By Candace Taylor
Speaking at an investment conference in 2016, Starwood Capital Group CEO Barry Sternlicht declared his erstwhile hometown of Greenwich, Conn., to be the worst housing market in the country.
"You can't give away a house in Greenwich," he told the crowd. His comments horrified real-estate agents and home sellers in the affluent enclave, which had struggled for years to unload a backlog of properties.
Four years later, the Greenwich market has seen a remarkable turnaround in the pandemic, surpassing other wealthy suburbs in the area.
In November, there were 127 contracts signed for Greenwich single-family homes -- more than triple the November 2019 figure, according to a Douglas Elliman market report. By contrast, Fairfield County as a whole rose 8% in the month, and Westchester County in New York jumped 29%.
"It's the best real-estate market we have had in 20 years," said Janet Milligan, an agent at Sotheby's International Realty.
While the pandemic has revived suburban luxury markets across the country, the contrast is especially stark in Greenwich.
After Mr. Sternlicht's comments, the town took the unusual step of hiring a public-relations firm to improve its image. Aiming to dispel perceptions that the town was snobbish, all-white and uberwealthy, the PR campaign instead portrayed Greenwich as diverse and sophisticated. The town has a population of about 63,000 at various income levels, said real-estate agent Robin Kencel, who served on the town economic-development committee that launched the initiative.
Still, the luxury market struggled.
Enter the pandemic.
Starting in March, agents said, wealthy Manhattanites flocked to Greenwich, looking for large homes, ideally with multiple home offices and a swimming pool. First, they rented, but as the pandemic dragged on they started buying houses and enrolling their children in the local schools.
Tristan Margot, 37, and his wife, Syndy Margot, 40, paid more than $1.1 million in September for a three-bedroom house in the Riverside area of Greenwich. They beat out several other bidders and went into contract within a week of seeing the house; they were represented by Jennifer Leahy of Douglas Elliman. "The market was so intense," said Ms. Margot.
The Margots, who have 4-year-old twins, had been living in Westchester but wanted to be closer to the water. They liked Greenwich's highly rated public schools and relatively low taxes, and the house's proximity to the train station.
The town's bucolic Back Country, where large homes tend to sit on 4 or more acres, has seen the most dramatic recovery. Sales there jumped 74.4% in the third quarter from the same period last year, sharply reducing inventory.
"In Back Country Greenwich, those big estates that were hard to sell because who needs a 12,000-square-foot, 10-bedroom house? Well, all of a sudden they became extremely desirable," said Greenwich real-estate agent Jill Miller of Houlihan Lawrence.
Greenwich, situated on about 48 square miles on Long Island Sound, is one of the wealthiest towns in the country. It has about nine private schools and numerous country clubs. Roughly 30 miles from Manhattan, it has long served as a bedroom community for high-powered commuters.
"In Greenwich, an $800,000 house is basically a teardown," said Ms. Miller.
In the early 1980s, Donald Trump and his then-wife, Ivana, bought a lavish Greenwich mansion on 6 waterfront acres for $4 million. By the early 2000s, a number of hedge funds had set up shop, with billionaires such as Steven Cohen and Ray Dalio among the town's residents.
As a result of its ties to the finance industry, its real-estate market notched massive price growth during the boom years. But it also was particularly hard hit during the 2008 economic crisis, which saw finance workers lose their jobs. Unlike New York City, Greenwich's high-end market never fully recovered, said real-estate appraiser Jonathan Miller.
Wealthy young families were increasingly choosing to stay in the city rather than move to the suburbs, he said. Many who made the move preferred to live closer to the restaurants and shopping in Greenwich's bustling downtown. Large estates in the Back Country area north of the Merritt Parkway fell out of favor, sitting on the market three years on average, said Ms. Milligan of Sotheby's.
"Now," she said, "they sell within a couple of weeks."
Ms. Milligan, for example, listed the French Normandy-style estate of fashion mogul Tommy Hilfiger in September for $47.5 million. It is now in contract, she said, after receiving three offers.
The 13,344-square-foot home has six bedrooms, six fireplaces, a screening room, and a wine cellar and tasting room. Outside, the hilltop estate includes formal gardens, fountains, a swimming pool, a tennis court and a guesthouse.
In addition to large estates, the town has other draws. One is relatively low property taxes -- among the lowest in Fairfield County, which in turn are lower than in Westchester County, said Ms. Kencel.
Taxes were a factor for Ms. Miller's client Salvatore Pepe, president of Pepe Auto Group, who paid $2.17 million in September for a six-bedroom Colonial with a swimming pool and views of Long Island Sound. After being outbid on several other properties, he paid about $25,000 over the asking price for the house.
Mr. Pepe, 66, who moved to the town after a divorce, said he pays about $17,000 a year in property taxes for his new home. He estimated that taxes on the same house in New York would cost him about $50,000.
Mr. Pepe, who previously lived in nearby Rye, N.Y., already was a frequent visitor to the restaurants, shops and nightlife in Greenwich's downtown, one of the larger centers in the area.
"There's a certain comfort level to seeing Hermès and Saks on the main street, and lots of restaurants," said Ms. Kencel. That is especially true for buyers from Manhattan, she added.
Danielle Clemenza Miller, 38, and her husband, Jonathon Miller, 40, were taking their time looking at homes before Covid. They had moved to Connecticut from California and were living in a rental while looking at Greenwich houses with real-estate agent Cora Lynch-O'Meara of Brown Harris Stevens. "We thought we all had the time in the world because it was such a buyer's market," said Ms. Miller, who owns the New York City-based home-staging company, Clementine Interiors.
Because they were looking for a Back Country home on 3 or 4 acres, there was plenty to choose from -- at first. "Pre-pandemic, it seemed as if we wanted what no one wanted," she said. When Covid-19 hit, "everything just completely 180'd."
Eventually, they opted to buy a fixer-upper to renovate and flip. They paid $975,000 for a split-level, which they plan to sell in the spring and buy their dream home after that. "We were so close to being able to move into our forever house," said Ms. Miller. "We felt like we had the rug pulled out from under us."
Write to Candace Taylor at Candace.Taylor@wsj.com
(END) Dow Jones Newswires
12-10-20 0914ET
