15 Meyer Place
This Riverside home is directly on I-95. It’s ugly, on a noisy (okay, deafening) street and quite dated. Its original price was $920,000, its ( 2005 ) appraisal was $860,000, and it’s reported sold today at $560,000. I’m speculating here, but I’ll guess that the buyers are parents of young children who were willing to pay even that much because they wanted access to Riverside Elementary and Eastern Middle School, (plus, maybe., Tod’s Point.). In most towns, this place is a $100,000 house, at best.
But Greenwich no longer has an excellent school system and certainly not anything comparable to our competitors. Erecting a $29 million music studio at the high school will do little to correct this decline. We’re still better than NYC, where half the students are deemed “not college ready” and we’re certainly better than Syracuse, where only 1% of Spanish-American kids are, but those aren’t our competitors Westport, Darien, New Canaan – are, and we’re not doing a good job. Adding oboe rehearsal space isn’t going to cure that. I don’t know the answer to improving our schools, but I’m pretty sure building frills isn’t it.
Nationally, these guys say we have at least another 20% to drop. If California and Nevada are close to bottoming it’s because their prices have already dropped so far. Late bloomers, like Greenwich and New York City, were the last to feel the housing collapse and I, at least, think we’re still falling. You may disagree, in which case I invite you to come shopping for a new house with me. We’ll offer 95% of asking price, the (manipulated and deceptive) “historical” selling percentage in Greenwich, according to the realtor board, and I guarantee you’ll have your choice of every house out there, including Mad Monkey’s.
UPDATE: Miami isn’t Greenwich, although many of Greenwich’s more prominent felons end up there, but the logic of prices falling until buyers and sellers reach a balance would seem applicable here, too. And in both Miami and Greenwich, there is still a gross imbalance. Here in the land of Leona, we’re looking at at least a three-year inventory and as for $5,000,000 + houses, well, what are you doing in 2050?
Almost non-existent. We’re up to five single family houses going to contract for the month, which is awful. 80 Perkins Road, new construction by Jordan Saper, will close on Monday and the revelation of its selling price should be telling. Saper asked $7.950 million and in the past, a Saper house usually commanded close to full price. In the past. This time, I’m betting $6.5 high, $5 million, low. More on Monday.
There is another spec house closing next week, for an astonishing price. Can’t tell where or how much, now, but it’s going to be a lot of fun for some folks to laugh at, if they’re brave enough. I may set up another blog under a pseudonym and do just that.
The late Kit Wright’s Belle Haven home at 52 Pear Lane came up for sale today, listed for $16.5 million. It’s an acre and a half, direct waterfront with a deepwater dock (or so the listing says – I never looked), with a view more of Greenwich Harbor than Long Island Sound. It is a nifty cottage – as unique as its former owner – but I don’t know what the market is for a rambling little place that looks like an illustration from the times of Shakespeare. It was actually built in 1900, and the listing says it’s been “renovated at various times.” I suppose it has, although the last time I visited I saw no sign of renovations that I would have described as “recent”. Cool place though.
There was a neighbor, Egyptian I think, who lived in the original mansion for which this served as the gate house. He had a standing offer to Kit to buy the place back to restore the original grounds, but the fact that it’s being offered for sale would indicate that either he’s no longer there or interested or perhaps didn’t offer enough. In any event, his loss is your opportunity. Goldman boys need not apply, but maybe one of you hedge fund types described below in the Greenwich Avenue post as still having tons of money would like to jump in.
I spent a good portion of this weekend showing houses to two different families. There was one good house for each family -no, I won’t identify them here because they did like them and I’ll keep my mouth shut until they decide how they want to proceed. There were many more houses that were grossly overpriced and I didn’t have to tell my clients that. No buyer can see a house priced well at, say, just under $2 million and then walk into another house a few minutes later asking the same price but 1/3 smaller, much dingier, with an inferior location, without asking, “are these people out of their friggin’ minds?” Mad Monkey would have you believe that sellers who are cutting their prices are engaged in a mad dash to the bottom and will rue their haste, someday. Perhaps he’s right but if you want to sell your house in the foreseeable future, ask your agent to pull all the competing listings in your price range and neighborhood and then go see them. If you are capable of employing an objective eye and you see a better house priced lower than yours, cut your price. Right away.
I think that our market is still being filled with new listings that are over-priced. Part of that is the refusal of sellers to get real, some can be attributed to agents “buying” a listing by deliberately lying to would-be sellers (okay, let’s use the softer term and say, “letting their optimism get the best of their judgment) and, in some small part, the complete lack of certainty of what’s coming at us. I was at a house today with another agent and, after we’d seen the place and were walking back to our cars, I said, “asking price should be $500,000 less: $2,495,000.” The other agent, a very good one, said, “oh, no, that’s much too low,” so I asked her what she thought it should be priced at and what it would sell for. After a certain amount of consideration, she finally concluded (a) that it was going to be on the market a long time, (b) that maybe $2.650 was a better asking price, and that it would probably sell at $2.495. So she ended where I began – my guess, today, is that it will sell for $2.3 million but here’s the rub: neither of us know. Not long ago, I could make a pretty good estimate of a house’s value, with the occasional whopper of a miss. Today, I’m sort of, kind of confident about guessing present value (limited, of course, by the lack of 15 recent nw to use) but I really have no idea what the market will look like in June. My fear is that it’s going to look really, really ugly. But I don’t know that.
So I’ll keep an eye on this place and report back when, and if, it sells. Then we’ll know.
Just to follow up on the last post, here’s what I’ve learned from the buyers I’m working with – and I suspect mine are typical: they have absolutely no intention of offering full asking price, especially for new listings that haven’t had time to mellow. They (and I) shy away from listings with ridiculous prices; they don’t even use them for comparison purposes because they are comparable only to other over-priced houses, which is useless knowledge. But even you, wise seller that you are, who have knocked your price down by hundreds of thousands (or even millions) of dollars should not expect an offer that comes close to your desired price. It’s not happening.
Okay, that was the broad brush approach, and there have certainly been a few exceptions, but I hate to give you that out because, invariably, any seller reading this will say, “well I’m the exception!”. Chances are, you’re not – we just aren’t as special as we’d like to think we are.
Spain’s debt downgraded.
Stocks in Europe, Canada and Brazil decline
EU drops economic outlook for 2009
Fiat threatens to return to U.S.
These four headlines were just collected from today’s news (alright, the last one about Fiat is, although true and undoubtedly frightening confirmation of our impending status as a Third World country,, mostly included as a joke). Just as gloomy news was around last week, for those who bothered to look, but you’d never know it from current real estate prices. I was working this morning on finding some reasonably priced properties and was struck, yet again, with how many sellers are still convinced that their houses and land have increased dramatically in value since 2006. What are they drinking?
I would guess that these people are just holding on, part of the mass-hysteria that believes that the Obama will pull the country from its economic malaise and return us right quick to prosperity. Last through the spring, the reasoning goes, and we’ll be back where we were when times were good. Even the EU itself seems to believe this – its depressed forecast for 2009 is followed by a stated belief in a come-back in 2010. This might be more encouraging if today’s communication hadn’t been issued to correct its more optimistic forecast made just two months ago. If they can’t get it right over 60 days, do you trust them to predict accurately what conditions will be like in 450?
I don’t wish to add to another hysteria, the one that fears the sky is falling, but if I were trying to sell my house now I would price it based on an assumption that property will be worth less a year from now, rather than more. Certainly, that’s what buyers are figuring. If you and the buyer aren’t on the same page of that expectation, there will be no meeting of the minds and no sale. So either reduce your price and sell, or pull your place from the market and wait for the rebound that will prove buyers wrong.
Or just keep your house in showroom condition and let tire-kickers disrupt your schedule. Some would-be sellers are happy with seeing that kind of activity because it lets them pretend that something’s happening. It doesn’t work for me, but we’re all different.