While luxury buyers chase turnkey properties in Greenwich’s competitive market, they’re overlooking significant opportunities in land development, according to Danielle Claroni, Senior Global Real Estate Advisor at Sotheby’s International Realty.
“There are parcels available, and some of them are in really fantastic neighborhoods,” Claroni says. “But people don’t want to wait the two years it might take to do a house.” This impatience, she argues, is causing buyers to miss out on potentially better long-term investments.
The Waiting Game
Claroni points to specific examples from her client base to illustrate the opportunity cost of avoiding land purchases. “I’ve had some clients that are now looking to build that have been on the fence, because I haven’t found anything for two or three years,” she says. “I was like, ‘You could have bought that piece of land that I told you about and built a house by now.’”
This reluctance to consider land purchases stems partly from misconceptions about construction timelines and costs, according to Claroni. Many buyers’ expectations have been shaped by reality TV shows that present unrealistic timelines for home construction and renovation.
Value Creation Opportunity
“I think that I wish I could educate some of them on how much more value you can add to a property if you just fixed it up yourself,” Claroni says. However, she notes that many buyers, particularly younger ones, have unrealistic expectations about construction costs and timelines.
“They’ve been watching all these reality TV shows, and they’re like, ‘Oh, I can do a new kitchen for $10,000,’” she says. “You can’t get a stove for $10,000.” This disconnect between expectation and reality often drives buyers toward finished properties, even at premium prices.
Market Evolution
Despite these challenges, Claroni maintains that land represents one of the best values in the current market. “If you buy a nice piece of land in a good neighborhood, and you put up a new house, I think you’re definitely adding value, and you’re getting exactly what you want,” she says.
The opportunity extends beyond just new construction. Claroni suggests that “fixer-uppers” also represent good value in the current market, particularly for buyers willing to take a longer-term view of their investment.
