$8-$9: 1/11

$9+ : 0/49

Make of that you will. Also note (a) asking isn’t getting, and (b) some of these sales reflect some serious markdowns. Mohawk Lane, for instance, reported as having an accepted offer, last listing price $5.450 million, sold new in 2008 for $7.5 million and has been up for sale since 2009, when it started at $7.850.

And finally, our inventory of 451 homes is a typically low January supply – the next three months or so usually sees another 150 new competitors. The good news for sellers with stale listings is that almost all these new listings will be way overpriced by agents eager to get the business and clueless owners, so yours won’t look quite so bad.


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20 responses to “Depends how you see things

  1. InfoDiva

    When trying to arrive at some approximation of value, is there any point to using assessed value these days? I know that the ratio of sellling price to assessed value varies all over town–with Riverside and OG leading the pack–but within a certain school district, for example, is it safe to say that a house should sell at about X times its assessment? Or is the assessment really meaningless, except of course to the folks who collect the money?

    • Info, I’ve said this before, and nothing’s changed my mind, yet: our assessments can be a good guide to value but should never be relied on as some ultimate arbitrator. They’re done by professionals so they at least start off well with a basic valuation structure, but I think the nuances escape the system. From the town’s revenue perspective it probably doesn’t matter all that much because what’s missed on one house may be picked up by the next, but for the individual homeowner a bad assessment can be good or bad, depending.
      So my advice is not to ignore the assessment – it may be spot-on, but do your own comparison, because these numbers range from spot-on to crazy low, or high. They’re a tool, often useful, but should certainly not be considered the final word on value.

  2. Mickster

    it must ADHD – I clearly, or so I thought, said $300Million in sales in the past EIGHT WEEKS (Dec and Jan) – I believe it was $210Million+ in December and $81million+ in January so far…
    The 80 or so accepted offers and contracts for January, I believe I read on your brother Gideon’s site.

    WE”RE BAACK !!!!!
    Money is starting to flow again.
    Get your house on the market.
    Buyers are lined up!

  3. The New Normal

    when real interest rates are negative, and everything else in the world is being bid up, why wouldn’t houses eventually follow?

  4. Cos Cobber

    this is all about two things: 5 years of pent up demand to finally get off the sidelines and comfort that washington will keep printing $$ and the eventual doom which will come from that is still a few years away.

  5. GreenITCH

    CF while a dose of reality is always good for the market .. you seem critical of the fact that ” b) some of these sales reflect some serious markdowns ” .. so what .. yeah the market is not at its peak .. nor even near it but sounds like a healthier market and you are the first to lament about sellers miss pricing their homes …. so why not be somewhat enthusiastic that stuff is once again at least selling

    • I’m delighted to see house prices draw closer to reality – I make a living selling them, and I can’t sell an overpriced home. I’m just wary of the existing inventory, the shadow inventory and the lack of interest in most buyers in what we have in inventory, which is old housing stock. Many of these houses are beautiful examples of the builder’s craft as practiced decades ago but much as I like and appreciate them I’m not a buyer, and those who are buying seem to prefer homes that were built in their lifetime.

      • The New Normal

        in reality, you make the vast majority of your living helping buyers buy homes, not selling them

        therein lies your bias

  6. Anonymous

    Are you defining “shadow inventory” as people wanting to sell, but not yet ready to accept reality?
    And if more people are looking in the 3-4 million dollar range in the golden triangle, wouldn’t shadow inventory be a good thing to shed some light on, rather than fear?

    • Shadow inventory, as I’m using it, are houses whose owners can’t afford to sell because they’d have to bring cash to the closing table and they don’t have it. Those owners who have stopped making payments on their mortgage will, maybe, eventually lose their homes – the cure rate for mortgages six months delinquent is just about zero – but not any time soon. We’re closing in on four years to foreclose a mortgage here in the land of steady habits and I doubt we’ll see a reversal of that trend.
      All that said, there are a number of people out there who’ve been riding out the process for 2 and their time is close to being up. When it is, the banks will end up owning a fair portion of Greenwich real estate that they don’t want. Self interest should prevent complete fire sale pricing, but if an investment group has paid, say, $0.60 on the dollar for a bank’s portfolio of bad loans, they’ll be able to sell at a price the original borrower could not.

      • North St Owner


        That some MAGIC mushroom you ruminating right there!!!!

        Once you’re back from that wild trip, try reading your post again with total honesty.

        With interest rates rebounding from historical record lows, buyers sitting on the sidelines and burning with high rentals will rush to buy whatever is left from our stale inventory during Spring.

        Fear is a bigger motivator than greed. Fear of losing the timing on the 2% mortgage deal is enormous!

        Reat assured: Fresh new inventory will sell like hot bread. Coupled with the current scarcity of land in Greenwich and the rush to lock in rates will probably cause good properties to rebound to 2004/2005 levels — at least 10-15% higher from where we finished in December.

  7. Anonymous

    Cannot imagine why any bank would sell loans on high end Greenwich real estate for 60 cents on the dollar. The stock market is back up. New York City real estate is climbing back to its high and almost there. Greenwich will follow in the next few years. The banks that wait the 3 years or so it takes to get back to the high will clean up on penalties and interest. Alternative investors are buying single family houses in bulk because they expect to make $$$.

    • Ah, because high end houses are a drag on the market, inventory is stagnant, and banks don’t want to be in the home maintenance / rental business? Those are reasons that come to mind.

      • Anonymous

        Looks like there are ample buyers up to a certain price range. The house would have to be pretty high end to really be a drag. Under $4 million, anything should be saleable longer term. It starts with the inventory being very low under $1 million and moves up from there.

  8. Anonymous

    I am shadow inventory too. My house has a big gain because I have owned it so long. Need to hold till I die to get my money out.

  9. Anonymous

    Don’t discount the hold till you die problem. There is plenty of that holding up inventory in Greenwich and it will only get worse. A full third of the value of my home would go to capital gains taxes if I sold.

    You are also going to have people who have refinanced their houses enough so that they cannot afford to pay the capital gains tax on sale. That would sure hold up a sale and postpone it till death.

  10. Mickster

    We also have to remember that, especially in Greenwich, there’s a difference between being “in the market” and “on the market”, the latter being homes that are either a) listed at “make me move prices” or/and b) I need to get this price to pay off my lender. Those houses will still be on the market this time next year and the year after.

    On the other hand, homes “in the market”, when they don’t move initially, have their prices reduced over time and eventually sell, when price meets market..

    Any dumb-ass, with a good realtor, can distinguish which category any listing falls under.

  11. The New Normal

    you have b.s. make-me-move inventory because it costs nothing (except a little inconvenience) to list a home for sale

    charge them even a nominal amount and some of that inventory probably disappears

  12. The engineer’s perspective: The glass was designed to twice the necessary specification.

    (Where’s that crystal ball? Ah!) OK, let’s see here…….

    The point being, “we’re baack” is likely never to arrive in this generation. The ideologies of the local, State and Federal powers that be are hostile to wealth and their policies inimical to it’s creation. This is the new normal and this… is temporary.

    On the other hand, in the short term, private investors are seeing the weakness in market fundamentals, globally and domestically: Bonds suuuuck, the economy is contracting and the Feds are killing commodities. Some liquidated cash will make a run – for a while – into real property, stock and the like.

    Until the re-set. At which point, the glass’ specification wil need to be reconsidered yet again. (My, what a cheery outlook today, huh?)