Modern Furniture That’s Not Hideous

From French furniture company Roche Bobois. Possibly not something I would do in MY home, but…

A typical suburban real estate agent inspects a minimum of 10 houses per week, often it’s twice that number. That simple fact is the reason the job category “real estate agent” still exists. All that time and effort spent studying, analyzing, discussing with fellow brokers, and watching individual properties go through the sales process from start to finish, makes an agent a valuable person.

If you were foolish enough to ask a denizen of Manhattan “where’s the best fishing spot between Tod’s Point and Indian Harbor”, the Manhattanite wouldn’t have a clue. Similarly, people who merely watch real estate from the comfort of their office swivel chair can certainly have opinions about what a house is worth, but they are not useful opinions.

But where was I? Oh yes, modern furniture! So, with all that house-looking, we brokers encounter an awful lot of hideous glass and steel tables, steel chairs and bookcases (with no books), white shaggy couches, and of course, faux zebra throw rugs. Gets tiresome.

One sees more and more of THIS…

and less and less of THIS… (maybe that’s a good thing?)

It is therefore amazing that I have stumbled upon contemporary furniture that even I must admit ain’t bad looking. See if you agree: RocheBobois

(It’s a French furniture company, looks like the nearest showroom is on Manhattan’s upper west side, at 2040 Broadway)

 

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Why Are Companies Fleeing CT? Tune in to tomorrow’s show to hear the sad truth.

John Boyd Media Pic

John Boyd, Jr. of the Boyd Company, location consultants, i.e. “the executioners”, from the standpoint of CT politicians. But don’t blame Boyd!

Companies have been fleeing high-tax/high-regulation Connecticut for years. They won’t stay here, they won’t move here, they certainly won’t start here. Nope, there’s no escaping the fact that our once-great state now sends a very clear message to the business world: STAY AWAY.

What can be done? On tomorrow’s radio show, I will interview John Boyd, Jr., Principal of The Boyd Company, which consults major companies on site selection. As you can imagine, by the time a CT company contacts Boyd, they have already decided they’re going to move, so Boyd helps them pick a state with the most favorable tax and legislative climate.

I’ll be asking John if there is any hope for our dopey state, and what realistically could we get (those idiots up in) Hartford to do to fix things.

Tune in tomorrow morning Wednesday, Feb. 21st, 11:00 AM -12:00 PM. The interview with Boyd starts around 11:30, before that, Jonathan Wilcox and I will discuss the Greenwich real estate market and why, oh why, should it take an average of 320 days to sell your damned house?

Gid’s radio show, every Wednesday morning, 11:00-12:00. On your radio, it’s 1490 on the AM dial. On your computer/mobile device, go to http://www.WGCH.com

Gid’s Big Media Break

Yesterday morning at the glamorous downtown Manhattan studios of WOR Radio. Gideon and Susie , guests on the great Mark Simone Show. This WOR complex hosts about a dozen of the hottest radio stations in the country. (The internet not only didn’t kill radio, it gave it a 2nd life)

After donating a sufficiently large amount to “Charitybuzz” * , I obtained the right to appear on WOR’s Mark Simone Show, 710 on your AM dial (or online at iheartradio.com). I’m used to pestering a few dozen people at a time with my, er, wisdom, but this was the first time I got to inflict myself  on MILLIONS of listeners.

And that part was a complete surprise, my expectation had been that all I’d get to do was sit behind the glass and stare at Simone while he did his show, but no, Susie and I got ushered into the studio and I was interviewed like any other guest.

Mark Simone is one of the world’s best interviewers, he could interview a ventriloquist’s dummy and make the dummy sound like a genius, so naturally, I think I came out of it looking good! Did it help that he restricted the question subjects to Greenwich real estate and related matters? Yes, since that is what I know, it certainly gave me an advantage.

Anyway, click on the hyperlink below, listen to the Podcast, and see what you think:

(my episode is number 3 on the list, titled “Charitybuzz winner”)

https://itunes.apple.com/us/podcast/mark-simone-show/id1253585516?mt=2&i=1000402483767

Charity Buzz is a legitimate, for-profit internet company that raises funds for nonprofit organizations through online charity auctions. They have amazing stuff to bid on, like appearing on radio  and TVshows, golf with Jack Nicklaus, NASA zero-gravity experience, yacht cruises, you-name-it. Very cool.

Your Real Estate Has Two Prices

A recent sale of Riverside waterfront property saw $3M+ left on the table.

There is the price you can get in the first few weeks of  your listing, and there’s the price you get after sitting on the market for months and years.

A Greenwich seller has left $3,100,000 “on the table”. He was offered $9,600,000 two years ago, turned it down, and ended up accepting approximately $6,500,000 last week. It’s a classic case, not at all unusual in our market. In fact, the next example is likely right around the corner!

Here’s how it works (every single time):

  • Seller over-prices property.
  • Seller turns down early offers.
  • Seller waits months, possibly years, hoping to hear those offers again.

It’s such a common scenario that one can only conclude that this behavior pattern is built into our DNA.

Will you fall into this trap when it’s time to sell? Yes, you will. What about brokers? Surely they are experienced enough to avoid such foolish behavior when they list their own property, no? No. Brokers are even worse!

At any given time, the Greenwich market contains a dozen or so broker-owned properties that are for sale and they are almost always over-priced. And they sit, and they sit, and then? They sit some more. Experienced brokers commit the same error that they (presumably) have warned their clients of.

Remember that book  Freakonomics? It is full of interesting, useful, surprising facts about human behavior, but I had to laugh at the section devoted to real estate. According to the authors, real estate agents deliberately price your property low so it will sell quickly (oh no!), whereas, when they go to sell their own properties, they price them higher (gasp!). This hideous crime was apparently revealed by the authors’ study of real estate sales statistics in the Chicago area.

Maybe there’s a different type of human in Illinois, but here in CT, while it’s certainly true that brokers price their homes higher, it is also true that the market punishes them just as severely.

The corrosive effect of sitting on the market for months and years is so obvious, so proven, it is a wonder to me that professional appraisers still  don’t acknowledge it in their reports.

So here’s my ground-breaking proposal: Every real estate appraisal should come with two prices, the “early” price and the “late” price.

A sample concluding sentence of an appraiser’s report  might look like this:

Based upon recent and similar market transactions in the area, the market value of the subject is estimated to be in the $5,000,000 to $5,300,000 value range. In the event that the subject remains on the market for 6 or more months, the stated value range should be reduced by approximately 20%.*  

This would at least put banks, lawyers, and estates on notice. Heck, it might even end up influencing the behavior of sellers and brokers!

 

* That 20% drop is only the beginning, of course. After a year or two, your value can easily drop a total of 40-50%!

 

 

What’s Selling Well In Greenwich Right Now

75 Rock Maple, Greenwich (off Stanwich Road), $5,695,000. Came on May 24th, already has a deal! This was a very smart asking price. We’ll have to wait for the closing, but I won’t be surprised if it had a little bidding war.
List: Helene Barre
Sell: Max Wiesen

You want the truth? You can handle the truth, so here it is: houses priced $5,000,000-6,000,000 are trading quite nicely, thank you. How many? So far this year, we’re up to 11 closings, with 6 more pending. For all of 2016, we had a total of 12, so there, my friends, is another clear indicator of that “zippy” market I talked about..

There is a theory among brokers that these $5M-6M buyers are “yesterday’s $10M buyers” who are now spending less not because they don’t have the dough, but more out of a sense of caution. This could be true, I’m not sure, but as I wrote yesterday, I’m certain some percentage of $10M buyers just aren’t here anymore. They’ve stayed in Manhattan or they’ve gone to places like Florida.

Now consider this: If all the Greenwich property owners with houses on the market for $10M+ (there are 41 of them) suddenly decided they needed to sell RIGHT NOW, they would need to slash their asking prices by millions. That would quickly drive down the price of all these houses presently selling in the 5’s and 6’s.

But guess what? High-end Greenwich property owners almost never really “need” to sell. That’s why we have so many on the market celebrating their 5th anniversary, 6th, 7th, all the way up to a few that have been on for FOURTEEN YEARS. So all you sellers in the $5M+’s? Relax, your market value is safe.

 

 

 

 

Will The High-End Drag Down Everyone Else?

If no one buys this Bugatti Chiron for $2,998,000, will that hurt the sales of $90,000 Mercedes Benzes? Gideon says no.

I was belly-aching about the lack of high-end ($7M+) sales the other day to my friend* Chuck Royce, who certainly knows things, and he said “We lost 300,000 financial jobs and those buyers just aren’t there anymore”.

I won’t argue with the Voice of Royce, certainly the government-caused melt down of the housing industry, followed by the near collapse of the financial sector, took a terrible toll on jobs in the investment business.  But I still think there’s more to this. After all, there are now PLENTY of young couples out there getting into bidding wars over $2M tear-downs, particularly in Riverside and Old Greenwich. It’s one of our busiest segments, and consider the money being spent: they’ll pay anywhere from $2M to $4M+, just for the land, then spend $2M-3M to build the dream house.

Take the folks who just paid $4,325,000 for the right to tear down 206 Shore Road, Old Greenwich: they will be all-in for around $7M when they’re done building. Does that sound like a weak market?

No, what’s going on here besides Royce’s observation of 300,000 eliminated jobs is that young buyers, more than ever, want brand new. That means if you dumped millions into a property 15 years ago, you may not get that money back. Maybe your $12,000,000 house is now only worth $7,000,000, but the buyers are there. Their tastes have changed, but they do exist!

We notice this loss of value most in our extreme high-end properties, but will that erosion inevitably drag all the other prices down? I say no. It’s like the Bugatti example above. Prices in the rarefied categories, whether it be art, property, or automobiles, don’t really have much influence on the rest of us.

 

*You qualify as my “friend” if you can reliably pick me out of a police line-up.

Hanging Wit Da Brokahs OR… My Trip To Florida

The legendary, but still hip, Fontainebleau Hotel, Miami, Florida

Like me, you can think of nothing more fun and exciting than going to a Realtor’s convention and hanging out with a gaggle of Realtors. It’s “gaggle”, isn’t it? Pride of lions, pod of whales, eye of newt, gaggle of Realtors?

So down to Florida I jet, staying at the fabulous Fontainebleau, which I hadn’t seen since watching James Bond saunter by the pool in the movie “Goldfinger“. See those pictures on the website of wonderful ocean views? My view was more parking lot and some sort of inland canal, but still, over all, very nice room.

So NOT my view…

This chap talked about international real estate markets, actually interesting, I swear!

Hangin’ by the pool…(there were eight or nine different ones)

One of two iguanas that lived in the palm trees next to this pool. Note to iguana fans: have you ever seen a better set of caudal spines in your life?

Almost all of my time was spent in various “seminars” but it wasn’t as bad as that sounds. Years ago, I went into NYC to attend some Coldwell Banker broker thing, and the whole time was spent listening to lectures on sales technique, how to ask “tie down” questions, and generally how to steer hapless customers towards a sale.

This was anything but. The brokers I met with are all dominating their local markets and all of them are NOT working for national firms. There entire focus was on “building their brand”, which every broker needs to do, regardless of who you work for.

Still awake? Ok, so besides real estate, they also had interesting speakers like thriller-writer Brad Meltzer, who talked about extraordinary individuals like the cops who started the Make A Wish Foundation, and how maybe you’re not going to do anything that big, but you can still find a way to improve the lives of others (can you imagine such poppy-cock?). But seriously, I liked Meltzer’s speech the best.

I wonder if anyone here suspects I’m a white guy from CT!

 

Come on, who wouldn’t want to pose with a camel!

That building had the views…

Great spot to sit around and smoke a thoughtful cigar…