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Miller Samuel President & CEO Jonathan Miller joins Yahoo Finance Live to discuss the hottest housing market of 2020.
AKIKO FUJITA: Welcome back to Yahoo Finance Live. The pandemic has accelerated the move away from major cities over the last year, boosting home prices for suburbs just outside of those hubs. Greenwich, Connecticut, has seen the biggest uptick. We're talking about median home prices jumping nearly 2%, nearly 20% for single-family homes, the highest level in a decade, according to a new report out from Douglas Elliman.
Let's bring in the author of that report, Jonathan Miller. He is the president and CEO of Miller Samuel. And Jonathan, let's start with that, because you said what's interesting about this move is that Greenwich, Connecticut, didn't necessarily see a big bump on the back of the financial crisis when we saw some of the exit happening. Walk me through the activity, the scale with which you have seen those prices accelerate.
JONATHAN MILLER: So I think the first thing that we've seen-- Greenwich was largely passed over. It's the home base for Wall Street, the securities industry. And they didn't have a post-Lehman moment like the city did. The city has seen a tremendous housing boom.
With the advent of COVID, we've seen renewed focus on the suburbs, and Greenwich has been a key beneficiary. One of the suburban market's characteristics that have benefited has been the luxury or high-end markets, because that part of the unemployment picture has seen less dramatic impact than lower-wage earners.
So now we're seeing contract activity, for example, in single-families in Greenwich essentially triple on a year-over-year basis. Tremendous amount of bidding wars and an extremely tight market.
ZACK GUZMAN: We've been talking about the luxury segment of the market still seeing those benefits. But also, talk to me about the seasonal aspect of home buying as well, because Greenwich is one of those in the Northeast you would expect to kind of taper off in the winter months. But when we talk to people, it doesn't sound like that's happening here in 2020.
JONATHAN MILLER: No, I think the one thing about 2020 is that, besides being a disruptor, it also, through the seasons up in the air-- we have seen in Greenwich-- most of the region surrounding New York City has seen an easing or cooling in activity since peaking in the summer, with the exception of-- Greenwich is one of the standouts. And yet, during this past decade, it has been very lackluster and very tepid. Now it's anything but that, with a tremendous amount of competition for limited inventory.
And this is literally-- to be saying this now versus the condition that existed a year ago, is unprecedented.
And what's also interesting is that Greenwich is benefiting from a phrase that I'm calling-- it's become a co-primary market. In other words, that wealthy-- the affluent in the city are looking at Greenwich as a second-home market as well, where they have a place in the city and a place in the suburbs. Greenwich is benefiting from that as well.
AKIKO FUJITA: Jonathan, you talked about that inventory. It's already down about 23%, at least according to your report. How do you see that tightening even further in the face of that demand, and what does that mean for prices?
JONATHAN MILLER: Well, I think it just keeps the pressure on. One of the things that has happened, just looking at contract activity-- new inventory coming on in the month of November. While it's up, it is being blown away by contract activity. Inventory for new listings physically coming on was outpace 4 to 1 by contract signing. So as a result, we have tremendous price pressure that continues.
ZACK GUZMAN: Yeah, I mean, we've been talking a lot about that flight to the suburbs. Hard to think of a more stereotypical suburb than Greenwich, Connecticut, out there here in the Northeast.
But appreciate that. Jonathan Miller, Miller Samuel, president and CEO. Thanks again for coming on to chat.
JONATHAN MILLER: You bet.