So much for open houses

Nothing to write home about – retreads and an overpriced home or two and that was that. It happens, especially during weeks when schools are out and anyone with a life has left town. But, and not to suggest that they don’t have a life, I did chat with two of the best agents in this town and we all have the same complaint: no inventory.

We have buyers, we’re all getting emails and phone calls from them expressing pretty much the same thing: they’re ready to buy, they want to go out and look at more houses, what’s come on that’s good? And we’re all giving the same answer which is, nothing, and anything new that does show up is overpriced – the only thing to do now is to wait.

All of which is frustrating, of course. According to the Greenwich Multiple Listing Service (GMLS) there are 420 active listings for single family homes right now, in all price ranges, so you’d think that between a flood of able, willing and ready buyers and all those properties some matches could be made and, of course some are. But for the most part those houses have been shown and for whatever reason they aren’t selling. As always, I’d look first, perhaps exclusively to price because in Greenwich, nothing can be so wrong with a house that the right price can’t cure.

If I were a home seller whose house hasn’t sold I think this would be a good time to sit down with my agent and have a serious discussion about price. Right now there’s a large pool of eager buyers who can’t find anything to buy – if they’ve looked at your house and passed, and they have, it’s because they don’t think it offers the right value. In a month or two more houses will come up for sale and will be competing for those same buyers. It’s certainly possible that the fresh inventory’s prices will be so high that your own house will suddenly look attractive; in fact, that often happens, but if you want to be sure of selling your house and want to end the process now, talk to your agent and figure out what price will make your house stand out, rather than continue its bland existence as just another one of the overpriced choices currently going nowhere.

As an aside, I noticed just now that Shore & Country has stopped providing its excellent market statistics, which is too bad. But Raveis still does and the data is still readily available. Check it out here.

UPDATE: Shore & County does still provide the data:

Hey Chris – Russell Pruner here – we still have our most accurate Greenwich Market Stats you just couldn’t find them at our new website – ShoreandCountryProperties Here is the link if you need it –




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32 responses to “So much for open houses

  1. The New Normal

    or maybe buyers will blink, reach into their pockets, and pay higher prices

    • To a modest extent, Normie, yes they will. But they haven’t gone past the blinking stage to the blindfolded, bent-over position that sellers seem to think is appropriate.

    • D

      Interest rates have been inching up since last summer – if a buy has kept their price target, they are already making a concession.

  2. Anonymous

    Pay up or move somewhere else.

  3. InfoDiva

    So what makes the market for this commodity so different from every other–scarcity = higher prices? Or do the basic rules of economics apply only to properties in Riverside and OG these days?

    • As I see it, there are a lot of factors affecting prices, Info. Scarcity, yes, and the scarcity of land in particular sets a ground floor, if you will, on how low things can go – the worst house is still worth its land value. But the slowly falling prices of the $5 million and up inventory is exerting some downward pressure from the top, so prices are being squeezed. Add in the availability of rentals, the option of buying up the coast, even in Westchester, for God’s sake, or just staying put in Manhattan and you get another thing to consider. Then calculate rising interest rates because except at the highest levels the price a buyer is willing to pay ultimately depends on the monthly payment – more to the bank means less to the seller, and vice versa.
      So it’s all very well for the owner of a $1.375 crappola house to price it at $2.250 and say, as a reader already has, “pay up or move on”, but arrogant posturing doesn’t do much except provide an opportunity to do some macho chest undoing, and look where that got King Kong.

  4. It’s not possible. GAR has has assured me that every home on the market in Greenwich is perfectly priced and a fabulous value. It must be those scurrilous buyers conspiring to deprive sellers of their rightful compound growth rate in asset value. Damn their eyes!

  5. Anonymous

    I’m as pessimistic as the next guy, but the financial markets are starting to exude confidence. Lots of recent M&A (Dell, Heinz, AMR / US Airways, NBC Universal), stocks are at a five-year high, and, in some cases, this is not dumb money on the buy side. This confidence could easily spill over into real estate.

  6. Anonymous

    Not sure about this. The higher end in my neighborhool in midcountry ran at a $1 million premium over the cost of land plus building during the boom. Sort of crazy pricing. Now it is closer to cost of land plus construction for the higher end unless the builder went overboard in spending on the interior. A seller should not get a huge premium for renovations, but in hot markets the premium is right there.

  7. Anonymous

    I can’t wait to sell my midcountry estate for a higher price thanks to Warren BUffet buying a lot of catsup. Or is that ketchup?

    Oh wait, no, I meant home prices catching up. Sorry, my confusion.

  8. KMA

    I guess seller are right to wait, assuming they’re in no rush to sell. Prices are going up. If Mr. Buffet is buying Heinz for 14 times cash flow and funding it with a 9% div preferred in Greenwich should go up too. why not. To all those buyers..wait or be priced out and rates will go up in your face too. Good luck out there.

  9. B

    Yes, there are a few people with a lot of Heinz stock who will soon be able to purchase large houses in midcountry. Fortunately for us, that would be too far of a commute for John Kerry.

    Elsewhere on the planet, banks are laying off, taxes have gone up (for some of us at least) and more is promised, interest rates (as noted) are going up, everyone is REALLY nervous about the economy that used to grow at 3.2%/year but now can only squeak out 2.2% with no rebound from the recent crash etc etc. Yes, buy buy buy…

  10. Ach

    I’m not sure sellers are reading the right headlines in the newspapers. Wall street it’s reducing it’s size fastest than in 2008/9, The Dodd-frank regulation it’s going to cost thousands of jobs. Basel III will make virtually impossible for banks to make money. Regulators want less pay and more taxes. I believe buyers just want a pay a decent price. If the house next door sold for 500 $/sqft, why the next seller want 600
    $/sqft for a similar year/land/sqft when the house it’s been in the market for over a year????

  11. Anonymous

    got a pal high up in the banking biz. they’ve been laying off scores of 250k-500k/yr folks, as well as the 1mm guys. the latter two are the greenwich buyers in the 4x gross purchase price range. not now.

  12. Anonymous

    Hey Chris – Russell Pruner here – we still have our most accurate Greenwich Market Stats you just couldn’t find them at our new website – ShoreandCountryProperties Here is the link if you need it –

    • That’s great, Russ – thanks for the correction – I’ve made the correction even more prominent than my error, I hope. You guys provide a real service with that information, for consumers and befuddle bloggers alike.

  13. The New Normal

    with all due respect and sympathy, those being laid off at the moment in financial services are 1) under- or marginal-performers, 2) employees in businesses that are being made redundant due to profitability or corporate strategy, 3) people involved in areas with regulatory issues, 4) people looking to leave financial services (asked to be considered in Reduction In Force layoffs i.e. voluntary retirement), usually due to change of heart about working in the industry

    #1 were never people who were going to move the needle in terms of house purchases except at the margin in extreme bubble circumstances like 2005

    #2 is a fact of life in the corporate world – companies are constantly evolving

    #3 is not unexpected – people have known about implications of Dodd/Frank and Basel III for almost 4 years now

    #4 are leaving for greener pastures – if there is such a thing

    most of the above layoffs are expected and “priced in” in aggregate from an individual’s perspective for those working at banks: if you think you are on the bubble, you were never seriously looking to splurge on a house purchase in Greenwich to begin with – you’ve been retrenching for years now just hoping to save enough to get by

    but look at the reality: JPM reported record revenues and earnings for 2012, GS 2012 net revenues up 13% y/y, Bank of America tripled 2012 net income of ($4.2bln) vs 2011 ($1.4bln); Wells Fargo record 2012 net income and revenue up 6%; banking stocks were some of the best performers in 2012 and off to a very strong start in 2013; the banking industry, while in secular decline long term, has troughed cyclically in the short term; and in reality, the best performers at banks are now paid substantially more than the marginal performers

    things are really not that bad in banking overall – it can be if you are in the bottom 1/3 of performers with few career advancement opportunities; but as to how it really applies to Greenwich real estate at this point in time it is a bit too late to be bearish due to “layoffs” that have been occurring for the last 5 years and that have most likely peaked

    • From your previous comments here about real estate, Normie, it sounds like you’re desperately clinging to the notion that bad things only happen to the sub-strata, that hard work and intelligence will always prove out and that which was once true will be true always. To me, it sounds like you made a bad trade, bought a house at the peak of the market and are determined to bring its price back up to where you came in. My suggestion is that you take advantage of those corporate health benefits while you still can and see a psychiatrist to help you recognize and admit your pattern of denial. Then you’ll be able to accept what has happened to you and “move on to greener pastures”. Good luck.

      • The New Normal

        America is a place where people can reinvent themselves

        Even if one is made redundant (whether it be due to regulation, obsolescence, poor performance) you can always come back through determination and hard work

        Do people sometimes get unlucky? I would argue that luck plays a huge role in the short term, but for 99% of people they are where they are supposed to be in the long run (over a 15-20 year career)

        In reality, a lot of laid-off bankers are having a hard time finding jobs because they are looking “equivalent” work – they will not settle for a job that is not similar in salary or responsibility. There is plenty of work for people who face reality and take a step back in title/compensation, knowing that they are rebuilding a career – they will overqualified and underpaid, for a short time, but if they are really cream then they will rise to the top.

      • The New Normal

        The nominal prices of real estate in the US, perhaps excluding areas in secular decline that will never come back (Detroit) or bubbles that were a pipedream (Las Vegas) will eventually return to the highs, it is only a matter of time.

        For Greenwich, whether it takes 2 years or 15 years, it doesn’t really matter unless one needs to sell today. Seems like some areas in Riverside and Old Greenwich are making new highs already.

        I find it interesting that you are so conservative and libertarian in your politics (views which I tend to agree with) and yet don’t recognize that “hard work and intelligence will always prove out” at least when we are talking about the universe of people who are potential or existing Greenwich homeowners (the top x%).

  14. Anonymous

    new normal, your post at 5:29 covers just about every banking position. nice job of providing clarity….

    you must be a risk management guy, never had p&l line mgmt. responsibility in your life (or in simple terms, not responsible for bringing in revenue). in my years of banking, i’ve often found that your ilk fancy themselves the ability to say no and would, in general, prefer that the company they work for, whose business is [x], to just simply stop doing [x] and have nothing but risk managers and IT folks guarding the doors.

    problem with that is, well, when you’re in business to do [x], and you’re no longer doing [x], then you’re…wait for it….gonna get laid off faster than you can say, “we need to think about the impact of basel 3.”

    • ShedLessToolMan

      Anon 10:05,

      I somewhat agree with your sentiment that new normal was a secondary player in the financial industry based on his commentary. He throws around plenty of financial markets jargon and quote many different financial publications… I do watch some CSI and Matlock reruns and I fancy applying my ill learned craft. I believe new normal has already been downsized or laid off based on the time and frequency of his posts. Moreover, If he had a position of any power or responsibility and continued that during his time off he would be busy trading and doing research and looking for the next job or writing business plans. Instead, he is on here trying to talk up Greenwich real estate so somebody will buy his overpriced house most likely. I would guess he is sitting around watching Bravo reality shows and eating malomars while thinking up new ways to spread bullish propaganda regarding unrealistic property valuations to distort the minds of CF’s readership. New Normal, when you drop your house 35% and it sells, then will you change your mantra and start posting from the real estate is all too high angle?

      New Normal, why can’t you be more like Russell Pruner and actually provide useful comments and tools to help people without your own slanted bias? (btw, thanks Russell,that is a great resource).. anyway, in the shore and country outlook they talk about smarter buyers with greater access to deeper information through internet and more easily available documents and so forth.. It gets harder every year to misprice (over price) and sell a property as the market is becoming more efficient through better, faster and more accurate information available easily to all..

      Anyone with enough money to buy in greenwich should be smart enough to either do their own due diligence or have somebody else do it for them. . That is why you hire a broker like CF, you actually get a real estate education and a law degree protecting you in this case.. double threat.. compared to a new normal equals zero threat..


    • D

      Smells like credit committee to me!

    • The New Normal

      not sure why you would even care to speculate, but my “ilk” is not what you think it is

      what I wrote is just reality – I realize I may have struck a painful nerve so let’s just leave it at that

  15. Anonymous

    way back in the dark ages, i used to have to prepare credit committee memos for transactions, some of which (depending on deal size) went right to bob rubin. while i have absolutely no idea if true or not, smart man that he is, he probably never opined on any of them officially. given his teflon-like stature in the industry, his inner mantra towards fellow credit committee members was probably “i’m rubber you’re glue whatever i really think about this deal will never be memorialized and all the blame will instead be passed on to you!”

  16. Anonymous

    12:13–update that FRAC, baby!

  17. eb

    Well, this is my take on it having looked in Greenwich for a year. The lack of market turnover is scaring people off. Certainly the houses are overpriced for the market, and to risk going into back country and not being able to sell your house for three years is scary. These are difficult economic times, and houses are a big chunk of asset. If I lose my job, I want to be able to sell in a reasonable amount of time without taking a huge loss.