Here's a great comment on selecting an agent that makes a lot of sense (because I didn't write it!). I didn't want it to get lost in the shuffle so I reprint it here.

"Though I agree with some of the techniques Chris mentions in scoping out the "better" agents, I have to say that elevating this town's handful of good brokers to a level of consummate competency is unfair.I had used a couple of the "power" brokers in Greenwich on different occasions and found them to be too busy and/or scattered to pay me the kind of attention that I felt I deserved. They have too many listings and clients to manage with equal effectiveness. I eventually went with a lesser-known, non-veteran agent who has been wonderful. She appears to be among a large group of serious agents in Greenwich who are hungry for business but seem to be edged out by the veteran agents who rule the market -- just because of their reputations. And not all of these veterans have favorable reputations on the street. I'd rather deal with someone who is smart and sincerely a hard-worker (even if he/she is not a veteran) rather than a tired, pushy, elitist."

Too bad greenwich doesn't permit for sale signs by Realtors. This one makes sense.

A quiet morning, but check out the comments section - there are a number of discussions going on.

I suppose we can talk about the latest tale of wayward boys causing trouble at the high school. According to the Greenwich Time's sanitized version, five "high school football players" tossed eggs at a coach's car over the course of several nights. The coach eventually took down their license number and handed it over to the police, then resigned presumably, the GT would have us believe, out of disappointment over the actions of his players. The true story or I should say, the rumored story, is, as usual with our local paper, far more interesting.

According to rumors, and some of these originate from people who should know, the egging crew included two co-captains of the team and they all pelted the car four nights running. The coach lost his cool and lay await for them on the fourth night, then engaged them in a high speed car chase across town to Byram or, if you prefer, across the Tappen Zee Bridge. Either way, he called off the pursuit, turned in the license plate number and was then fired from his coaching duties because his reckless actions had endangered the lives of the kids (who cares?) and any innocent by-standers who might have wandered into his path (that I do care about).

The kids, again rumor has it, although the school denies it, were ordered to run some laps and the matter would have ended there with one fired coach and five sweaty kids. But grumbling arose over the lack of punishment - the kids will continue playing with the team, for instance - and the perceived special treatment accorded star athletes. So yesterday our Superintendent announced a new round of punishment will be meted out, albeit without specifying what that punishment will be. I'd guess it will be a form of "super secret double probation" but what I'd like to see, just to make clear that budding pigskin tossers are treated no better than chair kickers, is them marched to the center of the football field, Tasered three times and then arrested and held on $50,000 bail. Now that would send (some kind of) a message.

(no links this morning, for reasons known only to God and Blogger.com. - if either of them deigns to send me a fix, I'll have links in this post later)

Who knew a pool could kill?

Greenwich Time reports that the president of Shoreline Pools claims he never knew that a child could be sucked into a drain and injured, let alone killed. Well gee, sir, isn't that why they put drain covers on the things in the first place? It's a tragedy that the one you installed fell off, but its presence in the first place implies that you had some sense that danger lurked within.

But as bad or grossly negligent as Shoreline Pool's actions were, I do sympathise with the man's other argument: what was the Town of Greenwich's building department doing when it inspected this pool and granted it a certificate of occupancy? That the town gives its approval does not excuse Shoreline, but the parents of Zachary Cohn were let down twice, once by Shoreline and again by our town. They are now suing both the town and Shoreline and I shudder for my pocket book. If a fat dentist can turn a broken leg into $6,000,000 by merely waving the red flag of "Greenwich" in front of a Bridgeport jury, what will happen when another jury is presented with real culpability and the wrongful death of a beloved child?

The bag lady is singing

I have a friend at a liberal New York magazine who is convinced that global warming is about to bring our doom so the link above is for you, Nick! I continue to side with that master of doom, Glen Reynolds, who says, "I'll believe that we're facing a crisis when the people preaching that act like it". So when Al Gore gives up his private jets, when Edwards leaves his love child and mistress and returns to North Carolina (by train) to raze his 26,000 mansion and Barbara Streisand starts hanging her wash out to dry in Beverly Hills, I'll believe. Until then ...

Off to see open houses

Not much new on today. Leona Helmsley's place is open again to us agents but I've seen it once and, while it's very nice, I don't have any customers in her $125,000,000 price range so I think I'll pass this time. Those statistics I posted yesterday were so depressing that my manager told me that she was not going to pass them out at today's sales meeting for fear that everyone would run into the street and beg to be run over. Ah, it's just a cycle. Just like automobiles or airplanes, these things go round and round, up and down. The uncertainty - how down will we go, and for how long? - is what's whacking the market right now, but we've seen it before and we'll see it again.
In the meantime, if you're a buyer and have access to cash or a mortgage, you're king.
More after the tour.

Update
Well that was quick (quicker than writing this update, which disappeared down the rat hole when I tried to post it). One decent house in north western Greenwich on a beautiful acre and asking $1,499,000 which I think is pretty good. I'll have pictures and a write up of it soon. Other than that, we were treated to a Belle Haven house that sat unsold for a full year at $16,800,000. It now has a new broker and a new price, $14,250,000, but I don't think that will do the trick either. "Belle Haven premium" notwithstanding, I suspect that, at this price, the house will still be here a year from now. Another house, on three close-to-town acres, offers either a total renovation project or is a tear-down. Asking more than $9,000,000, it too will probably continue to linger. All in all, current sellers seem to be ignoring Dr. Johnson's warning about second marriages which he described as "the triumph of hope over experience."

Deck Materials

Popular Mechanics (click title above for the link) has a good article on the various options for decking material. I've made decks from three of the four mentioned (pressure treated, fir and composite) and my experience matches the reporter's. I no longer build decks - or I haven't in a long time - but Rick Crossman does, and his company, Archadeck, is here in Old Greenwich. Give him a call (978 - 9050) and he'll give you prices on all of this. If you can't sell your house and you're going to stick around for awhile, you might as well enjoy the view from a new deck.

Sales and Inventory

Well, as I suspected, we're a little slow here in town - time to head for the Rockies or the beach until say, next February. Contrary to what I opined in a comment below, the $1 million to $3 million dollar house is still our bread and butter but according to these stats, we're reduced to dining on stale crusts and oleo margarine. Here's what we're up against (and sorry for the layout - we're still futzing with this blog - what I see is not what you get, and it's frustrating):

Contracts since March 1, 2008
<$1,000,000 39 current inventory = 72
$1-$1.49 31 current inventory = 137
$1.5-1.99 29 current inventory = 98
$2.0-2.99 41 current inventory = 163
$3.0-$4.99 37 ` current inventory = 161
$5.0-$7.99 16 current inventory = 103
$8.0+ 7 current inventory = 81

Best Agents?

In a comment to my previous post concerning active, knowledgeable agents versus the 90% who eat bon bons by their pools and wait to view properties for the first time with a client (I refer to this as a "mutual voyage of discovery" and consider it a huge waste of the client's time) a reader asks how he can determine who among the 1,000 agents in town is one of the best. Since he already has my name, I'll restrict my remarks to other agents.

There are plenty of good agents in town but, short of posting yourself outside a broker open house all day and seeing who shows up and who doesn't, it's tough to figure out. If you call a brokerage firm's manager and ask for one of the top producing agents (we do represent both buyers and sellers), you might get the right person, but you might also get whoever is on floor duty that day. Depending on who is in the office at the time, this could be good or bad.

Reputation is usually a good sign - ask friends who have recently bought or sold a house who their agent was, and what they thought of her. For large firms with sales recognition programs, check the agent's websites for membership in the firm's top 5% or 1% circle (naturally, I've been in both, so I think this is a great technique!). But the top selling agent last year, town wide, was David Ogilvy, who doesn't employ such showmanship, nor does he need to - see above, under "reputation'. My brother Gideon works for Cleveland, Duble and Arnold and they, too don't have top producer awards yet his name will be found among the top sellers. Jean Ruggiero, my colleague here at William Raveis, is not only the second-most productive agent in Greenwich, she's got an excellent reputation for success and has also been a member of the Raveis "Chairman's Elite Club" forever, so there you have it.

My personal experience is that the agent is more important than the firm he or she works for. We all have websites, some of which are better than others, we all have "international connections", for what they're worth (generally, very little) and we are all capable of exposing your house to the Multiple Listing Service, which is what will probably sell your house, eventually. So comfort level and confidence should take priority. Until this year, I'd have insisted that you check how many transactions a candidate did in the past year, just to get a feel for their familiarity with the market place but today? A fellow agent came into the office last week, crowing that she'd just been out with a buyer. I suggested that she stick the guy in formaldehyde and preserve him as the last of his breed.

So ask around, make some calls, talk with a number of agents and either ask them about or check their resume. And, even in a slow market, you should probably keep your listing to six months, so that you can get out of an ill-fitting relationship. For you buyers - if you're out there - be especially careful about signing a "buyer's representation agreement" that locks you in for more than a day or two. especially if you've never met the agent before. State law requires that we get you to sign such an agreement the first time we meet face-to-face, but the agreement can be limited to just a few specific houses or one day. The worst thing you can do to yourself is sign up for six months exclusive representation with someone who, on your first tour you discover is incompatible. I use one-day agreements, but I am aware of agents who try to lock customers in for six months or even, in the most egregious example, a full year. Someone who's that insecure about getting along with you is probably no one you want to do business with.

Good news, bad news

The good news is that 1 Flagler Drive, asking $5,900,000, went to contract over the weekend, presumably for something less than asking price but proof nonetheless that there are still some deep-pocketed buyers out there. The bad news is that this gargantuan (by my standards - at 11,000 sq.ft. it's probably tiny for other folk's taste) mansion sat on the market since September 2, 2005, when it asked $8,495,000. Lesson here, I suppose, is that if you slash $2.5-$3.0 million from your asking price, you'll eventually sell anything in this price range. Another lesson is don't be so silly in the first place.

A New low in euphemism

Greenwich Time refers today to "anti-prohibitionists" who used to run booze up my creek and stash it at what is now Dot McCullough's boat house. Didn't we used to call these folks "rum runners"? More colorful and far more accurate: I'm pretty sure that the criminals were very much in favor of Prohibition, because it enabled them to make huge, albeit illicit fortunes - just ask Joe Kennedy.

By the way, I hate using Greenwich Time's website because of the pop-up ad for Greenwich Hospital that floats across the screen, blocking access to the main article. I don't know how much the paper is receiving for this ad, but I'd think the cost of reader annoyance exceeds the fee.

Don't Taser me, Bro!

Our School Board has sent out a survey to parents, asking if they "support a school resource officer at the high school". The Board eschewed the use of such inflammatory language as "armed and tasered" because they apparently feared that using the more accurate description might alarm parents and cause them to withhold their support for a program the Board itself obviously endorses. "School Resources Officer" sounds so benign - officer Friendly, there to help students find their lost textbooks, perhaps coax a stray kitten from a tree or maybe help out with a tough homework assignment. The reality is that at least one such officer tasered a kid last year for kicking a chair and tossing a water balloon - a dastardly deed, but, speaking as someone who lobbed 1/2 a grapefruit across the Student Center at a group of visiting educators way back in 1971, hardly a capital offense.

The trouble with giving cops toys like Tasers or, God help us, lots of really cool SWAT Team equipment is that, sooner or later, they're going to want to use it. I say, if we're that concerned about a Columbine at the High School, either arm the teachers or take the taser away from the cop. Someone might still get killed, I suppose, but the temptation to use non-lethal force beyond a head-lock would be removed.

Over-sized houses

I had to reset my computer's P Ram yesterday (don't ask) and it seems to have killed my ability to import photos. Drat - I was planning to start adding photos today, beginning with a picture of a new house under construction at 247 Riverside Avenue. Well, maybe later. In the meantime, if you're in the neighborhood, take a look at this place. It might not be a bad looking house in another location on a larger lot but it's replacing an 1800's farmhouse that had been set far back from the road and, no doubt because of lot-size restrictions, the builder has stuck a huge garage on the end facing the street. The total effect is just butt-ugly, is what it is, and it annoys me to think that it doubtless complies with all applicable FAR regulations. It's precisely here, where the street scape is threatened, that FAR rules should operate to save us but they don't. FAR is a complex, ineffective and costly mess, and yet, the more this is pointed out and solutions proposed, the tighter Franklin Bloomer and his friends on the land use commission grip their creation. Pride of authorship is a good thing; so, too, is the ability to admit when you're wrong.

Update
Figured out the photo thing (for today, anyway)

The polar bears are drowning! (next year)

Alaska is experiencing its coldest summer ever (in recent history, I presume). Climate experts have rushed to explain that this says nothing about global warming and boy, watch out for next year, but as one commentator notes in the linked article, how come every cooling phenomenon is attributed to natural causes and every warming spell is blamed on humans? It's embarrassing data like this that caused the almost-subtle switch last year from "global warming" to "climate change". Once the terminology was changed, everything that happens on earth can be blamed on people who live in 26,000 sq.ft. homes and fly private jets to Bali - oh wait, that's not right.

Amazing News

The New York Times hasn't done much reporting on the surge in Iraq's success but suddenly it's catching up with what less mainstream sources - .bloggers in Iraq, primarily - have been noticing for months: things are getting better. Oil production is up from 1 million barrels a month to 18 , and the Shiite militias are weakened, for instance. Why this sudden outpouring of good news? It could be that the Times has finally noticed what's been going on, I suppose, but I suspect that the paper, like all Obama supporters, wants to get Iraq behind him. His (continued) opposition to the surge, so clearly wrong in retrospect, makes him look like the inexperienced naif that he is, notwithstanding his photo-ops with various world leaders last week. But if Iraq's "so yesterday", then let's move on to things that really matter, like raising taxes on the "rich" and ruining our health care, the only things Obama fans really care about anyway.

Opne Houses

A reader asked how often an agent should hold open houses for a property. He specifically asked about broker open houses, but both broker (agent, technically) and public open houses are worth some comment. Broker open houses are essential - there's no substitute for actually going inside a house, gauging the quality of its construction, the exact noise level of the street outside, the "flow" of the house and so forth; you get none of that from merely reading the Internet listing.

But, of the 1000 real estate agents in town, probably only 100 can be bothered to go out and examine the inventory on Tuesdays (North Street and west) and Thursdays (east of North Street). What are the other 900 doing? God knows, but I certainly wouldn't want to use their services if all they can contribute to my knowledge is what's already on Realtor.com. A good broker open house is one that draws 30-40 agents. You'll never get full attendance of the 100 because, not surprisingly, those 100 are our most successful agents and they are often busy conducting their own open houses. So I'd suggest holding 2 open houses in the first 2-4 weeks, just to give everyone who's going to come a chance to see the property. After that, every 6 weeks is probably not a bad idea - we don't like returning to a property but if something's happened; a price drop, or a new buyer for that price range, we can be lured back for a refresher.

Public open houses are, if not a scam, not really going to do much to sell your house. You'll draw nosy neighbors, a fair bunch of lookers and, very rarely, an actual customer. I think only 1% of viewers at a public open house end up buying that particular house, so your odds aren't good. On the other hand, agents like the events because our success rate in selling visitors a house other than yours is much better than 1%. There are buyers, after all, mixed in with the mere lookers - they just may not like your house. I've been known to bring my notebook computer to an open house and, if a couple clearly isn't interested in the house I'm showing, I'll pull up other choices in their price range. And because I've usually seen all those houses and am familiar with them, it gives me a chance to show off my knowledge. Good for me, tough luck for you - sorry.

So you can have a public open house every weekend, if you wish (your agent, who often is busy on weekends showing other customers around town, may be reluctant, but we can usually find a new agent willing to cover, in the hope that she'll find a new customer). Given the low odds of success in this endeavor, I think once a month is a more realistic schedule but, especially in a dead market, when the only hope of unloading a property is to keep slashing its price and the seller won't do that, we all tend to adopt the professional politicians' mantra, "when in danger, when in doubt, run in circles, scream and shout". A public open house is the moral equivalent of that.

An ebbing tide lowers all boats

New York City's financial firms expect to slash their bonuses by at least $10 billion this year and some experts are predicting cuts 2 or even 3X larger. While politicians love attacking Wall Streeters' excesses, New York City's and New York state's revenue will drop 10% and 20% respectively, based solely on the lowest estimate. If the cuts turn out to be as large as the more pessimistic forecasters say, you can do the appropriate math.

A lot of those people who won't be receiving year-end party checks this year live in Connecticut so our own state's revenue can be expected to be impacted (guess which county's residents Hartford will look to to make up the loss?) and, of course, it was these huge bonuses that kept the Greenwich real estate market so strong. As Joni Mitchell sang,"you don't know what you've got 'til it's gone".

The Mighty keep dropping

14 Baldwin Farms South, 13,500 sq.ft. of new construction, was put up for sale in May, 2007, asking $9,795.000 (that's $725 per sf, if you like that measurement). Not a bad house, but there were no takers, so its price has been gradually dropping. Today the seller whacked it again, down to $7,445,000 ($551 sq.ft). Don't know whether that will do the trick for this house, but, while we're not yet approaching the "affordable housing" threshold, we're getting there.

Update
Zillow.com, by the way, estimates this house's value at $7,652,000 (I love their precision) which, until today's price drop, was more accurate than the owner's opinion. On the other hand, and while I was on their site, I looked up a house with which I am quite familiar. They have it pegged at $1,495,000 which, if it weren't on a tidal creek, would probably be about right. But it is on the creek and that waterfront aspect adds, I hope, an additional $500K or so to its value. I don't fault Zillow - how the hell would they know? - but it does demonstrate that local knowledge is always a nice thing to have.

It's not about real estate, but (I think) it's funny
From an Englishman who wasn't impressed by Obama's European tour.

Update
Okay, it's been a slow morning for real estate, so here's a bit more Obama bashing (fans of the Messiah should avert their eyes). First, despite what he claimed in Berlin, there's no drought in Kansas, Dorothy. But never mind a lack of dust bowls,there's plenty else to fib about,as detailed here. I've grown used to Al Gore being given a free pass to spew nonsense, but he's not running for President. Couldn't the press ask a bit more from this ward-heeler from Chicago?

Is Zillow watching?
Within an hour of posting a comment about Zillow.com a nice-sounding fellow named David Gibbons replied on behalf, he says, of Zillow itself. What gives? Does Zillow have some sort of internet crawler that searches for references to itself and flashes the news back to headquarters? Is Mr. Gibbons actually a local resident who just happens to know more about Zillow than me? The latter is easily accomplished. I see that the gentleman has posted a second comment, requesting feedback on how sellers react when Zillow's price estimate is lower than their own. In my experience, it's the other way around - the few times a potential client has tossed a Zillow quote in my face, I usually have to argue for a price even lower. But Mr. Gibbons, I'll be happy to aaddrss the question in detail if you'll tell me how you found this tiny blog! Inquiring minds want to know.

Untold tales
I just went on Zillow.com's website to see what they're up to and noticed a house for sale (by owner) located at 12 Lockwood Road in Riverside and asking, according to Zillow, $6,000,000. Zillow estimates its worth at $2,566,000 and I think even that figure's high. The current owners paid $2,305,000 for it in March of last year and apparently have done nothing to it, so what gives? Is this seller insanity or an error by Zillow? If it's Zillow's fault, the owner ought to check his bait more often. If the seller himself set the price, it only serves as a demonstration of why some objective advice can sometimes be a good thing.

Update
As a commentator notes below, this is a Zillow feature called "make me move", which is, as he or she says, a "pie in the sky" price placed on it by the owner w/o any intention of actually placing it on the market. Good thing, too, because,as I saw in another Zillow listing, it looks like these owners aren't going anywhere soon. I do wonder, though, at Zillow's own calculation of value. The owner of 16 Willow Road's "make me move" price is $3,995,000, which ain't gonna happen; Zillow's own estimate is $3,600,000 and that's not reality either, in my opinion. 2 Willow, a more modern house, sold for $3,100,000, in a better market. If you're selling moving services, don't bother with these guys.

Our man in Washington
There's an interesting discussion going on in the comments section of the previous post concerning Wall Street, Washington and in general, pigs at the trough. In the meantime, the question of Senator Chris Dodd coming up, I thought to confirm my suspicion that his "presidential nomination campaign" served as nothing more than a sop to his ego and a sponge for the campaign contributions he could solicit (or extort) because of his position as Chairman of the Senate Banking Committee. As for ego, there's no doubt that every boy and girl serving in the Senate believes, deep down, that he's qualified to be President. But it takes an ego of truly gargantuan dimensions to act on that belief when polls list you at 1% voter recognition. That didn't stop Dodd, of course, particularly when he could indulge his aspirations at the expense of the financial community he regulates. Sure enough, the senator put the touch on his new best friends. Try this or, for a general overview from years past (I believe this latter doesn't include his presidential campaign contributions, which are tabulated separately) this.

Dodd learned from his father, of course, that direct solicitation of bribes leads to trouble, but squeezing folks you can choose to put out of business, well that's just Washington politics. Years ago, William F. Buckley pointed out that our Senator from New London regularly voted against every single defense appropriation except those supporting new nuclear submarines. It's certainly possible, as Buckley posited, that the senator truly believed that the only weapon that could protect our nation from its enemies was the nuclear sub. On the other hand, cynics might be forgiven for suspecting that the man was just a hollow, greedy shill who looked out for his interests and his interests only. I was one of those cynics oh so long ago and I've never changed my opinion.

Wall Street hearts Fannie Mae
Good article here in Bloomberg News concerning the pending bailout of Fannie Mae. It starts out with the rather typical cautionary tale of a borrower seduced by a sub-prime lender and her eventual rescue by her friendly government bank, but then proceeds to discuss, or at least touch upon, the various scandals, fraudulent accounting and other difficulties that have plagued this entity. Why does Jamie Diamon, head of JP Morgan Chase, love Fannie Mae? Why did Warren Buffet dump all his holdings of its stock three years ago? You really should explore some of the Wall Street Journal editorials that condemned Fannie Mae over the past decade for a full understanding but essentially, Jamie Diamon and his ilk could make a lot of money peddling crap and unloading it on Fannie Mae and Mr. Buffet has different standards. Of course, when you add in the cash contributions Fannie Mae made to Chris Dodd and his cronies over the years, it's hardly surprising that this fraud was permitted to operate for so long. And will continue to do so, apparently - just ask The Journal.

Mea Culpa
There's a nice post in the comments section from Pam, who gently reminds me that I used to defend the strength of the Greenwich market. It's true, I did: I did point out what I thought were over-priced houses, and cautioned that, obviously, prices couldn't keep increasing 20% per year, every year, but I was fond of saying that, so long as NYC continued to attract the best, brightest and most ambitious young people from around the world, they'd continue to meet, fall in love, have babies and look toward the suburbs to raise those babies. Because Greenwich is one of the best of those suburbs, I was pretty confident that we'd continue to get our share of new blood, and buyers. But "No one expects the Spanish Inquisition" and I didn't expect the collapse of the credit market and the subsequent downturn on Wall Street. Greenwich never had many sub-prime mortgages or large spec developments to begin with so when the sub-prime lenders and real estate speculators started to topple I thought the disaster would be limited to places like California and Florida. Wrong.

But, long term, I still like our position. There will always be money to be made lending to millionaires, and we're still not adding any new land, so I expect to see a recovery not too long in the future (unless Wall Street and its bankers disappear and the financial world shifts to Dubai, a not entirely impossible scenario). If you own a house that you want to sell, hang on and hope. If you're thinking of buying, I'd look silly suggesting that prices won't continue falling, but as interest and construction costs keep rising, you might want to grab a good deal now - if you don't have to resell in the next few years, I think you'll do just fine.

Pricing
There were 26 price reductions reported yesterday, compared with 2 contracts. Not an encouraging ratio. One reduction that caught my eye was for 4 Old Round Hill, a big, almost new mansion just off of Round Hill itself. This place was originally priced in May '06 at $14,500,000 and slowly dropped to $12.5M a year later. Still unsold, the seller increased its price to $13.995M the next day; not a tactic I'd ordinarily recommend. It's been dropping ever since and yesterday took another hit, coming down another million to $10.9. So two years after first being offered for sale, it's still unsold and is now $3.5M less. The first price was obviously (in retrospect) too aggressive, even for the 2006 market. In today's market, the new price may still be too high. Somewhere in the past two years, I suspect, a realistic price would have moved this house but now, who knows? It's a very nice house with a great location and yard, but is anyone buying?

HoJo's
Thanks to two intrepid readers, Pam, who remembered what letter the place would start with, and Jess, who actually tracked down the article, we learn the following:

"From the Greenwich Post:

Jun 5, 2008
Going up in Blue Smoke
Howard Johnson to house new restaurant; plans for hotel
By Sonia Fernandez, Staff Reporter

The Howard Johnson will be renovated as the Delmar opens a new hotel at that location and Blue Smoke takes the place of Tandoori restaurant
Blue Smoke will be sweeping through Greenwich as Union Square Hospitality Group prepares to open its first restaurant outside New York City.

Named after its predecessor on 27th Street and Park Avenue, Blue Smoke Chophouse will move into the space that was occupied by the Howard Johnson in Riverside, along with a new hotel operated by the same group that operates the Delamar Greenwich Harbor hotel....

The Union Square Hospitality Group has enhanced the ambiance of the restaurant by focusing on wood-fired cooking. Not only will the meats be wood-smoked, but the grills and ovens will also be wood-fired....

Plans to renovate the Howard Johnson and the attached Tandoori restaurant were submitted to the Planning and Zoning Commission on March 19, but have been dropped as both the hotel and restaurant are being gutted to make room for the new plans.

While the new hotel has yet to start the planning and zoning process, Mr. Swinghamer said he hopes the restaurant will be ready by next summer . . . .

[end of article]

I love both Cajun and barbeque, so I'll probably give this a try - if the estimated completion date is accurate, I'll have a year to save up for the experience.

Funny thing - when I Googled HoJo's Riverside to see if there were any stories about its future I found lots of information on the old place with no hint that you won't be staying there again - surprise! and a map locating the motel just over the Stamford border. I suppose that, since it's closed anyway, a little misdirection won't harm anyone but how many other Google maps are this far off? Makes me want to rethink tossing out my old paper maps.

Price reductions

The condos on South Water Street have just had their prices cut by several hundred thousand dollars each. Not too surprising, but it's too bad for the developers. I think they stood a better chance of success before the town zoning folks made them slash the number of units and amenities. You'd think we didn't want Byram developed, or something.

Fun with numbers
The Greenwich MLS has just issued its latest quarterly sales book and it's been interesting to seen how my organization continues to screw up sales data, for unkown motives. 723 Lake Avenue, for instance, was actually first listed at $7,250,000 in February,2005 and finally sold for $5,775,000 in June, 2008. The sales book shows an original price of $6,995,000 (one of the intermediate prices as it climbed down, actually) and only 210 days on the market. I'm not too good at math, but February '05 to June '08 would seem to be more than 210 days.

The sales book gets 26 Mayfair Lane's days on market right (I think - I didn't actually count: 547, but shows the "original price" as $6,750,000, thus making the selling price of $6,250,000 look reasonable. "Nothing to see here - move along, move along." In fact, the original price was $8,350,000 and $6,250,000 represents a heck of a bite from that dreamed-for sum.

So who's gaming the system here? Maybe no one - whenever I inquire at the Board, they blame everything on some third-party computer program that they can't control, but our data are being corrupted and that, in turn, makes it impossible to trust what's being spewed out as truth. In the long run, this can only hurt the entire Greenwich real estate market.

Needless Tragedy
Greenwich Time reports that the head of Shoreline pools has been arrested on second degree manslaughter charges in connection with the drowning death of a four-year-old boy last summer. According to the prosecutor, our state building code mandates three separate safety devices/systems - the newly installed pool had only one of them. Admittedly, the code had recently changed and the pool company may have been unaware of its new obligations, but what troubles me is that our town's building inspector issued Shoreline a certificate of occupancy, an official imprimatur signifying full compliance with all applicable regulations. Our building department has no difficulty sniffing out non-lethal violations of FAR requirements, and is delighted to order builders to chop up attics into non-usable space, lower or remove retaining walls deemed too high, etc. What's so difficult about inspecting something as dangerous as a pool and ensuring that it complies with code?

Statistics
We have 626 single family homes currently for sale in Greenwich, an 18% increase over this time last year. From May 1,2008 through today, July 21, 37 houses sold, compared to 68 last year (comparable numbers for YTD are 174 vs 208.
Contracts aren't any better: 115 this year (May -July 21) vs 148 last year and 160 in 2006. That's a 28% drop over two years, if my calculator and atrophied math skills haven't failed me.

The market is going down
I've complained before about the difficulty of comparing selling prices for the same property because so many houses are renovated between purchase and resale. Here's one that wasn't: 26 Lake Drive South, in Riverside. The current owners paid $2.125M for it in January 2005, did nothing to it (the previous owners had done the necessary renovations like new kitchen and baths)and put it on the market this year for $2.250. That was a reasonable response to the softening market - after commissions and taxes, they'd have been luck to break even - but it sold yesterday for just $1.850. So apples to apples, three and a half years later, it was worth $275,000 less.

And here's another sad tale, perhaps, depending on how you feel about wildly-unrealistic original asking prices: 402 Sound Beach Avenue was listed February, 2006 for $3.399 M and went to contract yesterday for something less than its latest price of $2.395M. In answer to my reader who keeps urging me to show over-priced listings, this is a nice example of why I won't bother; it took 2 1/2 years for the seller to come to his senses. Of course, by pricing it so high to begin with, the seller missed what was left of the bull market and sold on the downside, all to his loss - I doubt this house was $1,000,000 too high in 2006, but it sure was by the time he sold it.

On a cheerier note, Joann Erb's listing, direct waterfront at 200 Shore Road (close to the beach), was listed June 26 this year for $8,000,000 and has already gone to contract, demonstrating again that a beautiful newish (5 years?) house with spectacular waterfront will trump price, a busy road and a narrow lot, every time.

Well, almost every time. 23 Eggleston Lane isn't a new house but does have waterfront on the Cove and a dock. It originally asked $8.5M and dropped again yesterday to a new price of $6.975. You'd think that a $1.5M chop would speed things along but we'll have to wait and see.

26 Mayfair Lane originally asked $8.375M. 547 days later, it sold for $6.250M. I won't presume to read the minds of sellers, but these seemed quite elderly and I wonder if they really wanted to get a high price or just got some bad advice. Either way, it's tough to keep your house in showroom condition for almost two years so, unless you like that sort of stuff, I'd price it realistically and move on.

The glaciers are melting! The glaciers are melting!

Bruce Museum has mounted an exhibit depicting the melting of glaciers all to scare little kids and prove the wickedness of our ways. Fine and dandy, but I do wish they'd thought to include in the exhibit a reference to wooden structures dating from the 12th Century emerging from the melting glaciers in Switzerland, or even some indication that not all scientists agree that the current warming spell is unprecedented in human history . Because, if the earth has undergone this sort of thing in recent history but before the small scattering of humans had the numbers to significantly affect the climate, then perhaps we should pause a bit and reconsider shutting down 80% of the western world's economy. Just a thought.

Seller's season?
A reader asks about the upcoming fall season but I confess that I don't know what's going to happen. Historically, the spring season began in late January, continued through March and early April, then cooled off when all the buyers who wanted to get in their house by the end of June had found a house. Summers tended to be slow, but there were buyers who wanted to be in their new house before school started so they remained active and we usually saw a fair amount of activity. I always liked looking for houses with buyers in July and August because so much of our competition - other agents and buyers - tended to be away and the search could proceed at a more leisurely pace. The Fall market began after Labor Day, roared through the next ten weeks and then shut down for the Thanksgiving-New Year holiday season.

This year looks pretty dismal, to be honest. There is a scattering of buyers around - one of my listings is being shown today, in fact - but certainly their numbers are way down and there's absolutely no sense of urgency. And why should there be? Mortgages are hard to find, house prices are dropping, we're threatened with a possible string of bank runs, Wall Streeters are jumping out windows, Iran threatens war (unless, as it insists, the threat to wipe Israel off the map "was just a joke" - ha ha ha), the Demmerkrats loom on the horizon, etc. etc. If I were a buyer but didn't need a house right away, I think I'd wait. Of course, sellers are getting nervous, too, so what might have been an unacceptable offer six months ago may very well be received with gratitude today. If the market does rebound by spring (big if), that opportunity may be gone.

All of which is to say that I may go on vacation in August and, if I find myself in a nice place, I just might stay there through the fall.

Oops!
54 Rock Maple Road (off Stanwich) was originally listed for $12,450 last year (thanks for the correction by one of the commentators below. I thought it crazily over-priced at the time and said so (without identifying it) in my column. Apparently the market agreed with my assessment so it hasn't sold and today it was marked down, again, to $6,950,000. The sad thing (for the seller, at least) is that a lot of folks in the $7,000,000 market last fall never saw this place when it was pegged at almost $12M (notwithstanding the pleas of one of my commentators, agents just won't waste their time showing grossly over-priced houses. The seller is obviously not serious, so why bother?. They either bought something else, like my own clients, or moved on. Either way, there are fewer buyers in that price range now than there were a year ago, so an opportunity was missed. Where's the bottom for this house and the market in general? I don't know.

A Practical Seller
Nokia, the cellphone people (they also used to make fine snowtires, but I believe they've left that business) bought 30 Owenoke Way in Riverside for one of their executives two years ago(6/29/06) for $2,950,000, down from its original asking price of $3,450,000. The executive having presumably moved back to Finland, the property is back on the market, asking $2,995,000. The company may or may not get that desired appreciation of $45,000, but at least it hasn't mistaken a flat or falling market with a soaring one.

5 Lockwood Drive, in Old Greenwich, seems to be taking a more positive view than mine. This house failed to sell at $2,950,000 in 2005 and was withdrawn. Now it's back, still asking $2.95M. I'm not at all sure that the market is better today than it was in 2005. The seller obviously would disagree.

Falling in Love
It almost never happens, at least in real estate. It's true that, in 1954, my parents saw a house in Riverside with a beautiful library, with fireplace, looking west over a huge backyard and my mother did immediately fall in love: she envisioned having her afternoon tea in that room, with a crackling fire behind her and her wonderful children frolicking in the back yard. My parents bought the house, but the tea thing never happened - five kids did, and our squabbling, noisy behavior put paid to that dream. A typical outcome for most real estate fantasies.

But other fantasies persist: the stranger who will fall in love with a house while simultaneously agreeing to pay more for it than a comparable house, the "foreigner" who, lured to Greenwich by some "international" firm's website is shown your house, converts Euros to dollars in his head and makes you a full price offer, or Elvis returning from Mars in order to reestablish Graceland on your site. Don't hold your breath for any of these to occur.

What you as a seller might want to do is have your agent arrange for you to see two or three houses that she feels are competing for your buyer, then go see them while maintaining an open, objective mind. Leave your memories and life's adventures behind when you go. The swing set that your now 22-year old daughter played on when she was three holds no value, sentimental or otherwise, for a buyer. Same for that secret flower garden where your wife hosted Brownie troop meetings. All warm memories for you, and worth nothing to anyone else. Memories aren't a factor in pricing. On your tour, check out the kitchen - are you offering Formica counters and 40 - year-old cabinets? Was your bathroom last updated during the Coolidge administration? These may indeed have been "good enough for my family", but you're trying to sell the place to a new family, not keep yours in place. Adjust your price to your competition.

And if you have renovated your house, know that all the cherry flooring, Sub-Zero appliance and coffer-ceiling libraries you've installed probably don't set your place apart from others in your price range - they all have such things, or lack them, depending on that price range. If you've got all those amenities and your competitors don't then congratulations: you've priced your house right and you should expect an early sale. If it's the other way around, you're doomed.

Alternative Energy Hogwash
AlGore has demanded that we stop all production of oil and switch to "alternative energy" (undefined) by 20015. How are we to achieve that? He doesn't say. Nor would the very nice young college student who visited my house the other evening, soliciting signatures on a petition that "was in favor of alternative energy". "How are we going to get energy produced in Arizona to homes in Connecticut?" I asked. She was a little imprecise in her answer but I didn't press her - she was about the age of my own daughters and there was no way I wanted to be mean to her. But for all you fans of science fiction stuff, here's Steven Den Beste's take on the subject. He makes my point with far more clarity and succinctness than I can.

The other education shoe drops
Despite its cheery headline today,Greenwich Time does finally get around to reporting the bad news: test scores for writing and math are down for elementary and middle school students. The end of the world is not upon us - almost 80% of the students are at at least grade level in these skills, but the future for the failing 20% looks bleak. There were some thoughtful comments submitted in response to my previous post on this subject, and I do sympathize with teachers who face the unenviable task of drumming knowledge into thick skulls distracted by imessages, the latest U Tube and last night's results from American Idol, but what he heck are we doing here? Some years ago, while trying to make a living as a writer (didn't work, but it was fun), I hired on as a Kaplan tutor for LSATs - Law School Admission tests. My students were all college graduates and eager to master the test, something you don't often encounter when teaching high school students, and I had reasonable success guiding them through the logic and reading comprehension questions that comprise most of the exam. But I was struck by their complete lack of historical and literary knowledge. I'd refer to an event, or a line from Shakespear or even a post WW II classic and be met with blank stares. Edmund Burke said that without continuity, men 'would become little better than the flies of summer"; we're fast approaching that level.

My own beloved daughter, a graduate of the high school, has an appalling lack of 20th Century history and I wouldn't dare to test her knowledge of eras predating that. I once, after seeing her reading some insipid bit of fluff for her English class, wrote to her teacher, who happened to have taught me English in 1969-70, my Junior year. I pointed out that we'd read "Look Homeward Angel" that year, which opened up the entire world of Thomas Wolfe and his works - I think I read them all. "So what's happened?" I asked. He replied that, today, if he assigned anything even approaching the difficulty and length of Wolfe, his students would simply refuse to read it.

I don't pretend to know how to instill a love of learning and the aptitude to apply a keen mind to difficult tasks, but if we can't do it in Greenwich,with all its advantages, I suspect that the Indians and Chinese will figure it out. And then won't we be in trouble.

Update
I agree with the comment posted below about seizing control of our schools back from the union and our superintendent. For an example of how this was done in Los Angeles, check out this article

Tips for sellers
I don't have many, alas. The Wall Street Journal ran an article recently on just this subject (not worth linking to, as it's subscription only) and it had eight or nine tips that we Realtors have been preaching for years. Clear out the clutter, paint to refresh, fix as many defects as practical, don't spend a whole lot on major renovations and, above all, don't over-price your house. The author said that, depending on where you live, expect to sell your house for as little as 50% of what it was worth in 2003. The situation is not that bad in Greenwich, but I recently had, then lost (thank God) a listing that was hugely over-priced by its owner. He took what he'd paid for it three years before, calculated a 7% annual appreciation, added up the money he'd spent on renovations, threw in commissions and taxes and announced his price. Despite my warning that the market no longer supports that kind of financial "thinking" he insisted, then became furious when we had no - literally no - showings in 3 months. He insisted on being released half way through his six month listing contract and I was glad to let him go. The new agent, four months on, has yet to sell it, despite a modest price reduction.

One reader urges me to "think outside the box" and come up with ideas for sellers, aside from pricing a house properly. Unfortunately, there is nothing I know of that will overcome a bad price. I've seen cruises, increased commissions and huge bonuses offered to any agent who brings in a buyer, but aside from ethical concerns (how can I claim to represent a buyer and then recommend an over-priced house because I can earn a Caribbean junket?) I don't think they work. Neither do classical piano players at broker or public open houses, clowns handing out lottery tickets or painting a house day glow orange.

I do believe in decluttering a house, and I mean a severe cleansing of all or almost all of the objects that make your house personal to you: family portraits, kids art on the refrigerator, that nude of your wife hanging in the bedroom (I've seen two of those) etc. Once you decide to sell your house, remove your personality from it to make room for a potential buyer to envision herself living in it. That's hard to do when she's tripping over 4,000 stuffed toys in the playroom. If you don't believe me, take a tip from David Ogilvy. I have an occasional difference of opinion with David on his initial pricing decisions, but you will never see an Ogilvy listing that isn't neat, pristine and in move-in condition. It's a technique that's worked well for David over the decades and it will work for you, too.

But price it right. If you think you've done so, and no one's making offers, you were wrong and you should lower the price, immediately.

460 North Street
This mansion, across from St. Michael Church, is an outstanding old mansion whose original grounds have been sliced down to just under 4 acres. It last came on the market in April '03 asking $12,500. I was pretty new to this business then so when the cop directing traffic asked me as I was leaving,"what's it going to sell for?" I had no hesitation replying, "at least three million less than they're asking". I was wrong: 18 months later it finally sold for $4,000,000 less but, to be fair to myself, that extra million dollar wallop might have been caused by sitting on the market so long.
In any event, it's back on the market now, after what its agent claims was "a total renovation", for $11,950,000. That may still be too high - I haven't seen the scope of the renovations, but it's interesting to see the drop in expectations from 2003 to now.

Taking a different approach, the owner of 101 Dingletown Road put his house up for sale in June of this year at $5,785,000. Finding no takers he raised his price three weeks later to $5,995,000 and, when that still didn't work, raised it again yesterday to $6,395,000. I have never seen this loony strategy work, so look for this house next year at $12,500,000. It will still be for sale.

Update
I had a chance to tour 460 North Street this morning and I was impressed. The "total renovation", a term used with alarming flexibility by some Realtors, was indeed thorough; the custom, leaded glass thermopane windows, for instance, cost over $1M according to the broker, and I believe him. New roof, new kitchen, new baths, new HVAC, etc., all combine to make this house worth at close to its asking price and certainly closer than it was under its previous owners in 2003. I like its proximity to town and because it's set way back from the street, road noise seemed neglible. Neither I nor any of my customers have this kind of money, darn it, but I can only hope someone still does and is willing to spend it in this market. In past years, this house would go in a heartbeat. It may take longer now.

School test scores drop.

Greenwich 10 th graders seem to be doing as poorly on math, science and reading scores as their counterparts in other parts of the state, which baffles me. We're a town comprised of, in the main, well educated parents with an abiding interest in the academic success of their children. I can understand why a kid in Hartford, with a single, drug addicted mother and a slum as living quarters might not be able to read at grade level, but Greenwich? We spend more per pupil than any other school district (with the possible exception of Hartford) for poor results. Why? And what's going wrong in our schools? Even if you, like me, have no children in school, this issue affects your pocketbook - real estate values are hugely dependent on the quality of public education. I doubt we need to spend still more money on the issue, but we ought to find out why the dollars we are spending achieve so little.

Update
A comment below takes me to task for writing about slum kids in Hartford. I, too have at least a little experience trying to teach such kids; in 1969, as a high school student, I tutored a young man in Trenton at his house which I think fairly could be described as a slum. Our tutoring sessions were constantly interrupted by his noisy siblings - they had no other room to play in - while his very young mother, clearly on some kind of drug, snoozed in the corner. Far from denegrating kids like that, I was attempting to cut them some slack. Maybe that's the "soft bigotry of low expectations" but I contrast that student, eager to learn despite his living conditions, with spoiled Greenwich kids and conclude that our kids, at least, have no excuse for not learning.

Trees
Once again, according to Greenwich Time, our town officials, including a so-called Republican, Peter Crumbine, are nosing around a proposal to regulate the cutting of trees on private property.

"Republican Selectman Peter Crumbine asked Tree Warden Bruce Spaman if he could consider adopting a similar ordinance curbing the removal of trees on private property.
"There is a lot of interest in the community and concern about a great deal of clear cutting in town," Crumbine said. "Are you considering what you can or can't do about that?"
Spaman said while the town doesn't currently regulate the removal of trees on private property, some towns have adopted restrictions limiting removal of trees on private land successfully.
"I expect that to be the other shoe to drop," Spaman said.

Look - I like trees, and even have a few of them on my own property, providing shade, a home for squirrels and all sorts of ecologically-friendly benefits. But the typical Greenwich homestead is cluttered with the things, and, here's a shock, they're all second (or third or fourth) growth. No one ever built a stonewall in a forest, so when you trip over one when hiking, be assured that you're traipsing through a former pasture. Similarly, Fort Stamford,on Den Road, was sited where it was so that Revolution-era soldiers could keep an eye on British traffic on Long Island Sound. It was a clear sweep of farmland from the top of the hill to the water, a distance of, what, 8 miles? Try spotting even a glimpse of water from that vantage point today and you'll fail.

Mature, well-sited trees add value to a house, but a clutter of scraggly celulose that preempts a yard does nothing but detract from that value. Who is to decide between preservation and removal? Mr. Crumbine and his supporters want to hand off that right to yet another commission. I think that Greenwich homeowners should fight to reserve the decision to themselves.

Recent sales

Bidding war!
314 Sound Beach Avenue, a modest little cape, came on this spring asking $1.39M and went to contract almost immediately via a bidding war. It closed yesterday, so we in the real estate world could finally learn the winning bid: $1,510M. The successful bidder was represented by an agent who often works with builders so this house may be destined for razing, I don't know. It's a brave builder, if so, but it's nice to see multiple buyers out there seeking the same property. Gladdens the heart of every would-be seller.

34 Cedar Wood Drive didn't go to multiple bids, but this new, big (9000+ sq.ft) house asked $7.895M and quickly accepted an offer of $7.375. Smart builder, in my opinion.

Two that haven't sold include a two bedroom in Cos Cob that sat on the market unwanted for just under $2M. I thought it should be asking far less than that, somewhere in the $1.495 neighborhood and I expected it to sell for even less, perhaps $1.395. Instead of lowering the price, the seller renovated the master bath kitchen and a lower level bath and has returned it to the market for $200,000 more than its original asking price. If, as I suspect, it's the location that's been hampering the sale, then the renovations won't help - the location remains what it is. But we'll see, and if the house sells, I'll have learned a lesson, one which I'll pass along.

17 Marks Road, in Riverside, provides a nice illustration of our declining market, at least for old (1898), smallish (3 bedroom) homes. It sold in May '04 for $2.250M and with no major improvements, was put up for sale again September 1, '05 for $2.835. That didn't really work out but it did sell in July '06 for $2.495. Now it's back again and yesterday its price was dropped to $2.45. After deducting commissions, conveyance taxes and attorneys' fees, someone's going to be hurting.

Will this global warming stop at nothing? Sheer idiocy, and it increases daily.

The Marvelous Chuck Schumer

The Wall Street Journal a has a great editorial on how this dreadful man single-handedly brought down a bank. I assume most of my readers also read the WSJ but just in case you missed it ....

One Off, One Still On

18 Sherwood Farm Lane, a very nice house built in 2001 on the Rockefeller land in Glenville, has gone to contract just two weeks or so after being listed. What impresses me is that (a) it wasn't brand new construction and (b) any sign of market activity in this price range $5,400,000 is always welcome.

53 Park Avenue South, on the other hand, has been reduced again and is now asking $2,295,000, a steep drop from its January listing price of $2,777,000. I liked this house and said so when it was first listed, but its failure to sell serves as a cautionary lesson: don't over-customize a house to your idiosyncratic tastes (this one was built as a modern Victorian, with garish or authentic, you take your pick-colors), don't build a three-bedroom house in Old Greenwich, where buyers expect a minimum of four, and add a family room. This house is ideal for a couple; most buyers in Old Greenwich have a passel of kids.

Grammar Police
A reader has taken it upon himself to monitor my spelling and grammar in this blog, which I appreciate. I no longer have a copy editor and, while I sometimes had amusing arguments with them (for instance, convincing an earnest young lady from Kansas that, yes, I knew that "au pair" wasn't really an anagram for "over-priced french baby sitter")as I claimed in The New Millionaire's Handbook , I did enjoy having them save me from my worst mistakes. So if somebody (or is it someone-I'll await a decision from my reader) wants to take on that task, for free, it's just fine with me.

Waiting for the other shoe to drop
Nothing coming out of the banking industry is good news recently, so buyers are understandably nervous and reluctant to buy. I can't give you advice on whether your job at UBS is threatened (well, according to some people I know, I can - don't plan any expensive vacations soon) but I did learn an interesting tidbit from Mark Hawkins, my colleague at William Raveis's mortgage banking division. According to Mark, a house's price must drop 10% to make up the difference of a 1% increase on a 30 year fixed rate. Interest rates are definitely going up, so waiting to commit on a house may end up costing, rather than saving you money.

On the other hand, do you have enough cash to buy a new house? The days of 20% (or, better yet, 10%) down are gone, at least for mortgages exceeding $2,000,000, which, in Greenwich, is a lot of the market. $2M mortgages require 30% down and it only gets worse from there. Greenwich real estate has performed no worse than the Dow (down about 14%) but certainly no better. Which will fare worse in the next year? Your guess is as good (probably better) than mine, but my guess says, as Wall Street goes, so goes the Greenwich market. Ya pays your money, ya take your chances. If you need a house now, though, and you've got some stocks you want to dump or a large pile of cash doing nothing, you can probably take advantage of a seller who is as nervous as you.

Richmond Hill Drive
This street, way off in Greenwich's northwestern corner by John Street, saw a spurt of building projects a few years ago. I can't tell what happened to a couple of the most expensive of them - they were deleted from our listings. Did they eventually sell privately? Only their agent knows.

56 Richmond sold in February,2008 for $4.2 million, but it was originally listed at $5.695 million in January 2007. Ouch. Similarly, 95 Richmond, listed May 2007 at $8.895, sold this past April for $7.450. Ouch again.

Of the six active listings, 71 Richmond failed to sell in 2003 for $4.050 and was returned to the market today for $3.795. There's no mention of any changes to this house except that it's now four years older, so I assume that the sellers hope that their desired price has caught up with the market. I suspect that 2003 prices were stronger than today's, and if it didn't sell at $4.0 then ... we'll see.

25 Richmond, a building lot, seems to be priced fairly at $2.095 but it's been on the market for the past year so what seems fair to me is obviously wrong. Keep cutting.

34 Richmond has been sitting, unsold, since November '06. The sellers have reduced the price from $6.975 to $6.450 but I don't think that's going to do the trick.

37 Richmond was bought in August 2003 for $3.6 million and is now back on the market asking $7.450. Again no mention of improvements, so this seems, er, aggressive.

The Mortgage Mess
Yesterday saw the Feds promise to bail out Fannie Mae and her siblings with you and me footing the bill. No surprise here - the Wall Street Journal has been predicting exactly this outcome for at least a decade - indeed, as the result of very bad political policies, this outcome was inevitable. But I don't see an alternative, now that Fannie is the only entity providing liquidity to the home lending market; while it (she, he, whatever) holds or guarantees 1/2 of existing mortgage loans, its share of new loans has soared to 70% - no one else wants to participate in the market. It took twenty years to dig this hole; let's hope it doesn't take twenty more years to climb out. I'm posting this before Wall Street has had a day to digest the news but I'm curious to see what its reaction will be to today's Fannie Mae auction of $3 billion in bonds. Hold onto your hats, and here we go.

Mega Mansions begin their decline?
The New York Times reports (and a large ad in yesterday's Greenwich Time announced) that a huge (the Times claims 26,000 sq. ft but that may not include the basement or, as such things are called at this price range, the "lower level) mansion on Taconic Road is on the auction block for $19,000,000, a sharp reduction from its original asking price of $31,000,000. I believe I wrote about this place when it came on a year ago. If memory serves, I thought it was too big for practical living and certainly that's what its owners think now. I once wondered in print what would become of these monstrosities when tastes changed and an older reader from the Back Country relied, "the joke in my peer group is that there will be no shortage of nursing homes when we need them".

There are still buyers for these things, of course, but fewer of them and I would think that even a multi-millionaire might question the wisdom of heating 20,000 sq.ft. with $5.00 per gallon fuel oil. Judge Judy is completing an enormous house for herself on lower Round Hill Road but aside from that (and it's rumored that she's paid $1,000,000 per episode, 50 weeks a year) I'm not seeing a lot of activity. Another article in the Times today focuses on the trouble investment bankers are having getting past co-op boards in Manhattan. It seems that the boards, like the bankers themselves, are just discovering that humongous annual bonuses don't necessarily appear every year. Plus, lenders no longer will count the bonuses as income and are demanding much larger down payments, so buying power is down. Jesus weeps, but if the bonus babies disappear, our Greenwich market will suffer alongside NYC. I think we're in for an interesting year.

Who Knew?
A reader has corrected my spelling of "just deserts" which, contrary to what I thought I knew, has nothing to do with a sweet tooth and therefore deserves just one s, and not two. Check the link below for a full explanation of this phrase's origins and correct spelling. Learn something new every day.

Death Watch
I've been keeping an eye on a listing on Ridgebrook Road (near Greenwich Academy) which came on in April for the surprising price of $6,950,000. Surprising because, while it's a nicely renovated house in a close-to-town location, it didn't seem - to me - to compare favorably with other houses in that price range. I'll give the sellers this much: realizing their mistake, they've sent the place plunging through the price strata and today it dropped again, to $3,995,000. Is that its final resting place? I bet not, but I'll report back.

No wonder hedge funds are in trouble - the managers are stupid!
Reuters reports (see link, below) that hedge fund managers are donating huge amounts of money to Obama's campaign. The "news" service claims that this is a break from the past but I want to research that a bit - its my memory that the Street's gone Democratic for years. But if the managers of this failing and flailing industry are really supporting a candidate who promises to tax the hell out of the middle class, impose a disastrous national health plan on the country, curtail fossil fuel production and walk away from the Middle East, it's hardly surprising that they're also making dumb bets on complicated things like CDOs. Just desserts, says I - remind me to wipe a tear next time another one of them goes belly up.

UPDATE: desserts (which one eats) have two "s's", sandy spots just one. I plead guilty on the other error, now corrected.

Boys just wanna have fun
The wiffleball controversy continues and, while yesterday I expressed a certain ambivalence while judging the rights of homeowners to enjoy peace and quiet (as though that exists in crowded Riverside), I was dismayed to read in today's Greenwich Time that the Boy's Club has offered to step up to the plate and organize a wiffleball tournament in some other, more suitable location. Yeah, that's what we need, yet another program structured and run by adults. God forbid we let kids figure out what they want to do on their own.

Meanwhile, I see that the town has just finished erecting a cyclone fence on the corner of the Post Road and Carey Road in Riverside, thus effectively blocking (for now) access to the rope swing over the Mianus. For years (certainly dating back to my childhood in the 60's and probably long before that) local kids would hang a rope off a big tree on the bank of the river, close to the dam, and everyone in town under 18 would find their way there to swing into the river, scramble atop the dam and, in general, cool off and have fun. The cops would show up occasionally to cut down the swing and chase us off the roof of the pump house on the other side of the river (great jumping spot) but a replacement would be found, always.

Now they've gone and fenced off the path to the swing. I'm sure resourceful kids don't need my help but I may just drop off a huge pair of bolt (and fence) cutters that remain from my own misspent youth.

Barbarians on the field!
Our little town has achieved front page status in the New York Times (check link - I think it's working) via an article by my friend, Peter Applebaum. Peter wrote a fair and balanced story covering the issue but I tend to side with our town's chief of police who is quoted in the Greenwich Time this morning as disapproving the kids' argument that it's a choice between whiffleball and heroin. Reminds of that idiotic ad campaign in the 60's (or maybe early 70's) showing an unattended car with its key in the ignition and the tag line, "don't help a good boy go bad". I was very much not good boy during that period, but even I could appreciate that good boys wouldn't be tempted to do evil by the sight of an easily-boosted car.

I sympathize with both sides here. The kids were bored, and Greenwich is truly boring for kids of that age, so they did something about it in an enterprising way. The neighbors want peace and quiet, however, and that's being ruined by the noisy games. It will take a wiser man than I to decide this one fairly - in the meantime, the neighbors could pray for rain.

UPDATE
One commentator below expressed disappointment that I don't side more strongly take the kids' side - I was focusing more on the dumb threat one of the kids made that, if they weren't allowed wiffleball they'd just turn to drugs, but the merits of the case itself probably fall in favor of the kids. Heck, we had a pretty-much non-stop baseball game going on in my backyard in Riverside long ago, with an ever-changing lineup as local kids showed up, played a few innings and went on to other things (drugs and alcohol? I think we were too young) and were replaced by the next player. I'm sure our games made a lot of noise but somehow the adult neighbors survived and amazingly (this was 40 years ago, in another era) never complained. For that matter, and again to demonstrate how different is the world we live in today, we had at least two broken arms from bat-body collissions, another couple of broken arms from kids falling out of the big tree in the outfield, and not one of the parents brought suit. Imagine that.

Apples to Apples?
It's often difficult to calculate price increases in the market because so many older houses are bought at one price, completely renovated and then placed back on the market. If they sell for a higher price, how much can be attributed to shiny new kitchen appliances, master baths and granite counters versus the general upswing of the market itself? So it's nice to find an untouched house and see what's going on. One such example is 228 Stanwich Road, an older house in need of renovation that sold for $1,700,000 (from an original asking price of $2,125,000) on August 30,2007. The new owners did nothing to it and changed their mind about holding on to it so today it was returned to the market at $1,895,000. Has the property really increased $200,000 in value? I personally doubt it, but I'll watch what happens and let you know.
196 Bible Street sold on June 14,2007, for $4,050,000 and after being re listed in November for $4,555,000, untouched, was dropped today to $3,850,000. There's an owner who has some grasp of current market conditions, I think.

Then there's 23 West End Avenue, new construction right next to the Old Greenwich sewage pumping station. The seller originally asked $1,895,000 and the house sat unsold, despite its description as "abutting town land" (might have worked for noseless, blind buyers). It remains unsold, three years later and today was listed for $1,649,000. The builder owner is getting there, but now he's selling a three-year-old house. Tough to get new construction pricing under that circumstance.

Mortgages in Greenwich?
A reader expresses surprise that we have such things - "I thought everyone paid in cash?" Hardly. First, if the median price for a house in town is around $2,000,000, that leaves plenty of houses for sale in the $450,000 - $2,000,000 range to be purchased by folks who, if they lived in Zimbabwe, might be considered wildly rich but here in Greenwich are probably just struggling to get buy. No college scholarships for most of these people, but lots of taxes and more on their way - someone has to pay for Obama's largess. Second, even wealthy people don't like sticking a huge sum of cash into a relatively illiquid "investment". I know many instances where buyers of multi-million dollar mansions took out 80% mortgages. either because their stock holdings were restricted or they just didn't want to part with their cash. I've got a call in to a couple of my mortgage broker friends but I'd bet at least 80% of all house sales in town involve a mortgage, even though the current tax law disallows any interest deduction after the first million (at least, I think that's still the law - not being in quite that category myself, I haven't checked recently).

Here's a price reduction for you
45 Baldwin Farms South was brought to market in January for $9,750,000. Very nice house but an inadequate yard, in my opinion, for that price range, and stuck on a flag lot (long narrow driveway that runs forever before finally reaching the lot itself). Today it was reduced 30% to $6,995,000, or nearly $3,000,000. Not necessarily a sign that the market is collapsing, because, as I said, I never liked its original price, but that's a heck of a whack. For you price per square foot fans, it's a drop from $1,000 a foot to $715. I still wouldn't call it a bargain, but its builder is obviously eager to sell.

The end of my air travel
I thought this idea (electric shock bracelets for all airline pasengers, in case the link doesn't work) was a joke. But at Homeland Security, there is no laughing, ever.
http://www.washingtontimes.com/weblogs/aviation-security/2008/Jul/01/want-some-torture-with-your-peanuts/

Market Timing
One reader points out that, if prices are likely to continue falling for the next year or two so it's better to sell now, than then. Another asks the entirely sensible question, so is this not the time to buy? The best answer I can give is, "who the hell knows?". If you want to sell your existing house and buy another, you might as well do it now. If you don't have a house to sell, waiting a year could yield some financial benefits. But people go broke trying to time their Wall Street investments and you could hurt yourself trying the same thing in real estate. What I've always suggested to my clients is that they look at a house as a place to raise a family and find shelter from the storm. If you want or need a new house and find one you like go ahead and buy it now. Prices have dropped and most (many, anyway) sellers are realistically flexible. If you don't need a new house right now, you might want to wait to see what happens over the next year. One caveat: the home lending market seems to be falling apart and, a year from now, you might find it much harder to obtain a mortgage.

Daily Rant
I heard a perfectly rational-sounding fellow on Connecticut NPR yesterday discussing all the wonderful new energy sources that will power our state and, by extension (pun intended) our country. Wind, solar, electric cars, you name it, it will all be along soon to keep us warm and scurrying about. In the meantime, of course, there must be no new production of energy sources from "old" technology, such as coal, oil or natural gas. I look forward to the day when we can tell our Arab friends to pound sand but experts like the one on NPR never address one basic question: how is all this great stuff going to be delivered to our state and who will tolerate (and pay for) the necessary infrastructure?
Connecticut has fought, and defeated,mostly, every effort to bring more energy here. We don't want gas pipelines running across our fields or Long Island Sound; no new transmission lines, anywhere, no liquid gas barges six miles out and, of course, no nukes! So okay: somewhere in Texas, they're planning a million acre plus solar energy installation. Good for Texas, but that leaves us in the dark. Plug-in electrical cars would be wonderful, but where is the electricity to charge them?

In South Africa, gold mines are shut down, bakeries are closed, schools are operating in the dark because of periodic, daily blackouts that come and go at unpredictable times. The country's leader admits that there have been warnings of exactly this happening for the past 11 years, but the country found other uses for its limited funds. Now those funds are even more limited, because gold mining was a huge source of income.

The folks in charge of predicting the Washington D.C. - Baltimore region's energy needs - not mouthpieces for the energy industry but honest-to-God citizens - said last week that in less than 3 years the region can expect the same sort of blackouts now afflicting South Africa because no one will even begin to consider a permitting process to bring in more electricity from the west. We're not talking about the actual location of such transmission lines-that's whole'nother fight - just the concept itself-a beginning of a discussion. I can only hope that Washington goes dark and its politicians go home but the howling from down there will certainly reach us here in Connecticut, especially because our own TVs and radios will have shut down,I-95 will be traffic free, and we'll all be living in blissful buccolic quiet.

Go have a talk with a Green and ask them how they propose to power the country. They'll tell you of the wonder of wind farms, ignoring the fact that the wind don't always blow and Teddy Kennedy and his ilk won't let them be located anywhere nearby. They like the idea of hydrogen cells and ignore the sad fact that to make hydrogen you'll need some form of energy, perhaps from those non-existant wind farms. They're happy to tell you what they don't want: no more oil drilling, either offshore or onshore, no Canadian oil from the oil sands and again, no coal, no nukes, no gas - it only encourages Big Oil and encourages them to keep up their evil ways. Biofuel is turning into an embarrassing mess (as predicted in this column repeatedly over the years)but something is bound to turn up, just in time - wait and see (I actually heard a caller complain yesterday that Detroit has sat on a super-secret engine that yields 120 mpg for 30 years, just to force Detroit's customers to pay more for gas. That same rumor has been around all of my life and, according to my mother, at least since 1930, so I guess it must be true). Greens believe in pixie dust and fairy magic and what's scary is that they seem to be prevailing. I don't much care that 53%of Americans believe that the US government attacked the World Trade Center on 9/11 and a larger percentage think Elvis is alive but when that same horde shuts down our economy's engines, there will be hell to pay and we're all going to be forced to make that payment.

More on pricing per square foot
A reader asks (see comments) "So land is not a variable in the square foot method? Where does it fit it, or is it added as a premium to the overall price?" Not quite, but when I'm using the method as a rough tool for measuring value, I just lump the land value into the total asking price and see what turns up. Again, though, you have to be sure you're comparing apples to apples. For instance, a building lot in Havemeyer that would support a 4,000 sq.ft. house might sell for $750,000 (sad news for Havemeyer residents who a few years ago might have expected as much as $900-$950K, but that's what's happening). A similar lot in Riverside, south of the Post Road on a decent street might sell for $1,350,000. That's a land cost of $187.50 per sq. ft. for the former, $337.50 psf for the latter. Assuming (dreaming, perhaps) that you could sell that Havemeyer new construction for $2,000,000, total cost for a 4,000 sq.ft. house would be $500 per sq. ft., including the land value and a $2,750,000 house of the same size in Riverside (ignoring the fact that buyers of new construction in Riverside prefer 5,000 sq.ft. and up) would cost $687 per sq.ft. for what I am assuming is the identically-constructed and finished house. So land value does play a role, but if you're comparing two new houses in Havemeyer or two new houses in Riverside, you can (sort of) ignore the land value.

But builders don't.I've seen houses in Havemeyer priced at $950,000 being pitched as ideal building sites. The math won't work for a builder. Figure $200 per square foot construction costs and $100,000 soft costs - interest, lawyers fees even, God bless them, real estate commissions - that's $900,000. Add $950,000 in land cost and the builder's up to $1,850,000 before he even tries to sell his project for that hypothetical $2,000,000. Consider the likelihood that he'll have to sell for less than he's asking in this market, and he's risking a huge sum for a small gain. So, not surprisingly, land values are dropping. Not to nothing,but dropping all the same. My advice for now is, if you aren't in a rush to sell, postpone.

June Inventory
Courtesy of my friend John Cooke, here are the latest numbers for our June inventory of single family homes (click on the image and it should enlarge for easy reading - hope you're as impressed as i am that I figured out how to upload this as a jpeg).

Look at the homes between $7,000,000 - $8,000,000. Up 128%. If I were a mansion seller, new or old, I'd be nervous. In fact, anything priced over $4,000,000 would have me checking my bank's lending policies.

Price per square foot
A reader asked me to comment on this method of valuing a house and I'm happy to do so. When I went house hunting in Boulder CO a few years ago I discovered (a) that land use laws have driven prices way above even Greenwich and (b) new houses are sold by the square foot. My Realtor showed me various developments on the plains (the hills of Boulder itself are long since built out) and described them as "$200 per square ft. houses", or "$400 psf houses". and so on. Worked for me, but here in Greenwich, it's not so easy.
Some of the problems with using the method here are the variables. A house north of the Post Road in Riverside or Old Greenwich will obviously not command the same price as one south of that road, so the land value will be less, the builder, if he's smart, won't put the same finishes into the house, etc. Still, withing a discrete neighborhood, and adjusting for precise location, it's not a bad tool. But watch out for builders' calculations of square footage, because some add the basement to that measurement while others do not. Finished or not, a basement just isn't worth the same as finished space above grade. I work with a client, Greenwich Construction Company (just in the way of full disclosure here) who never includes the basement space in the square footage calculation. They (and I - remember the above disclosure) sold 4 new houses in Riverside last year for between $635 and $675 psf. That's up quite a bit from a few years ago, when I did a survey of new homes sold in Riverside and found an average price of $565. Unsold new houses at that time averaged $665 and never did sell until they dropped below $600. We've seen some big increases in land and building material costs since then, so that probably accounts for the jump.

It's tougher to use this method on existing houses but, with the possible exception of Conyer's farm or high end direct waterfront like Meade Point or Field Point Circle, any house asking more than $1,000 psf is usually doomed to sit for a long, long time. This is not a widely-known fact, judging from some of the prices I see out there.

Any builder knows his numbers and they all use pretty much the same figures. Land is "X", and varies with location and size, but basic constrution costs are about the same - the huge differences come when finishes are selected. Buyers all want granite counter tops (why?), Sub-zero appliances why again?) and so forth, but add a mahagonny panelled library and such and you start piling up the money. Your choice of either a slate,cedar or asphalt shingle roof can easily make a $100,000 difference, and that's before you've added those copper gutters and downspouts.

All that said, it is indeed possible, and not at all foolish, to take a selection of comparable houses, divide their square footage by their asking price and see which is the better value. So long as you make certain you're not including one building's basement and not the other's, you'll end up with a useful gauge. Of course, it helps if you like the house, too.

Fireworks!
I wasn't going to attend the Binney Park fireworks Saturday night but I remembered that it's been Chip Kreuger's Greenwich Capital that's funded these shows for the past decade and Chip sold his company to a Scottish bank last year who, in turn, isn't having such a great year this year. It might be a long time before we see such corporate largess again, so off I went. Not a bad show and enhanced by the presence nearby of two small boys going "oooo, ahhhh!" after almost every explosion. I'm way too coll at my age to express such sentiments, but I was right there with them. The grand finale was the best in my memory so, all in all, a good 1/2 hour well spent. I just hope it can continue - the old funding model of volunteers with fishing nets soliciting contributions during the Memorial Day parade stopped working long ago, which is why Kreuger stepped in. Thanks are due.

Ada's
Ada Cantavero, who ran a little candy store in Riverside forever, has finally died at 88. Funny, but Ada seemed ancient in 1960, when I was just 7, and then seemed to stop aging. When my brother Gideon called with the sad news my first question was, "how old was she?" "104", he replied, and I actually believed him. But she was great.

When I was a kid, penny candy really cost a penny and there was nothing worse than being stuck behind some rich kid with a buck to spend, calling out his selections one by one. Most of us had a nickle or maybe a dime to spare, so the line usually moved quickly, but if I bear any resentment toward the rich, it probably originated here.

Ada would let us hang out on her front porch but any misbehavior risked at least a temporary banishment, a terrible threat that kept us in line. When kids had trouble at home - a divorce, drunken dad, whatever - she'd comfort them and cheer them up and provide a refuge. A heck of a woman and one who seemed to remember all of her kids, no matter how much time passed. I stopped by maybe five years ago to say hello 25-30 years since my last visit and she greeted me, "Hi, Bobby!". Bob is my older brother, but the fact that she could place me in the right family was amazing. Riverside has lost a wonderful institution.

More on moderate housing
Something many of us don't know (I certainly didn't, anyway) is that what used to be called an "elderly conversion unit" - a separate apartment with kitchen - and which could be built and occupied only if at least one of the occupants of either the main house or the apartment was over 62, was changed to the term "accessory housing" and now permits occupancy by tenants of "moderate income". I don't know what the income guidelines are for this exception (it's adjusted from time to time) nor whether it applies, as does the age requirement, to either the main house or just the apartment, but a call to the Zoning Board (call Town Hall at 622-7700 and ask for Zoning or go to the town's website and enter "accessory housing" into the search feature) will answer those questions. Yes, I'm still working on links here - a new project I'm involved with may soon provide an entire website entirely devoted to Greenwich news, opinion, neighborhood association news, etc., so if I'm going to be changing formats, ...) In any event, from what I'm told, teachers, firefighters or policemen would probably qualify as moderate income. Any one of those groups could provide a nice pool of good tenants. You could make some decent money, have live-in security and know that you're doing your small part to provide additional housing in Greenwich, all with the town's blessing. Not a bad deal.

Price Drop?
One of our commentators asks, "is a house that was worth $7,500,000 last year now worth $6,500,000? Certainly not in the case of the Thunder Mountain Road house I mentioned yesterday. In that case, the house was never worth $7,500,000, it was just an imaginary figure dreamed up and reported by a broker trying to protect its client's other project on the same road. Although, it must be said, the average price has dropped 14% this year and that would neatly place a $7,500,000 house at $6,450,000 so perhaps the argument can be made. My point about Thunder Mountain Road is that, since there never was a genuine sale at the reported price, it's impossible to tell. Certainly, if you bought a house last year and want to sell it today, brace yourself for some bad news. If you bought before 2000, relax and enjoy your sizeable gain. Anything in between, it's a guessing game, but it could get ugly out there.

580 Lake Avenue

This house came on the market in January 2006 asking $5,550,000. 2 1/2 years later, it sold yesterday for $2,685,000. I continue to be amazed at how wrong some prices can be.

Foreclosure in Greenwich
There's an interesting comment below on affordable housing, with several good ideas on how me might address the problem, if we must. One idea that probably won't work, however, is buying foreclosed houses. In Greenwich they're rare - perhaps two a year. But last Saturday, a house on Round Hill Road did pass via foreclosure. Seven plus acres, some wetlands but, all in all, beautiful land. According to a reporter friend of mine, almost no one showed up: two couples who were apparently under the delusion that they could pick up a Round Hill property for a couple of hundred thousand dollars and a representative of the bank, there to make sure that the lender's $3.9 debt was covered. So it sold for $3,900,000 to the bank, and will presumably be returned to the market soon. It wasn't that long ago that seven acres of Round Hill land (there is a house on the property but not for long, I suspect) for just under $4,000,000 would have drawn the interest of any number of spec builders. Not today.