Column: The Big Greenwich Rental Market
By Mark Pruner
There is a real estate market in Greenwich that practically no one talks about and that has more transactions than we have single-family home sales. Last year we sold about 640 single-family homes, but we had 809 rentals that were done through the Greenwich. MLS. So far, this year we have had 456 rentals, but during the recession years people rented instead of buying. In 2009, we had 370 sales and 959 rentals. Now there are a lot more rentals than appear on Greenwich MLS. Under $2000 most of the rentals are done either in the classifieds in the newspaper or on Craigslist.
Under $2000 we have between 100 and 150 rentals per year on the GMLS. At this price range, the units include everything from one room garage and basement apartments to smaller condos throughout town.
The heart of our market however is between $2,000 and $4000. Last year we had 327 rentals out of the 809 Rentals listed on the Greenwich. MLS. This number has gone as high as 375 rentals in 2009. In this price range you’re mainly looking at condos and apartments, though you do occasionally find some smaller houses for rent.
We still have a good number rentals up to about $6000. Above that price we mainly have single-family homes and the number of listings drops significantly. Last year over $18,000 we only had 20 rentals. (They were however really nice rentals.) At the high-end these numbers should also be taken with a grain of salt since some of them represent summer rentals on Long Island Sound at a much higher monthly rate.
So, who rents their property in Greenwich Connecticut. A surprising number of properties are rented by local Greenwich. entrepreneurs and real estate investors. The listing at 2 Bote Court was bought by a family that lived there for over a decade and then decided to hold it for both sale and for rent. (This is also common as people will take the sales price if they can get their price otherwise they are happy to continue renting the property and generating income.) The house was updated with a new kitchen, master bath and a Nest thermostat system throughout the house.
Real estate rental property not only generates income but also depreciation which you can offset against some of the property’s income. On the downside, you may well have to recapture this depreciation deduction when you sell. In addition, many units were held for appreciation and asset allocation.
So who rents these places? We have young couples who can buy a bigger house, by renting out part of it for income to pay for their mortgage payments. We have seniors who like that someone else is on the property with them. We also have people who get transferred overseas and want to rent out the property because they’d like to come back to Greenwich. You also see the parents of college kids rent out their kids’ bedrooms.
In Greenwich people are always allowed to have tenants in their house unless restricted by a condominium association. This is leading to a surprisingly robust Airbnb market in Greenwich with over 300 listings. So far, the short-term tenants have not proved to be a problem with a few complaints to the town.
Two rental provisions that are often forgotten are the senior accessory apartment and the affordable accessory apartment. The senior accessory apartment allows you to put in a second kitchen, which is otherwise prohibited in most residential property, provided you the tenant or the landlord is over 62 years old.
The affordable accessory apartment does not have an age limit but does have an income limit on either the landlord or the tenant. I helped write this regulation and it would be a great way to help meet the state mandate for accessory housing. Were we to meet that mandate, developers couldn’t come in with affordable proposals to put in higher density housing.
We have a very robust rental market with listings coming and going quickly. If you can’t find what you want just wait a bit.
Mark Pruner was the #1 Connecticut agent for Douglas Elliman in 2015; firstname.lastname@example.org, 203-969-7900.