Dear Editor: I view with concern and alarm
State of the market
Brother Gideon writes,

I keep running into listing brokers who are getting "ridiculous" offers on their houses. Seems like people are trying to buy but Greenwich sellers aren't impressed.

All very possible - I don't know, obviously, what these offers were, and I'd advise you to run your potential offer past a good agent to see whether you've veered across the line from painful but acceptable into, "see you in Hell" land.

What I do know, however, is that I passed along some offers a few months ago that were scorned by sellers as beneath their dignity to reply and, today, those offers would look pretty good. So ....

Off to the open house tour. A quick look at the hot sheet seems to indicate that sellers still aren't getting it, but perhaps I'll be pleasantly surprised. If so, you'll read about it here, first.

OwlGore urges
civil disobedience to stop construction of coal-fired power plants

I assume that he'd like to see us emulate England, where vandals were recently acquitted of trespass and violence on the grounds of "self defense" - they were, according to a British jury, just trying to save their own lives and that of everyone else in England by ending global warming. Gore, by the way, approves of this violence at any plant, anywhere in the world, thus distinguishing himself from that other great orator, Joe Biden, who supports coal-fired plants so long as they're in China or India or some godforsaken place populated by foreigners.

What struck me about OwlGore's speech to young terrorists, aside from his advocacy of shutting down the world's power supply, was this:

"I believe for a carbon company to spend money convincing the stock-buying public that the risk from the global climate crisis is not that great represents a form of stock fraud because they are misrepresenting a material fact," he said. "I hope these state attorney generals around the country will take some action on that."

Now, the man did attend law school, even if he borrowed Teddy Kennedy's notes, so he should know that our Supreme Court has long recognized the right of commercial entities to engage in free speech; his desire to see "carbon companies" (by which I assume he means most businesses in the United States) hamstrung by lawsuits in 50 states (or 57 states, if Obama's right)seems a bit ... ignorant, therefore, if not malevolent. According to Gore and his friends, the debate over global warming is closed and anyone who says otherwise should be prosecuted, but those darn scientists keep coming up with data that suggest otherwise.For instance, yesterday's NY Times reported that the permafrost isn't melting after all and in fact, has survived numerous periods of warming before. According to scientists, (reported by my cousin Henry Fountain but I assure you, Henry is as on board with OwlGore as the most befuddled college freshman) the ice up there has hung around for at least 740,000 years.

But Gore did win the Nobel prize, they tell me, and he's got the 100', diesel powered houseboat to prove it. What a guy - can't we persuade him to be our president? Air Force One may be a tad smaller than his current jet but when it comes to sacrifice, Gore understands. And when he doesn't, Barbara Streisand can explain it to him.
Streisand Eco-Cottage

Rain on the parade?
7 Dwight Lane
This place is to be sold via IRS auction Friday at noon, minimum bid $2.5 million. I reported before that the auctioneer claims his only problem is that he only has one of them to sell and that buyers are lined up out the door. Maybe. I'm going early, with camera, and hope to interview potential bidders. I'll report back on what happens and what sort of pharmacological inventory they used before bidding.

15 Shoal Point, Rvsd
The acid test
This house sold, finally, for $3.275 in 2005, $1.0 million less than its deluded builder originally asked. It's newly back on the market, asking $3.3 million. If the "15% off 2005 prices" theory is accurate, the selling price should be $2.783. I hope that, just this once, I'm all wet and that the house sells for a new record. It's right up the creek from me and as that great tax cutter JFK once observed, "a raising tide raises all ships".

When in danger, when in doubt, run in circles, scream and shout
The Wall Street mess
Rather than pass out a trillion dollars to the same wonderful folks who strove so mightily to bring about our and their own ruin, why not cut taxes by the bucketful and see what happens? I bet we grow our way out of all this. And if I'm wrong well, just think how cheap Greenwich real estate will be.

For a more cogent article along somewhat the same lines, try this.

It could be that a Congressional rejection of the bailout proposal, rather than clogging the markets, will unclog them. If Congress goes home having sent financial institutions a clear signal that there will be no bailout of any kind, then sellers will bring their securities to market, and we will find out what the market thinks they are worth.

In the worst case scenario, the market will assign low values to the securities. Firms that are sufficiently capitalized to hold mortgage securities will earn profits at the expense of weaker companies that have to sell securities or go bankrupt. In the end, it may turn out that the winners really took advantage of the losers. That is capitalism at work in financial markets.

Or this:

"I must tell you, there are those in the public debate who have said that we must act now. The last time I heard that, I was on a used-car lot," said Rep. Mike Pence, R-Indiana. "The truth is, every time somebody tells you that you've got to do the deal right now, it usually means they're going to get the better part of the deal."

(I suspect that you can profitably use Rep. Spence's advice the next time you talk to one of us real estate agents, too).

83 Riverside Avenue
You missed this one, too
I wrote about this Fran Ward (Shore & Country) listing earlier this summer, praising it as a good deal. It started in May at $1.750, which wasn't crazy, and dropped to $1.599, so I suppose (contract prices aren't reported, only sales)that it went for somewhat less than that. This was the old stable/carriage house for a larger estate and had been completely renovated. Not for those who insist on the very newest of new houses but it certainly matched my taste; I'm delighted that someone else agreed.

Peter Tesei
Okay, that's not really our First Selectman pictured here but the poor ol' guy was panhandling on the Town Hall steps and I felt sorry for him so I posted his image - he'll feel better now, I'm sure, once he gains access to a computer and sees his smiling visage.
Anyway, I did hear Mr. Tesei speak today and he did an excellent job discussing our town's budget and a number of problems afflicting Greenwich. I came away thinking we're in good hands, even if I did vote for his opponent.

Tesei told us that Greenwich sends Hartford $600 million each year in taxes and gets back $5 million. This is particularly distressing because, just the other day, I heard a panel discussion of certain liberals bemoaning the fact that cities like Waterbury hit their citizens with property taxes 5X greater than Greenwich. The solution, according to these redistributionists, was to tax Greenwich more heavily. They ignored the one commentator who pointed out that, while Connecticut's population has decreased over the past two decades, the number of municipal employees has increased 39%. Why cut spending when there's a golden goose down the road, just waiting to be plucked?

The answer to our declining schools, Tesei suggested, was to bring some accountability to the School Board (which, by charter, Tesei can't control). Right now, our two political parties each put just two members up for election every other year and, by default, they are elected. The parties could select 4 candidates and create a real contest at the expense of making the incumbents nervous. Tesei seemed to think this was a good idea and so do I. Go put some pressure on your local Democrats and Republicans and consider running for the Board yourself. And don't forget to toss our current superintendent, Betty Sternberg, out of office next year. She's not to blame for everything bad about our schools, I suppose, but heck - it's a start.

Diane Fox, P&Z head honcho, also spoke. I usually disagree with everything the lady has to say and today was no exception. If she has her way, and she always does, watch out for new, stricter requirements for elevating additions to houses along the waterfront. Ms. Fox has smoked a bit too long from the Al Gore bong and seems to think the sea level is going to rise 50' next year. Fortunately, she'll be there with her regulations to save us.

She also wants to see "affordable housing" apartments built along the Post Road and in downtown Greenwich all for the purpose, she claims, of providing housing for our municipal employees. This is a crock and I suspect she knows it. When pressed on the issue of who, exactly, was going to occupy this housing when cops, firemen and teachers all seem to want what everyone else does: a single family house with a backyard, Fox fell back on 'elderly". Nothing against old folks downsizing, but I wish our town planners would be honest enough to admit that that's who we're building for instead of casting these projects in the glow of a "we're providing housing for our workers" argument.

30 Bayside Terrace
You missed it
When this house (building lot, really) dropped from $2.495 to $1.6ish, I brought it to the attention of every builder and home building client I knew; to no avail. Two other agents who, like me, grew up and/or live near here experienced the same lack of success. Janet Milligan and her client were smarter and now the place is under contract. Riverside waterfront, even Grade B waterfront, will never again be so cheap (I say, hopefully, as a Riverside waterfront owner). Whatever, it was a great buying opportunity.

No surprise here
Existing home sales fell 2.2% in August
Raveis's Greenwich mortgage officer, Mark Hawkins, says that Connecticut appraisers are noticing that house prices have stopped falling in areas outside of Fairfield County. The hope is that we'll soon see that same phenomenon here but I find it a little disturbing: traditionally, Greenwich is the last to feel a real estate downturn and the first to emerge, so something odd's going on - can you say, "collapse of Wall Street"?
Update:
Prices aren't doing so well, either, according to Bloomberg

Get out your checkbook?
Some readers have complained that I'm boring them with reports of price reductions but I keep harping on this subject because it's such a good indication of what's happening in the market and, as a bonus, illustrates the perils of over-pricing your house in the first place. So here we go again. Bored readers are invited to turn to other blogs and return later.
20 Langhorne, an as-yet-unbuilt mansion, has dropped from an asking price of $14.900 million in March '08 to $10.998 today. Same house as promised at the first price, you can now save $4.0 million. I'd offer still less, just to test the waters.

8 Hobart, new construction, has dropped from $7.8 in July to $6.995.
29 Byfield, a financial disaster in the making, was reduced an additional $500,000 today. It started at $9.495 in April, it's down to $5.198. If it doesn't sell now, look for it at auction.

I mentioned 38 Langhorne, unimproved (except for a new septic system) land on Monday questioning how it could be worth $1.2 million last year and $4.15 million on Monday. Coincidence or not, the owner, Mark Mariani, lopped $1.0 million off the price today and now offers it at $3.15

89 Perkins was priced at $5.875 last September and didn't sell - apparently I wasn't the only person who thought its price was ridiculous. It's been dropped $1.5 million and is now asking $4.375. There are still, to my taste, some serious layout issues, but at least the price problem is being addressed.

Fire Sale

So you want to sell your house
A man much wiser than I (a low hurdle), one who's made millions in residential real estate over the past 35 years, told me recently that he saw a house in Florida much larger and nicer than his own, selling for 50% of its original asking price. He sold his current house by cutting 15% off what he paid for it in 2005 (and ignoring the money he'd spent on improvements) and made the deal. His thinking was that, yes, he was losing money on his sale, but was buying a much more valuable property at a bargain price, thereby more than making up what he'd "lost".

That makes sense to me, especially the part about cutting 15% off what your house was worth 3 years ago. And if you can take advantage of this market to switch to a nicer house, so much the better. Money is fungible, after all, so in evaluating your own house sale, pay attention to the other end of the transaction and see whether you net out ahead of the game.

If you're not planning on buying another house but still want to sell your existing home, that theory is still a good idea. Use a good real estate agent to provide the market value of your house - owners themselves tend to be too emotional to do this objectively - then price it at least 10%, and maybe even 15% below what houses comparable to yours are asking. You may have to cut your price still further but at least you'll get the attention of every buyer out there. Yours will sell, while your competitors's linger.

Most disgusting headline of the year
PETA urges Ben & Jerry's to use human milk in ice cream.
My personal theory is that Bush and Cheney have infiltrated PETA and now are turning it into the laughing stock of America, thereby destroying it. Good riddance.

1 Butternut
This one's not on North Street but it's a spec house that was built and listed for $5.895 in April 2005. Still empty,it's available today for $4.350.I don't mean to tell you how to spend your money, but there is a growing number of houses out there that, bought now, are going to look like real bargains down the road. How far down the road? That's the unanswered question that's currently wreking havoc on the market.

A reader asked for a survey of unwanted spec houses for sale on North Street. I found five active listings (plus a bunch of expired which may soon be back).

480 North. Original price $9.5 million, now $5.495, for sale since July 2006.
504 North. Original price 11.75 million, now increased (?) to $11.995, for sale since November 2006.
537 North. Original price $9.995, now $8.25, for sale since May, 2006.
620 North. Original price, $6.390, now $6.4 (?!), for sale since April 2008.
969 North. Original price, $12.750, now $11.5, for sale since July, 2005.

My guess, based on driving around town and seeing a number of jobs nearing completion, is that we'll see more, rather than fewer of projects like these coming on the market. That can't be good news for builders.

What about commercial property?
12 Grigg Street, just off of Greenwich Avenue, is listed for $2.495 million. It's on 0.10 of an acre and has two parking spots. I don't know much about commercial real estate in Greenwich (other than that the big guys insist on being directly on the Avenue - they don't do "around the corner") but this seems high to me. I'll watch its progress and we can learn together.

How low can they go?
Here's a new, exciting blood sport: what's going to happen to all the spec houses in our fair town?

537 North Street came up for sale May 6, 2007 for $9.995 million; it can be yours today for just $8.25. Tomorrow?

"Please, sir, may I have some more?"
Can't we just shoot these guys?
The New York Times reports that the MBA Wizards, not content with a trillion dollar relief package that will bail them out from their stupidity, are scrambling for more. Ugly.

One last shot (for today) at some of the hypocrisy now flowing from Washington
From Kevin Hassett, writing in Bloomberg.com

Greenspan's Warning

The clear gravity of the situation pushed the legislation forward. Some might say the current mess couldn't be foreseen, yet in 2005 Alan Greenspan told Congress how urgent it was for it to act in the clearest possible terms: If Fannie and Freddie ``continue to grow, continue to have the low capital that they have, continue to engage in the dynamic hedging of their portfolios, which they need to do for interest rate risk aversion, they potentially create ever-growing potential systemic risk down the road,'' he said. ``We are placing the total financial system of the future at a substantial risk.''

What happened next was extraordinary. For the first time in history, a serious Fannie and Freddie reform bill was passed by the Senate Banking Committee. The bill gave a regulator power to crack down, and would have required the companies to eliminate their investments in risky assets.

Different World

If that bill had become law, then the world today would be different. In 2005, 2006 and 2007, a blizzard of terrible mortgage paper fluttered out of the Fannie and Freddie clouds, burying many of our oldest and most venerable institutions. Without their checkbooks keeping the market liquid and buying up excess supply, the market would likely have not existed.

But the bill didn't become law, for a simple reason: Democrats opposed it on a party-line vote in the committee, signaling that this would be a partisan issue. Republicans, tied in knots by the tight Democratic opposition, couldn't even get the Senate to vote on the matter.

53 Park Avenue South
Beauty in the eye of the beholder
I've long held a sneaky sort of admiration for the builder of this house because he defied convention and built what he wanted. The only trouble with such defiance is that, eventually, the time comes to sell the damn thing. This Old Greenwich property has dropped from $2.777 million to $2.075 million and still won't move. Either the "right" buyer will finally show up - a rarity in this business, despite what many sellers want to believe - or the price will reach a level that spurs someone into action. Either way, there may be a wait.

Langhorne Lane
One of the most successful Realtors in Greenwich (well, that's my little brother Gideon, but never mind) has commented that the Antares fiasco on Langhorne Lane still resulted in the highest price ever paid for property on the street. Considering that the houses there are mostly rather shop-worn contemporaries, I'm not all that impressed, but others obviously are.

Take, for instance, 38 Langhorne. It came on the market 3 years ago for $2.250 million and finally sold in January 2007 $1.250 million. The new owners tore down the house that graced it, stuck in a new septic system and have returned it to the marketplace for $4.150 million, thus setting a new record for a septic system on the street.

Not to be outdone, the owners of 20 Langhorne have done nothing to the property they bought for $1.9 million (the original asking price was $2.950) and are now asking $2.995 million. Go for it guys - let me know how you make out.