Home sales revive in Greenwich, Connecticut, favourite of bankers

For Mari Nuzum, who spent three years searching, it's the best time to buy a home in Greenwich, Connecticut. She and her husband, Richard, bought a six-bedroom Colonial revival in the back-country neighbourhood for US$3.85 million. A year ago it was listed for US$4.75 million.

"I had in my mind exactly what I wanted for our family," said Nuzum, who moved in July with her husband, president of investments at Mercer Global Investments, and their four children to be closer to school and within commuting distance of New York, about 64 kilometres to the south. "My husband said, 'Just wait, the prices will keep going down.'"

The sale of the almost 929 square metres property illustrates the shifting fortunes of real estate in Greenwich, home to some of the world's top bankers and money managers. Five years after the collapse of Lehman Brothers, which led to thousands of job cuts on Wall Street, smaller bonuses and a paralysed housing market, the town is experiencing a revival in home transactions as sellers reduce prices and buyers set their sights lower, forgoing the US$10 million-plus properties that helped define the boom years.

Median home prices in Greenwich, known as the hedge fund capital of the world, rose 3 per cent to US$1.64 million in the first eight months of this year and the number of sales jumped 17 per cent, according to brokerage Shore & Country Properties. That followed a 3 per cent price drop last year.

Homes between US$750,000 and US$5 million are driving the rebound. Of 514 sales in the first eight months of the year, just one cost more than US$10 million, according to Shore & Country. In 2007, there were 21 transactions of more than US$10 million.

"People are just being a lot more conservative with how they spend their money," Russell Pruner, owner of Shore & Country, said of Greenwich. "They want to bank more money in the long run so that if there is a further downturn in the financial sector, they will have money available to them instead of living bonus to bonus."