The State of Real Estate 2013: The New Fairfield
The Real Estate Landscape Bends to the Times.
HOW the Luxury Segment Softened
WHat Makes a Website Buzzier
Who Needs Affordable Housing
WHERE Do You Go for Empty Nest Downsizing
For some, Fairfield is the stuff of dreams.The perfect place to start out, raise a family, transition to an empty nest or retire in a golden sunset (overlooking the harbor, preferably). Yet, the market can be tricky to navigate, especially when one is carrying the burden of huge financial decisions, ultimately. When to buy, sell, renovate, rebuild, re-fi…it’s step after step, each carefully considered. Here is a snapshot of the dynamics defining the top issues and opportunities as determined by market pros.
Fairfield real estate brokers may have been sipping champagne on New Year’s Eve not to ring out the old but to celebrate it. That’s because the single-family home market posted notable gains last year.
Indeed, from 2011 to 2012, sales volume climbed by 17 percent, from 525 to 612, according to local multiple listings service data.
True, sellers may have had to settle for less money than they expected, since prices were almost flat from the year before. But the fact that activity has generally been trending upward since the recession is being hailed as a positive sign.
Still, a caveat: The tippy-top of the market—those homes listed for several million dollars—continues to struggle, suggesting that even though Wall Street might be back, its execs may no longer be splurging on mega-sized homes.
“Styles have changed. A 10,000-square-foot home was a good image for parties during the boom. Now, they’re buying homes that are 5,000 square feet,” says Mike Daversa, president of Atlantic Residential Mortgage, adding that $1 million mortgages are now far more common than $2 million mortgages.
In Fairfield, the cutoff point seems to be $4 million, says Victoria Fingelly, a partner at the brokerage Nicholas H. Fingelly Real Estate. Below that point, the market in 2012 was humming; above it, there wasn’t much of a pulse, she explains.
To wit: In 2012, there was a single sale for more than $4 million in Fairfield, a five-bedroom 1927 Colonial in Southport, with harbor views, for $5.75 million. In contrast, in 2007, a banner year, eight houses sold above that price point, Fingelly says.
And that current backlog in that bracket is substantial. There are presently eleven unsold properties for more than $4 million in Fairfield, some of which have been on the market for more than a year.
Examples include a six-bedroom 1854 Italianate, also on Harbor Road in Southport, listed at $10.9 million, as well as a five-bedroom 1822 Colonial, located on six acres on Hulls Farm Road in Greenfield Hill, at $4.2 million.
“The Lehman Brothers collapse really put the brakes on everything,” Fingelly says. “But even when Wall Street appeared to bounce back, a lot of people still kept their belts tightened, because the salaries still weren’t there.”
Instead, the sweet spot here last year and perhaps going forward, was for homes priced between $200,000 and $500,000, brokers say. After all, “$500,000 buys a lot more than it used to,” Fingelly jokes.
Spinning a Web
In case you were thinking that lawn signs don’t matter so much anymore in the real estate hunt, you’re partially right.
Ninety-four percent of all home searches start online, according to 2011 statistics from the National Association of Realtors—and the percentage has probably ticked up a few points since then.
It’s no wonder then that 2012 saw increased investment by local Realtors in their websites, especially in regards to new video components, even as they embrace some social media tools more tentatively.
Currently, on the website for Michelle & Company, an affiliate of William Raveis Real Estate, a mouse-click on a listing takes visitors to a somewhat staid photo-filled PDF file. But next summer, after a substantial redesign, visitors will be able to click to view mini-movies about featured homes. Another new feature will allow views of certain rooms from different angles, says affiliate owner Michelle Genovesi, who has been selling homes in Fairfield since the mid-1980s.
However, don’t expect any real-time status updates about those listings. “I have been very cautious so far about Twitter,” Genovesi says.
For all the recent doubling-down on online marketing, though, there is a slight risk of overkill, says Julie Vanderblue, an agent with the Higgins Group. Specifically, brokers must be careful to not post pretty but misleading pictures of homes, which does a disservice to buyers and brokers. “You would rather surprise them with greatness,” she explains.
But there may be an incentive to emphasize quantity over quality. Posting twenty-five photos, as many of Higgins’s listings do, instead of a lesser number, insures that listings earn the highest-possible ranking within national aggregator sites like Trulia, Vanderblue says.
Internet video has also caught her fancy, but with a twist. Early in 2013, she began including it on her website not to “have a broker walk through a house for three minutes and say, ‘This is the kitchen,’ but to focus on the neighborhood and community,” she says.
Also, Vanderblue last year launched an “Exclusive Sneak Preview” page, which lists homes that have not yet been added to a multiple listing service, and thus are not searchable by the universe of brokers. In the past, “pocket listings” of this type have been criticized because they can allow a single agent to take an entire commission. Vanderblue explains that the feature is a type of opening for a property. “It’s great to generate feedback before bringing the listing to” a multiple listing service, she says.
Besides, she adds, it’s not the local brokers she’s protecting against but the aggregator sites, which shotgun-blast listings to every Tom, Dick and Harry, and thus complicate the house-hunting process for the buyer. In early January, that Sneak Preview page featured thirteen listings, including a five-bedroom, 1983 Colonial on Farmstead Hill Road at $1.675 million.
One way to make online photos more appealing is to hire a professional stager, who can outfit an empty home with furnishings. Birgit Anich, who just won Stager of the Year from the Real Estate Staging Association, says one Fairfield home sat unsold for two years before it was staged. It sold three weeks later. She says, “Staging has become more and more of a standard.”
So, online has its value, but offline techniques still matter. Lawn signs, especially those with instructions about how to receive a text message for more details, “have brought me buyers many times,” Vanderblue says.
When Housing is a Hurdle
A town with private harborside golf clubs and renovated pony barns on sprawling estates might seem like the last place where poverty is a problem. But hundreds of people struggle to afford to live in Fairfield, says Carol Martin, executive director of the Fairfield Housing Authority, which promotes affordable housing.
The Authority, which was formed in the 1950s to deal with the post–World War II housing crunch for veterans, currently owns two complexes, mostly for seniors—Trefoil Court with thirty units and Pine Tree Apartments with thirty-eight. Both have lengthy wait lists. The agency also oversees a Section 8 program, through which residents can pay their rent using federal vouchers at seventy-six approved apartments.
Affordable housing makes up 3 percent of the town’s housing stock, according to state figures, versus about the same in Westport, but below the 15 percent in Stamford. In a town still limping from the recession, 3 percent is not enough, says Martin, who argues that 10 percent, or more, is probably more realistic. In 2012 Martin got six calls a day from people needing a cheaper place to live, versus five a day in 2011. Section 8 is a federal program, but 75 percent of those now seeking affordable housing have Fairfield roots, says Martin, who grew up here. The group includes people who worked on Wall Street and lost their jobs in the crash, making payments on their home loans difficult, which led to foreclosure.
Defying national trends, the foreclosure problem seems to be getting worse. In 2012 there were 96 foreclosure filings in Fairfield, according to RealtyTrac, a research firm, as compared with 72 in 2011, or a 33 percent increase (see sidebar). Still, the numbers are down from 2008, when there were 141 filings, the data show. “We didn’t have enough affordable rental housing to begin with,” Martin says, but the recession and foreclosure mess “exacerbated a crisis.”
It was among the last boom’s most publicized trends: Homeowners faced with too much square footage to take care of after their children moved out decided to sell and move to a smaller place, usually in a neighborhood with a pedestrian-friendly vibe. But that empty-nester downsizing was dealt a blow by the housing collapse, brokers say, because those same oversized homes in the suburbs have become tough to sell, among other reasons.
What makes the situation so vexing is that the interest in scaling back is still there, says Pam Foarde, an agent with William Raveis Real Estate. One of her current listings, a 1759 clapboard Colonial on less than a quarter-acre, is located on the Old Post Road, which means it’s a short walk on a sidewalk from bustling downtown. Though the property, which is priced at $1.12 million, is unsold after three months, open houses have turned up several would-be downsizers, Foarde says. “I’m seeing quite a few people who are looking to downsize either now or in the next few years. Their kids are grown and have left the nest, so they don’t feel the need for a big house anymore,” she says.
In addition, Foarde, who’s been in Fairfield for fifteen years, has three clients seeking to unload their large, rural properties, including a widow with a daughter in college and another headed away soon. This spring, that client hopes to trade her 5,000-square-foot Greenfield Hill home for something smaller and closer to town, Foarde says.
To be fair, residents say that the downtown area has room for improvement, like another grocery store or reopening the Community Theatre. But, generally speaking, more homes are being marketed for their “Fairfield Center” location these days, brokers say, with once-overlooked James and Pratt Streets commanding impressive prices as of late.
Jay Tolisano, a banker with Atlantic Home Loans and a Fairfield resident, agrees that the downsizing trend has taken a time-out. “I wouldn’t say that there is a ton of it going on right now,” he says. Plus, many underemployed twenty-five- to thirty-year-olds are actually moving back in with their parents, obviating the need to downsize anyway, he adds.
Yet in words that should hearten any seller who wants to downsize, Tolisano describes how a couple he knew recently moved from New Haven County to Fairfield without selling their home there first. Instead, they rented it out, which was enough—along with their solid jobs—to qualify for a loan to buy a local three-bedroom farmhouse. “More and more people are becoming landlords,” he says, “while waiting for the market to turn around.”