Wide open space: Darien realtors see uptick in New Yorkers seeking homes
Darien is among the many towns in Connecticut seeing a surge of interest from New Yorkers seeking to buy or rent homes out of the city.
Real estate agents from Greenwich to Fairfield and north to the Danbury area are reporting buyers materializing in the past few weeks looking to escape New York City, paying asking prices on the spot for single-family homes.
While the activity is being concentrated in the upper-income tiers, the trend is expected to trickle down to the starter home segment as well, which had already seen momentum last year as the luxury market stagnated; and along the Connecticut coast line east of New Haven where the vacation home market was already making a comeback as low interest rates had wealthy city dwellers looking for weekend escapes.
April home sales were down between 5 percent and 7 percent in Fairfield County, according to respective estimates by William Pitt Sotheby’s and Berkshire Hathaway HomeServices New England Properties, with sales off 19 percent in Litchfield County and New Haven County as determined by Berkshire Hathaway. But the trends are expected to reverse with updated figures next month tracking May sales, with both firms expecting a strong summer market that could last into the traditionally slower autumn and winter seasons.
New York City resident Meghan O’Donnell, a single mother who works in finance, has been a city dweller since the mid-90s. She moved to London for six years and then returned to Manhattan.
Between the risk of COVID-19 and trying to work at home in a New York City apartment with her three-year-old daughter, Violet, she’s investing in a weekend/vacation home in New Milford. Her sister lives in Sherman, which also makes Connecticut appealing to her.
O’Donnell isn’t the only one in her building — two of her friends with families moved to Greenwich and another moved to Darien. Those, she said, bought year-round homes and permanently relocated.
“I don’t know when I’m returning to the office, and even when we do, I’m worried about another outbreak,” O’Donnell said.
“Working with a three year old in a New York apartment is hard. And she has friends in the building and she can hear them and can’t play with them,” she said.
O’Donnell lives on East 72nd Street, which is the same neighborhood as several hospitals, including New York Presbyterian, Memorial Sloan-Kettering, and the Hospital for Special Surgery.
Because of that proximity, many medical professionals live in her building.
“We’ve gotten two separate emails from our landlord saying there are confirmed COVID cases in our building,” O’Donnell said. Between that and quarantining, she said she, like many of her neighbors, is looking in a new direction for a home.
Darien had a large increase in single-family rentals in March and April, said Lynne Somerville and David Hawes, of Halstead Connecticut.
“There were 25 single family rental closings in March and April, a 127 percent increase compared to the same time frame in 2019 when there were 11. It was also the highest number of Darien houses rented in March and April in at least the past eight years, with the previous high total being 14 in 2015,” Somerville said.
Rentals have continued to be busy with nine single-family rental closings in the first 14 days of May, Somerville said.
“That’s more than we had in all of May 2018, when there were a total of 7 single-family house rental closings and almost as many as we had in all of May of 2019, when there were a total of 14 single-family house rentals,” she said.
“While it seemed low at the time, Darien had 18 active single family rentals available at the end of April,” Somerville said.
Of the 10 active rental listings on May 15, prices ranged from $3,250 to $19,000 (per month) with an average list price of $7,935 per month, she said.
According to Halstead, the average rental closing price of a Darien single-family home in March and April was $7,330 per month, up 23 percent from the same time period in 2019 when the average single-family house rental price was $5,964 per month. Of the nine rental closings in the first two weeks of May, the average closing price was $11,950 per month and six of the closings had a monthly rentals price of $10,000 or over.
Nearby towns have also seen large increases in rental closings in March and April, Somerville said. Greenwich had 109 houses rented in these two months, a 79 percent increase over the same time frame in 2019. Norwalk had 45 single family house rented in March and April, an increase of 61 percent from 2019. Westport had 54 single family rental closings in March and April, a 135 percent increase.
“In all of Fairfield County, in March and April, there were 451 single-family house rentals as compared to 313 in the same in 2019, a 44 percent increase,” Somerville said.
“We are barraged daily by requests for specific properties both in rental and in sales categories. The trend is real and by all measures will be sustained long term. The pandemic has changed the landscape as much as our lifestyles. This isn’t about looking through a different lens — we need a new camera. Fortunately we can offer solutions to those changing needs,” Hawes said.
CT Waterfront Properties
John Tibbets, of CT Waterfront Properties, said the market activity in Darien — for sales and rentals — has doubled during the period of March 1 to May 15, 2020 verses the same period a year earlier, and there can be no doubt that it is a direct result of the COVID-19 pandemic.
“In this climate, it’s not uncommon to see multiple bids on properties. And for sales, the resulting dip in mortgage rates has had a positive impact,” he said.
Tibbets added that most, but not all, of the activity involves “refugees” from New York, and the increase is split evenly between sales and rentals.
“Certainly some of the purchase market can be attributed to people living in the city planning to buy a home in the suburbs ‘some day,’ and the current situation has accelerated that plan,” he said.
He added that many renters want to get a feel for the market before making a purchase decision.
Tibbets said according to the Darien MLS (Multiple Listing Service) statistics, during the period of March 1, 2019 to May 15, 2019, there were 48 accepted offers and closings for single-family sales and 20 for rentals. During that same period this year, there have been 103 accepted offers and closings for single-family sales and 41 for rentals.
“Quite a dramatic increase,” he pointed out.
Median prices have also increased during the same periods, from $1,250,000 to $1,300,000 for sales, and from $4,400/month to $5,600/month for rentals, Tibbets said.
He added that he’s noticed two interesting phenomena about New York renters. He said the short term renters are looking for up to six months which would 1. take them through the summer, the most expensive rental time and 2. have their lease up at the start of winter, which most landlords see as a difficult time to rent.
“So, with a few exceptions, the short-term rentals aren’t working out,” he added.
Tibbets reiterated that nothing has changed in the Darien market other than COVID-19, so the significant increase in activity is directly attributable to that.
Connecticut Compass manager Amanda Bryan said that anecdotally, she’s gotten inquiries from every single New York City manager (and there are 24 of them) for both rentals and buyers, and a lot of New York City agents are reaching out to agents directly looking for rentals.
“As a result, finding rentals for clients is getting increasingly more difficult and many agents are polling the office to see if anyone has anything coming on,” Bryan said.
“Many of these rental inquiries are for summer rentals which are practically non-existent and subsequently getting huge premiums, but even with the increase in seasonal rentals we are also seeing an increase in longer term rentals,” Bryan said.
Bryan said statistically, for 12-month, unfurnished rentals as of Monday of this week, Darien closed rentals were about 31 percent higher year over year, so they are seeing increased interest in longer term rentals as well.
“We’ve gotten quite a lot of inquiries for rentals from New York City clients, particularly for short term rentals, as well as an uptick in real estate activity in general. The spring market seems to be picking up steam, despite coronavirus concerns,” Maggie Marchesi, of the Marchesi Group at Compass, said.
First Selectman Jayme Stevenson said “We welcome, as always, new residents to Darien, no matter where they are relocating from.”
“The spread of COVID-19 has been problematic in densely populated areas. The Town of Darien offers a welcomed alternative,” Stevenson said.
“Our small town character, the excitement of new housing and business developments, open spaces, parks, beaches, nature trails and excellent schools are very attractive for folks looking to make a lifestyle change. This has always been the case for Darien but concerns over the spread of the virus make our community even more appealing,” Stevenson said.
In terms of what impact an influx of families from New York could have on the schools, Superintendent Alan Addley said “as always, the District is closely monitoring changes in student enrollment as an outcome of new families relocating to town.”
“The May enrollment projections do not reflect any significant change. Current K-12 enrollment is 27 students under budget. The majority of the change is represented in lower kindergarten enrollment which always tends to be the most unpredictable and the most likely grade to increase over the summer,” he said.
“We will continue to monitor in the coming months,” Addley said.
Wide open spaces
O’Donnell said her building is now at 20 percent occupancy.
“If you have little kids, and trying to work, with no childcare, in an apartment all day, it’s hard,” she said.
O’Donnell said she looks forward to having a yard for her daughter to play in and she got a new swing set for her to use.
“She’s big enough that she can play outside safely with me watching through the window,” O’Donnell said.
O’Donnell is a renter in New York City and said she will likely keep her rental, but fears of another outbreak made her want a more permanent location outside the city.
She clearly isn’t alone.
“I was talking to the movers here this morning and they said they have been at our building three times this month,” O’Donnell said.
“My building is a lot of two bedrooms so it is a lot of families — especially a lot of young families,” she said.
“I think people who could leave, have left,” O’Donnell said