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What is your favorite restaurant and why? Can you post a photo?
Last year was marked by a perfect storm of rising costs in the Connecticut housing market. Houses sold in mere days, prices skyrocketed and inventory declined to historic lows. However, 2022 is quite different, thanks to rising mortgage rates which have risen the cost of homeownership across the country. Rising interest rates, intended to tame inflationary pressures, are making homeownership more expensive throughout the country.
Inventories are increasing, buyers have more options, and they no longer have to compete with multiple bids. At the start of 2022, statewide inventory sat at less than a two-month supply. According to the Connecticut Association of Realtors, the state has four months of supply. This indicates how long it would take to sell the current inventory of homes on the market. Normal is a supply of six months. And while Connecticut is not quite there yet, the state has recovered from last year's poor levels of housing supply.
Over the past two years, buyers and sellers have seen extraordinary activity in the Connecticut housing market. As we enter the second half of 2022, properties continue to sell as quickly as they enter the market, frequently for significantly more than the asking price, and inventory levels remain low. Rising interest rates and a small increase in inventories are bringing the market to a level of equilibrium not seen since 2017 due to the market's stability.
This strong demand has boosted the average list-to-sale price ratio in the state, which is still above 100%. This indicates that the majority of Connecticut properties continue to sell for much more than their asking price. Home prices in Connecticut's major metropolitan areas are not expected to fall in 2023. The increase in home prices is only slowing considerably as compared to last year For example, in New Haven, CT, home values are expected to rise 2.9% between July 2022 and July 2023.
Connecticut Real Estate Appreciation & Forecast
Connecticut is currently a seller's market, with homes selling quickly and for more than they are worth. According to Zillow, the typical home value (or ZHVI) in Connecticut is $361,501. Connecticut home values have gone up 12.4% over the past year and 36% over the past two years. Although this is the statewide trend, each city and town is unique, which is why it's best to consult with a local real estate agent to better understand trends in your area.
Investing in Connecticut real estate is a good idea, especially in Fairfield County as there is a high demand for housing. It is the most populous county. According to Neighborhoodscout, the Connecticut real estate APPRECIATION RATE in the previous 12 months (2021 Q1 – 2022 Q1) was among the lowest in the country as the median price went up by 16.05%. APPRECIATION RATE was 2.49% between 2021 Q4 and 2022 Q1. Prices have risen by 26.3% in the last two years and 160.71% since 2000.
MEDIAN HOME VALUE: $330,479
AVERAGE RENT: $1,842 per month
OWNERS = 64%
RENTERS = 36%
Here's Zillow's forecast for some of the metro areas in Connecticut. None of these MSAs of Connecticut is predicted to see a home price decline in 2023. Rising home values and listing prices, combined with limited inventory, indicate that Connecticut's housing market is tilted toward sellers. This trend will likely continue for the foreseeable future unless inventory grows faster than demand or rising interest rates ultimately dampens the demand to that extent.
Hartford, CT home values are forecasted to rise 0.7% between July 2022 to July 2023.
Stamford, CT home values are forecasted to rise 1.5% between July 2022 to July 2023.
New Haven, CT home values are forecasted to rise 2.9% between July 2022 to July 2023.
New London, CT home values are forecasted to rise 1.5% between July 2022 to July 2023.
Torrington, CT home values are forecasted to rise 1.9% between July 2022 to July 2023.
Will the Housing Market Crash in Connecticut?
There is undoubtedly a slowdown in the pace of home sales in the Connecticut housing market, but it is more of a return to normalcy. This is neither a crash nor a bubble; housing demand is still present. The slowdown is ideal for buyers who are weary of being outbid in a hot Connecticut real estate market or who are experiencing buyer fatigue.
All-Transactions FHFA House Price Index for Connecticut (Quarterly)
Q2 2022: 555.93
Q1 2022: 522.99
Q4 2021: 509.99
Q3 2021: 499.31
Q2 2021: 473.16
Factors That May Influence the Connecticut Housing Market Outlook
When there is a boom in the housing market, it is in part generated by an increase in job growth and a fall in the unemployment rate. The relationship between the economy and the housing market cannot be severed. The strength of the economy and the rate of job growth both have an impact on the purchasing power of prospective homeowners. Connecticut ranks among the top five wealthiest states in the country due to the number of residents who travel to well-paying jobs in New York City and the number of significant corporations with headquarters in the state.
Connecticut also has the fourth-highest percentage of college-educated residents (about 35.6%) and is home to Yale University, which U.S. News & World Reports rated third in the nation in 2015. According to Connecticut State Comptroller, the labor market remains strong. Nationally, there are nearly two job openings for every unemployed worker. Connecticut added 1,600 jobs in May and has now recovered 83% of the jobs lost during the pandemic, including 86% of private sector jobs.
Three sectors — construction, professional and business services, and trade, transportation, and utilities — have added jobs above pre-pandemic levels. Connecticut’s per capita income of $82,918 is the third-highest in the country and, today is increasing the state’s minimum wage to $14 per hour. The state has recovered 83% of the jobs lost during Covid-19 and 3 industry sectors have rescued over 100% of the jobs lost.
Home prices are directly affected by demand, which, according to real estate experts, isn't going away anytime soon. However, they are not rising as quickly as they once did, and Connecticut real estate agents predict that prices will level off or rise slightly this year. Some of this is most likely due to rising interest rates. From 2020 to 2021, the median price of a single-family home increased by nearly 13%, from $307,000 to $345,000.
It was $268,00 in 2019. According to the National Association of Realtors, moderate price appreciation has historically been accompanied by a six-month supply. Construction has slowed for much of the pandemic, owing to labor shortages and supply-chain issues that have made certain materials difficult to obtain. Connecticut's housing supply is still well short of a balanced real estate market.
* This article is from Norada Real Estate Investments
Milford: So my favorite restaurant is and its not just about the food which is lovely but it is mainly about LANCE, our favorite bartender! If you are going there for the food, make sure to get the CERVICHE and the LAMB EMPANADA, the sauce is magnificent!...