Statistics

A total of 260 single family houses sold in town this 3rd quarter, compared with 299 in the same quarter last year. Once again, nothing was sold (or available) for less than $400,000 – surprise! On the other hand, we saw a significant increase (28 vs 20) in houses sold for more than $5,000,000. In the $2-3 million range, 41 houses sold this quarter against 53 last year (there are 8 more that went to contract but have not yet closed this quarter). You might think that inflation just bumped more houses into the next category, but no: 26 in the $3-4 million range this year compared to 24 last. Go figure.
So is a 14% drop in houses sold significant? Probably – not quite the headline grabbing news mainstream media would have us believe, but certainly evidence of a cooling market. So price your house right and don’t count on a rising market to help you achieve your dream price.

Smart House

My former law colleague turned builder Peter Thalheim is putting the finishing touches on a new house at 151 Riverside Avenue and I’ve been enjoying watching his progress (even if he did list it with our mutual friend, Bill Fossum). The house itself is gorgeous, with Brazilian cherry floors, coffered ceilings, six bedrooms and all the trimmings but something else sets this house off: Peter designed and built it to be super energy efficient. It’s been qualified in the CL&P “Energy Star Program” which, in return for a builder installing and employing all sorts of energy saving devices and construction techniques, provides some fairly modest cash credits and certification to the building’s buyer that he’ll continue to save money over the years. Peter used the Icynene foam insulation system (link on my weblog) which is a vast improvement over fiberglass batts because it fills every nook and cranny and, unlike fiberglass, can’t be cut, pulled out and shoved aside by the trades when they install plumbing and wiring. So no drafts or air leaks, plus sound-deadening qualities and no mold. Energy saving is estimated by Icynene at 50% and nothing I could find on the web contradicted that; in fact, all the articles I could find praised the product and its performance. Peter has installed two, two-speed Carrier furnaces (they don’t have to run at full speed when its not necessary) which carry an efficiency rating of 90+ % (old furnaces were 65%), a tankless hot water heater, low “E” argon filled windows, etc. etc. All of these features cost extra money and when I first toured the house last spring I applauded the effort on environmental grounds but wondered customers would consider them a selling point. Now that we’re facing a 50% increase in heating and cooling costs, Peter is looking pretty smart.

Pricing

Many sellers seem to establish the selling price for their home by looking at their basis, deciding how much they want to net and, after building in all the transaction costs like taxes and commissions declare “voila!” and a price is born. That’s fine but, sadly, their desires don’t dictate price: the market does. All the color brochures in the world and all the full page advertisements in the paper will not sell your house for more than the marketplace decides it’s worth. This simple truth, so easily understood in general, seems forgotten in the emotions churned up by selling something so personal as a home. But it’s true, all the same so, if you want to sell your house, work with a realtor who is thoroughly familiar with market conditions and follow her advice. Of course if you really don’t want to sell but just want to open your home to a (steadily diminishing) stream of lookers, then you just set that price anywhere you want.

Get it Right
I was behind an SUV in Riverside the other day and noticed that its license plate frame proclaimed the driver to be a “University of Connecticut Alumni”. As a graduate of that fine university’s law school and the nephew of the last man to deliver Yale’s Valedictorian speech in Latin (Dr. Gerard Fountain, Yale 1936? ), I was a little embarrassed for my school. Unless both the driver and his spouse were UConn graduates, the plate should read “Alumnus”. Which is all the Latin I know.