Spring marks new beginnings—including the annual run-up to the most active time for the real estate market. Typically, that is. The last couple of years had us all hunkered down, watching and waiting for signs of growth. This year we sent out writer C.J. Hughes to explore the local residential landscape, to gather facts and figures, and to check in with industry pros for their opinions. We also asked writer Jenifer Jonson to trace the welcome revitalization in downtown Darien.
Up, But with Qualifications
by c. j. hughes
A federal tax credit. Price cuts by sellers. A sense among buyers that the bottom of the market was past. These factors were instrumental in pulling up the area’s housing market in 2010, as it slowly but surely rebounds from the Great Recession.
The real estate industry may not be out of the woods just yet; values have a way to go before they hit the lofty highs of 2005 and 2006, mortgage and real estate brokers say, and price jumps of 10 percent a year will probably not return again soon. Plus, “I talk to a lot of Realtors who say they are not busy, and have not been for some time,” says Michael Daversa, president and founder of Atlantic Residential Mortgage, a longtime Fairfield County lender. But, he admits, 2010 “was a pretty good year for housing.”
Going forward, it’s not clear if that momentum will continue. The tax credit, which was especially useful for first-time buyers, expired last summer, and the uncertain job market may make some buyers think twice before taking on a bigger and pricier house. But as the new year dawned, brokers were reporting an increase in calls from sellers and buyers alike who, although they may not be whipping out their checkbooks yet, seem to be jumping into apartment searches, at least, with renewed vigor.
Here is the state of real estate, town by town:
Of all the enclaves covered by this magazine, New Canaan’s activity seems strongest. In 2010, 207 homes sold, up from 153 in 2009, for a 35 percent increase, with average prices inching up too, to $1.73 million from $1.67 million, according to data from the Darien Multiple Listing Service, which was used for the sake of an apples-to-apples comparison with other areas.
“Sellers finally got the message,” says Hugh Halsell, president of Brotherhood and Higley Real Estate. “The only way they were going to sell their properties was to adjust their price thinking.” But a cold splash of water hit buyers too, who can no longer expect to borrow 90 percent of the cost of a home; they can borrow up to 75 percent, says Halsell, who is also on the board of directors at The Bank of New Canaan.
Another rosy sign: In New Canaan, spec homes seem resurgent. These days, few $6 million homes will go up without having a buyer first, Halsell says, but with land costs down, there’s a growing temptation to build.
On the other hand, New Canaan condo values haven’t fared as well, with the average price dropping 9 percent in 2010 from 2009. Part of the problem is that mortgages are tough to come by if half or more of the units are rented out; though at New Canaan’s largest complex, Oenoke, on Heritage Hill Road, non-owner-occupied units account for about 35 percent of the units, so financing is usually attainable, Halsell explains.
Looking ahead, he likes what he sees, particularly because of the tax deal struck last winter between the White House and Congress so “taxes don’t go through the roof.”
It’s hard to find anything in Darien for less than $500,000. Indeed, in mid-January, of the 109 single-family homes on the market, the average listing price was $1.6 million, with the most affordable a 1950s two-bedroom in the Noroton Heights neighborhood.
But buyers keep coming. In fact, the number of sales was up 28 percent from 2009 to 2010, to 233 homes from 182, though brokers point out that gains are relative since 2009 was a bit of an annus horribilis.
On the other hand, average selling prices posted a hefty increase, to $1.69 million from $1.44 million—a 17 percent swing—if sales data from the town’s Multiple Listing Service are accurate. Big-ticket sales may have buoyed the averages, like a five-bedroom home in Tokeneke that traded for $6.35 million in November, and a six-bedroom 1926 Colonial on Scott’s Cove that went for $6.3 million in December, though it might be worth noting that both had price reductions. Still, Darien saw 11 sales for more than $4 million in 2010 versus 6 in 2009, data shows.
Historically, Darien’s downtown may not have been as lively as, say, New Canaan’s, which may have hurt its standing. Yet newish bistros like Ten Twenty Post and reinvented restaurants like The Goose are piquing the interest of people relocating for corporate jobs, says Realtor Eileen Hanford, a Halstead agent who has sold in town for three decades. “The town looked a little dated before,” Hanford admits, “but when I’m giving people tours now, they love it.”
Like its neighbors, this sixth taxing district of Norwalk, with its quarter-acre lots and Victorian-era homes, saw notable improvements on paper last year, with a 13 percent increase in Rowayton single-families sold, according to the Darien MLS. There also was a striking 55 percent climb in average prices, to $1.66 million from $1.07 million.
Yet Roy Thompson, a Realtor with Prudential Connecticut Realty who has lived in Rowayton for forty years, cautions against reading too much into the seemingly good news because a few jumbo sales may have tipped the scales. Four houses closed for more than $3 million in 2010, including a 6,400-square-footer on Crescent Beach Road that went for $4.4 million in October, though it had been on the market for 245 days and started out at $5.2 million. Plus, there were eight sales between $2 million and $3 million, which is a lot, he explains. “When you have several high-end houses sell, it’s going to make the averages look like we’ve done well,” Thompson says, though, “I think we are doing better.”
Also a factor for the bounce: Young, first-time buyers taking advantage of the federal tax credit, which helped them nab Rowayton’s cheaper homes, he says. Now that the credit is gone, it’s unclear if those buyers will still come around.
There’s also reluctance to pull the trigger. Rentals are up, especially of spec houses, Thompson says. And buyers return multiple times to one address without ever making up their minds, says Realtor Christine Thompson, who is also Roy’s wife. “Somebody came back twenty times to one listing and then bought another house,” whereas during the boom they might see it once, she says. “There’s a lot of hesitancy here still.”
Waking Up Darien
by jenifer jonson
photographs by gus cantavero and kiki koroshetz
Lessons in invigorating a quaint downtown
Sitting in the artisan coffee bar Espresso Neat, on Grove Street in Darien, is a bit of a full-circle experience for longtime town resident Penny Glassmeyer.
Nearly twenty years ago, she began acquiring the four properties that form the core of the development of the brickwalk Grove Street Plaza. “I wanted to open a coffee shop here,” she says. “The idea at the time was just to restore two of the houses and put a coffee shop in the ground floor of one. Of course it didn’t work out that way, but it’s kind of ironic that we’re sitting here all these years later in a coffee shop that exceeds my expectations of what a good coffee shop should be.”
Those first few years were a long road. Penny bought the first property at the behest of Raymond D. Nurme, then-director of Darien planning and zoning, who had an inkling that the Grove Street area would be vital to the future success of downtown. Up to the point, Glassmeyer had been working on residential properties, but she so respected Nurme that she started acquiring the neglected properties. “I worked for years with Ray Nurme and my architect,” says Glassmeyer. “Then Nurme retired in 1999 as I was about to get my P&Z approvals. At that point, they said I was building a monument to Ray Nurme and denied me. Then my architect passed away. So I started working on a new building.” That new plan didn’t make it through, but she wasn’t done with Grove Street.
Eventually, in 2002, Penny moved forward with her plans to develop the property. Concurrently, Tom Golden and Dwight Collins, both town residents, began their redevelopment of the Darien Playhouse, which sits catty-corner to Grove Street. “Grove Street and the theater helped to stimulate the idea,” says Glassmeyer. “People started to see what could be done in downtown Darien.”
In 2003 Evonne Klein was elected Darien’s first selectman. During her first month in office, she received a mailing that mentioned the Connecticut Main Street Center program, which was helping downtown areas become more productive. This nonprofit was sponsored by Connecticut Light & Power and the Connecticut Department of Economic and Community Development.
“I remember thinking that we had good bones and that Tom Golden and Penny Glassmeyer had started something, but we definitely needed help,” says Klein. “Penny had a vision and she understood how important mixed-use development was to the success of downtown, but there was a lack of direction at the time. There was little guidance available for how we could attract and improve other businesses in the downtown. I knew this was a great opportunity to improve our community.”
Klein had support but also faced resistance from those who didn’t share the idea of a new downtown. “Some critics liked Darien the way it was,” she says. “[Some] thought it couldn’t be done and that we wouldn’t be accepted into the program, so they weren’t keen on helping out.”
Undeterred, Klein put together the Downtown Darien Committee to complete the program’s lengthy application process; one of the people she turned to for help was Darien-bred David Genovese, a childhood friend of one of Glassmeyer’s sons. Genovese had left a job in finance and moved back to Darien and was busy buying and renovating local properties. It took a year to finish the application, but Darien was eventually accepted into the program in June 2005. The town then had to establish the Darien Revitalization Initiative, a nonprofit, as part of the Main Street program, which required a non-profit to run it; CMSC provided only guidance, not funding. And so began the work of raising capital. Genovese stepped up, offering to cohost, with local business owner Tom Geary, the first fundraiser.
The brickwalk plaza is just one of the more recent, pedestrian-friendly renovations in town.
THE PEOPLE SPEAK
“When we held that first fundraiser and 400 people showed up and wrote checks, the [town] government realized that there was real support for the program,” says Genovese. “That was a statement by the people. When developers put forth ideas to P&Z, it is one-off decision making; it’s not looking at the whole picture. The value of the Main Street Center program was that they were like management consultants to the downtown; they came to town with experts who could tell us what we were doing right and wrong, and if we wanted a more vibrant downtown, here are five things that could stimulate that.”
Jessica Curtis is head of the Retail Services Group at CB Richard Ellis, a real estate services firm in New York City, handling properties in Connecticut; she provides retail and restaurant leasing services and consulting (including Black Goose Grill and Sails). If anyone were to express concern that Glassmeyer and Genovese have had too much control over what is happening in Darien, she says, “David and Penny have committed to bringing in the right tenants for the town. They are unusual landlords in that they are more interested in the big picture than the highest dollar amount. Their tenants are mostly local, unique stores that make Darien quite different from the surrounding towns that have many national retailers lining their streets.”
Genovese explains, “I have a different sense of responsibility. I live in this town—if I brought in a bad tenant, I’d hear about it. I also believe in helping out other developers. I helped Penny get Go Figure; I’d been working with them elsewhere and thought they would actually fit better here, with Neat. Penny and I work together, and we like to help the other landlords as well.”
What does the future hold for our towns? With the Main Street Center project over, who is now steering the ship—and to where?
“I think New Canaan is the dream,” Glassmeyer concludes. “We do have some plans for the future to expand the footprint of downtown to create other areas, create more of a village like New Canaan.”
New Canaan’s tried-and-true local retail shops, such as The Whitney Shop, Pennyweights, Togs, and Candy Nichols, are staying put alongside national chains like J.Crew and Ralph Lauren; and new stores, like The Cosmetic Boutique and Mason, are opening their doors here. Over in Rowayton, on the other hand, there is still retail space available, despite the town’s obvious appeal and attractive developments, such as the Rowayton Market and two popular restaurants. But even the cosmetic changes made this past summer to a swath of buildings downtown do not speak to a clear development plan.
Genovese agrees with Penny about Darien’s future, saying, “We need to increase the depth of town. The new building I’ve built on Old Kings Highway has some flexibility to that end. It was built as an office building but could easily be converted to retail and apartments if the town spreads out.”
Evonne Klein was pleased at a meeting of The League of Women Voters of New Canaan when the question of how New Canaan could learn from Darien’s success was raised. “My answer is, start with people,” says Klein. “You need the initiative of property owners and developers and the support of the community.”