Greenwich home prices decline most in 3 decades

Bloomberg

The median home price in America’s hedge-fund capital dropped 7 percent to $1.95 million in 2008 from a year earlier. The number of single-family houses sold fell to 460 from 726 a year earlier, broker Prudential Connecticut Realty said.

"We are directly affected by the financial world," said John W.M. Cooke, the Prudential broker who tracks the data. "And that’s suffering. So that was the biggest factor in our house sales last year."

The declines came as Lehman Brothers Holdings Inc. filed for bankruptcy, Merrill Lynch & Co. was forced to sell itself, and Congress authorized a $700 billion bailout of the nation’s financial system.

Former Citigroup Inc. Chairman Sanford Weill is among the financiers with homes in Greenwich. The town lies about 48 kilometers northeast of Manhattan and relies on Wall Street as its primary economic driver.

New York City’s job losses may total 243,000 by March 31, the city’s Independent Budget Office said earlier this month.

Greenwich home sales haven’t had a bigger year-over-year decline in the 32 years for which Prudential has data on the market, Cooke said. The biggest decline in transactions prior to last year’s was in 1987, when sales dropped 25 percent from the year before, and in 1990, which also had a 25 percent decline.

Average drops
There hasn’t been a bigger year-over-year drop in the average Greenwich home price since at least 1977, and the next biggest decline was in 2001, when the average fell 4 percent. The median is the midpoint of all sales. The average is calculated by adding the total dollar of sales and dividing by the number of transactions.

The top end of the Greenwich market showed the biggest drop in transactions, Prudential said. Sales of houses priced at more than $5 million fell by more than half, with 53 trading hands, down from 113 in 2007.

Sales of Greenwich homes priced at less than $2 million dropped 31 percent, and sales of houses valued more than $2 million declined 42 percent, Prudential said.

Charles Prince, former chief executive officer of Citigroup, was among the sellers who had trouble attracting buyers in 2008.

Prince got 15 percent less than his original asking price when he sold his five-bedroom Greenwich home for $5.2 million in August. He first sought $6.15 million for the Tudor-style house, which was on the market for 186 days.

Sales rose in only one category: properties of $600,000 or less.