With its large, stately million-dollar homes and manicured lawns, Greenwich, Connecticut, has long been a serene enclave that veteran hedge fund managers and financial services executives call home. But after the pandemic hit, a new wave of wealthy New York City residents have flocked to the town seeking added space and a sense of suburban security.
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“What you have is a visceral fear that you won’t have someplace safe to go [during the pandemic],” said Mark Pruner, an agent with Berkshire Hathaway Home Services in Greenwich. “One of the things money gets you is an escape from fear.”
As a result, Greenwich – under an hour away from New York City – has seen an explosion in home sales.
The median home price in Greenwich was $2.125 million in the third quarter of this year, up 18% from last year, according to brokerage firm Douglas Elliman and appraiser Miller Samuel.
These skyrocketing prices haven’t deterred wealthy buyers. In October, as other suburbs cooled off, the number of signed contracts for single-family homes in Greenwich tripled from the same month a year earlier, according to Douglas Elliman. November saw fewer signed contracts than in October, but there were still more than triple the number in November 2019.
“We had more sales in the first two weeks of November than in all of November 2019,” said Pruner.
Many of the home sales are at the very high end. In November signed contracts of homes priced between $2 million and $4 million grew by 370% and contracts of homes between $5 million and $10 million were up by 250%, according to who Douglas Elliiman.
Even when a new real estate tax went into effect in July that imposed a 2.25% tax on the portion of residential property exceeding $2.5 million, buyers seemed unfazed. Instead of seeing an influx of high-end purchases ahead of that tax as typically happens when buyers rush to close before the new tax hits, the buyers kept coming.
“The high end just took off in the middle of June,” ,” said Pruner. “A fair number of homes closed before the conveyance tax kicked in, but then it kept going up.”
A strong demand for rentals, too
It’s not just home sales that have been taking off in Greenwich, people have been wanting to rent, too.
The spring brought people from the city who were willing to pay top dollar for a safe and secluded space, said Robin Kencel, a Compass real estate agent in Greenwich. But those who needed to get out of the city in a hurry wanted to test the waters by renting before committing to buying a home.
Between March and August, there were more than 60 homes in Greenwich that rented for more than $20,000 a month compared to less than 20 last year, said Kencel. There were 12 homes that rented for more than $40,000 a month, she said.
“The Holy Grail for the summer was a nice house on a fair amount of land, but it had to have a beautiful pool,” Pruner said.
Greenwich has never had the summer rental market of the Hamptons, he said. “It has beautiful houses that are owned by high net worth individuals, who would never consider renting,” he said. “But when you say [to homeowners], you can go to your home on Martha’s Vineyard or in Maine and come back with $150,000 in your pocket, there was interest.”
Now the renters who have had months to explore the area know better what they are looking for and they are buying.
After deciding to leave New York City in March, Samantha Carleton and Matthew Blischak could not find anything to rent in Greenwich. So they ended up renting in nearby Darien.
Now they are looking to buy in the Greenwich area once the right property comes along.
“We couldn’t be happier here,” said Blischak. Their living area is larger, the dog can run around. The home has a garage and driveway, allowing him to enjoy driving his Porsche on the country roads.
“The real question to me is, all these people bailing out of New York. Are they are going to be here a year or two? Or are they going to make this their residence?” said Blischak. “Will they say, ‘I’m happy here. Let’s stay here, and commute a couple days a week.’ I think that’s what is going to happen. I think the suburbs are going to come back strong.”
A renewed demand for suburban living
Areas like Greenwich with car-dependent, luxury suburban homes were largely passed over after the financial crisis, said Jonathan Miller, president of Miller Samuel.
“The focus was on walkability – buyers wanted to be able to buy strawberries at three in the morning,” he said. “Luxury suburbs, like Greenwich, were skipped over.”
But the pandemic has completely shifted those priorities. “We are seeing a reorganization of the market and of the town itself,” said Pruner. “You have people who want to sell and upgrade or leave Greenwich and the Northeast altogether, and then you have people coming who are tired of New York City, but want to be close to it.”
A property Pruner has listed for $7.25 million has had the kind of interest he anticipated from New York celebrities and some international buyers. But he has been surprised that the majority of people looking at the home have been families from New York with school-aged children.
“At that price, for most people, it is a once-in-a-lifetime buy,” he said. “It might be someone who had a hugely successful business venture or they made a killing in a market. Usually older. We traditionally haven’t seen families with young children buying this kind of high-end home.”