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A Lot Of Sellers Are Taking Hair Cuts Of $1 Million Or More Just To Move On

A report from the Wall Street Journal on Connecticut. “After four years on the market, and three price cuts, a stately Colonial-style home on Greenwich, Conn.’s tony Round Hill Road is being sold in a way that was once unthinkable in one of the country’s most affluent communities: It is getting auctioned off. Once asking $3.795 million, the four-bedroom property will be sold May 18 for a reserve price of just $1.8 million.”

“Seller Isaac Hakim, a real-estate investor, said it is time to move on. ‘We are ready to sell and I don’t want it to drag on,’ he said. After raising their children there, he and his wife moved to Florida several years ago.”

“The seemingly never-ending slump is leading some sellers to accept less—sometimes a lot less. Owners who paid top dollar for their homes in the Fairfield County town in the mid- to late-2000s are routinely selling for less than they paid. Dramatic price cuts are the order of the day.”

“There were 45 properties in Greenwich priced at more than $5 million that had their price reduced by 10% or more in the 12-month period between April, 2018, and March, 2019, according to Realtor.com.”

“Attorney Frank J. Gilbride II said one of his clients recently sold his home for $11.18 million, after buying it for $14.7 million in 2007. ‘We’re finding that the larger back country homes have not been selling ‘ recently, because the new buyers don’t want to maintain 10 acres of ‘ grass,’ Mr. Gilbride said. ‘A lot of sellers are taking hair cuts of $1 million or more just to move on.'”

“Several prominent owners have settled for significantly less. Earlier this month, music executive Tommy Mottola sold his Georgian-style estate for $14.875 million, or 25% off its original asking price. In December, hedge fund executive Ara D. Cohen sold his sprawling 27-room property for $17.5 million—half of what he was seeking in 2015.”

“News of an auction, more typically associated with distressed properties, will likely be an extra punch in the gut for Greenwich area real-estate agents, who have been fighting a tide of negative sentiment in the market since 2016, when Starwood CEO Barry Sternlicht, a former Greenwich resident, declared it to be the worst housing market in the country. ‘You can’t give away a house in Greenwich,’ he said.”

“‘The brokerage community went ballistic,’ said Jonathan Miller, a New York appraiser, noting that the town had invested in a public relations campaign to rebrand the area. ‘Now, imagine trying to tell them you’re introducing the auction concept.'”

“The median price for a home in Greenwich dropped by 16.7% last year to $1.5 million in the fourth quarter of 2018, according to brokerage Douglas Elliman. On the luxury end of the market, characterized by the top 10% of sales, prices dropped by 18.8%. Mr. Miller said that trend continued into the first quarter of 2019, estimating that the median price was down by more than 25%.”

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This Post Has 39 Comments

  1. ‘We’re finding that the larger back country homes have not been selling ‘ recently, because the new buyers don’t want to maintain 10 acres of ‘ grass’

    Cutting grass? Why we had a troll tell us recently that rich people have no problem running the AC with the doors open while they fly around Europe! Now this guy says they’ll dump the shack at a loss so they don’t have to cut the grass?

    1. Rich people don’t care about money Ben. What’s why they are rich. You see when you become rich, you’ll know what I mean. I’m so rich that I have multiple shacks sitting empty and have extra time to troll this blog… rich indeed!

    2. ” because the new buyer$ don’t want to maintain 10 acres of ‘ grass’”fuel

      10 acre$ of THC gra$$ might help with paying the illegal maid$ & land$capers … Heal yer$elf, it’$ medicine!

      1. I heard today CA produced 9 million pounds of pot, yet only consumes 2 million pounds/year.

        There is no future in growing anymore.

        3. Watch Uncle Scam step in to pay these growers to destroy it, or alternatively force us to use it in our vehicles somehow.

    3. Check out the charts for pending sales in Los Angeles and South Bay. I guess the low interest rate cheese isn’t luring mice into the bubble trap anymore. Going to be a lot more realtors driving Uber, if this goes on much longer. The spring selling season is wilting after only one month. It hardly sprouted before it started withering.

      https://m.youtube.com/watch?v=znAQKttCc4A

        1. I believe the rock garden our landlords put in place of where our backyard lawn used to be is an example?

  2. ‘Seller Isaac Hakim, a real-estate investor’

    He he.

    ‘The seemingly never-ending slump is leading some sellers to accept less—sometimes a lot less. Owners who paid top dollar for their homes in the Fairfield County town in the mid- to late-2000s are routinely selling for less than they paid’

    Ah, yes the mansion bubble of the late 2000’s. It actually ran out to around 2014-15, alongside the “safe deposit box in the sky” bubble. I guess the PR campaign precludes mention of a bubble though.

  4. Speaking of overpriced crap

    https://www.zillow.com/homes/for_sale/51667458_zpid/33.483102,-117.718871,33.478269,-117.727916_rect/16_zm/1_rs/1_fr/

    Price history
    DATE EVENT PRICE
    9/10/2018 Listed for sale $15,995,000–
    6/7/2017 Listing removed $15,995,000–
    11/14/2016 Price change $15,995,000(-5.4%)
    3/8/2016 Listed for sale $16,900,000(-0.6%)
    12/10/2015 Listing removed $16,995,000–
    7/9/2015 Price change $16,995,000(-15%)
    4/30/2014 Listed for sale $19,995,000–
    9/10/2013 Listing removed $19,995,000–
    8/18/2012 Price change $19,995,000(+207.9%)
    1/20/2005 Sold $6,495,000(+116.5%)
    2/21/1999 Sold $3,000,000–

    1. Seems pretty sustainable to me! Are you insinuating that the seller isn’t entitled to gains of 200% or more… come on you just gotta roll it!0

        1. All good. Pretty used to it. When you go from leasing a new Mercedes to having it taken away then fighting the other realtors for squirrel dinners served over a paper platter of ramen, you adapt to the “just roll with it” lifestyle.

  6. When you get the property tax bill, this statement makes perfect sense..

    +++++

    “when Starwood CEO Barry Sternlicht, a former Greenwich resident, declared it to be the worst housing market in the country. ‘You can’t give away a house in Greenwich,’ he said.”

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  10. ‘A lot of sellers are taking hair cuts of $1 million or more just to move on.’

    Must be a very stylish haircut!

  11. FWIW: I have been hearing lots of break room talk about how the tax deductions (or lack thereof) have impacted my coworkers and their friends. One conversation I was engaged in, Mrs. FB and her husband had bought a home in 2017 for 1.2m and said she now has to add about $1500 more a month of estimated overhead than she did in prior year. Crater time is upon us! Yay trump, yay SALT

    2. No kidding, out here in my deep blue (idiocracy) state they were running new stories of people complaining about not getting that big tax refund they were depending on. Newsflash idiots, you already spent it!

      Same kinda people you see pushing on a door that clearly says “pull”.

      1. I suspect Trump will conclude that he miscalculated and overestimated the intelligence of the average American when he helped them get more money all year and then less refund later. He thought if the total dollars they kept was more, they would appreciate it and give him credit.

        1. miscalculated and overestimated the intelligence of the average American

          Or has the average American been conditioned to give the government an interest-free loan and to expect a refund?

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