It's simply a matter of adjusting "aspirational prices", say Ogilvy and his peers.
The latest example is last month’s sale of Greenwich’s largest estate in the backcountry gated community of Conyers Farm. Originally listed in 2015 for $65 million, the price was reduced several times until it finally closed more than two years later for $21 million. The seller, billionaire Thomas Peterffy, had paid $45 million for it in 2004.
Those steep discounts don’t necessarily mean the properties lost value, according to Jonathan Miller, a real estate appraiser and consultant who provides Greenwich market analysis for Douglas Elliman.
“The pricing of a lot of these properties reflects a different time. It’s not reflecting the current market,” he said. “The discounts are very large because they’re discounts from prices that were never close to what the market conditions actually were.”
Between the housing bubble and changing trends in real estate, many Greenwich homeowners haven’t been pricing their homes according to how the real estate market currently works, said Miller, who calls the tendency “aspirational pricing.” With so many overpricing their homes, sellers’ expectations can become skewed.
Where I come from— Riverside — paying $45 million for a property and dumping an additional $20 million into renovations, then selling it for $21 million, total, adds up to a $44 million loss, minus transaction costs. That may not mean the property lost value in proper Greenwich real estate circles, but for those of us snickering on the fringe, it does suggest something close to that conclusion.