From Indiana comes this tale which suggests that Greenwich does not hold a monopoly on dummies. That’s reassuring somehow, I suppose.
Read about your blog in the NYT. We have observed similar real estate phenomena in our house hunt in an isolated, relatively poor, and fairly uneducated (local high school only graduates 56% of students) city in Indiana (job brought us here). I can sort of understand denial in more desirable parts of the country, but here I find it especially hard to swallow. A few recent kickers:
Agent A confronted our buyers’ agent asking her why we were viewing homes “out of [our] price range” at open houses. The context: we viewed one of Agent A’s listings and told him it was a nice house but it had just hit the market and we were going to let it “simmer” a bit (you think he took offense at that?). Wonder why he thought it was out of our price range when a much nicer local home recently went for $50,000 LESS than the asking price for Agent A’s precious listing?
We made an admittedly low-ball offer on a house that has sat on the market since July 08, has been empty for months, and has owners who are “working with the bank” (to quote the listing agent). Their counter offer? The asking price. Hmmmmm.
My husband’s fine research revealed that “new price” on one home actually meant a HIGHER PRICE than the previous month!
We’ve also been dismayed, but not surprised to see that Unappealing Houses C, D and E have miraculously gone from hundreds of days on the market to 1.
It’s 2007, real estate woes are begining to afflict the rest of the country so Greenwich Time Post (just before they hired me, I hope) sends out its best reporter to interview real estate agents about the state of affairs in the old home town. The conclusion. Things are great, never better, and will stay that way forever and ever, amen!
Feds are back with no-money-down mortgages! This will solve the problem of homelessness, bring a sense of dignity and worth to the poor and clear up our housing inventory which, for some unkown reason, has fallen into a ditch recently. I’m glad someone’s thinking down there in Washington.
Chris Craft Mortician Service
Funeral home shut down after dismembering corpse to fit in casket. Hey, the jerk was 6’7″ and he pre-paid for a normal length coffin – what did he expect? Every home builder knows that change orders will cost an arm and a leg.
The FDIC has (scrapped its plan to rid banks of bad loans because it couldn’t persuade the banks to go along. It is possible that this reluctance can be attributed to the growing confidence of lenders that their crappy, underwater mortgage loans are about to leap out and fly, but I suspect it has more to do with their fear of acknowledging their fatally weakened position.
In a move that confirmed the suspicions of many analysts, the agency called off plans to start a $1 billion pilot program this month that was intended to help banks clean up their balance sheets and eventually sell off hundreds of billions of dollars worth of troubled mortgages and other loans.
Many banks have refused to sell their loans, in part because doing so would force them to mark down the value of those loans and book big losses. Even though the government was prepared to prop up prices by offering cheap financing to investors, the prices that banks were demanding have remained far higher than the prices that investors were willing to pay.
In a statement, the F.D.I.C. acknowledged that it had not been able to get banks interested in its so-called Legacy Loans Program. Scheduled to start later this month, the pilot program was aimed at selling off $1 billion in troubled home mortgages.
F.D.I.C. officials portrayed the change as a sign that banks were returning to health on their own.
“Banks have been able to raise capital without having to sell bad assets through the L.L.P., which reflects renewed investor confidence in our banking system,” said Sheila C. Bair, chairwoman of the F.D.I.C.
But some analysts said the banks’ reluctance to clean up their balance sheets meant they were merely postponing their day of reckoning. Indeed, some analysts said government policies had made it easier for banks to gloss over their bad loans.
“What’s happened is that the government’s programs have addressed the symptoms of the financial crisis, but not the cause,” said Frederick Cannon, chief equity strategist at Keefe, Bruyette & Woods, which analyzes the industry. “The patient feels better, but the underlying cause of the problem is still unaddressed.”
Two properties whose price and sales histories have not been cleaned up (yet) expired unsold today, for the very good reason that they were over-priced (attention B.J. O’Rourke, lawyer attorney and member of the bar: the marketplace determined that conclusion, not I).
12 Doubling Road, originally a 6.68 acre parcel with a great old, tired house on it was listed in ’04 for $14.5 million. The house and 3.75 acres of the land it sat on were carved off and sold for $7.575 in ’05 and the remaining land met a similar fate in 2006, when it sold for $4.130. The house was renovated and put back up for sale at $13.5 million last September and never dropped its price, despite the resounding silence of the market to its presence. It expired today and whether it will come back again or the owners have decided to stay put and enjoy the work they put into the place, time will tell.
A ridiculous example of over-pricing, 54 Rock Maple Road (off Stanwich) also expired today. Purchased new in 2002 for $5.3 million, the owners made no improvements worth mentioning yet put it back up for sale in September, 2007, at $11.750 million. When I speak of houses that aren’t seriously for sale, this one comes first to mind. Five price-cuts and two or three brokers later, it finally reached $6.950, which would probably have been a good place to start two years ago. Now that it has sat and been laughed at since then and the market for homes in its price range has evaporated, I predict an out-of-pocket conclusion to this sales experiment.
37 Carrington Road, a Greenwich address/Stamford property came on the market today asking $1.295. That’s a sensible price and I was pretty sure it’s the price I recommended almost four years ago when it was first offered for sale but, when I went to check the sales records, I found none. Different house, faulty memory? Perhaps, but either my memory is rapidly deteriorating or there are an increasing number of retread listings out there that are showing up with their history slate wiped clean. If only our personal lives could be cleared up so easily.
Hotter than our sales are, certainly. This listing on Park Avenue in Old Greenwich was asking $6,900 per month and is reported this morning as rented for $7,500. There have been a number of over-ask rentals recently and, while I have yet to pull them together (later) it appears that there are more renters out there than houses. That’s good news for home owners if their carrying costs are low enough.
Big houses,big price cuts in Greenwich, per the New York Times and its ace reporter, Peter Applebome. Some see light immediately around the corner (that would include my optimistic brother Gideon, judging from his recent comments), others are a bit more skeptical.
The optimistic case is that most sellers are hanging in there, plenty of houses are selling near the asking price and things will bounce back as they always have.
“We’ve become extremely busy lately, wildly busy,” said David Ogilvy, whose firm lists many of the top-dollar houses, like the Helmsley estate. “We’re not as productive as we’d like to be, but you can look and see the same thing has happened before. I think we’re at the bottom now. We may bump around for a while, but I think we’ll be up between now and the end of the year.”
The pessimistic case is that it’s hard to figure out who can afford the empty castles of Greenwich.
“We used to know who would buy those houses — it’s hedge fund kings or someone from Lehman Brothers or old money,” said Frank Farricker, a real estate agent and the secretary of the Planning and Zoning Commission. “Nobody knows who that guy is now.”