The Middletown Press (Middletown, CT)
State real estate listings up, offering wider stock for spring market
New home listings jumped 8 percent in April in Connecticut, a development real estate experts have been looking for as home buyers search out more options than the limited number of houses on the market that has driven up prices, squeezing some out of making a move.
Over the first four months of 2024, the median sale price for Connecticut real estate was $373,000, as reported by Berkshire Hathaway HomeServices New England Properties based in Wallingford. That was $43,000 more than the median sale price at the start of 2023 — a 13 percent increase.
Real estate experts say the best cure for higher prices is more houses on the market, including those in lower price ranges that are affordable to buyers on tight budgets for mortgages.
The Federal Reserve’s timing for any cuts in interest rates is still an unknown, with borrowers having to pay far more today on interest for a 30-year mortgage than many home owners who secured loans prior to the COVID-19 pandemic. Rates edged downward slightly last week for the first time since March, according to Freddie Mac, but remain above 7 percent nationally on average.
Hartford and New Haven counties saw Connecticut’s biggest increase of April housing stock listings, up 11 percent from a year ago according to Berkshire Hathaway, with Fairfield County seeing a 9 percent lift. Only Middlesex County saw a drop.
“The markets were turning around in the first quarter — I thought this was going to happen sooner than it did, but it’s happening now. Even though interest rates are still high, there’s a lot of pent-up demand out there from sellers wanting to sell, and the listings are coming on. And the demand is still very high on the buy side.”
Paul Breunich, CEO of William Pitt Sotheby’s International Realty
“The markets were turning around in the first quarter — I thought this was going to happen sooner than it did, but it’s happening now,” said Paul Breunich, CEO of William Pitt Sotheby’s International Realty based in Stamford. “Even though interest rates are still high, there’s a lot of pent-up demand out there from sellers wanting to sell, and the listings are coming on. And the demand is still very high on the buy side.”
That has yet to translate into any broad-based momentum in completed sales transactions, however. Through April, about 8,860 houses and condos sold in Connecticut, as recorded by Berkshire Hathaway, nearly 675 fewer than a year earlier for a 7 percent drop. Sales were down in April as well, but by just a 1 percent margin.
Sales were up slightly in Tolland and Windham counties in the first four months of the year, and flat in Middlesex County.
But the increase in purchase options could turn those numbers around. In Stamford which often leads Connecticut in real estate transactions, new listings were up 11 percent from April 2023, pulling the city’s new listings for 2024 nearly on par with the properties hitting the market in early 2023.
By varying margins, a similar split trend played out in other major real estate markets like Greenwich, Norwalk, Stratford, Waterbury and West Hartford.
In Fairfield, Hamden and Bristol, new listings are above 2023 levels for the first four months of this year. Bridgeport and Meriden have seen new listings drop for those windows on a year-over-year basis.
Some wonder if the statewide listings gain is just a blip on the radar, or a signal of what is on the horizon for the remainder of the spring market and into the summer months. Listings have been hitting the Connecticut market in fits and starts this year, with April the first month where a statewide swell in listing activity became apparent.
Lumping in the three prior months dating back to January, there were 100 fewer listings in Connecticut compared to January through April in 2023, when listings were already near historic lows. The CEO of Berkshire Hathaway HomeServices New England Properties expressed caution in reading too much into what she termed “incidental and incremental improvements” in any one month, in commentary last month accompanying her firm’s first-quarter report.
“Pending contracts are starting to rise, pointing to predictions of a steadily growing market,” said Candace Adams, CEO of Berkshire Hathaway HomeServices New England Properties. “Buyers, who have had very limited choices and shrinking affordability, will look again at purchasing.”
While some buyers continue to pay above final asking prices on average, there are plenty of instances in which sellers have
backed down from amounts they sought at the outset in putting their homes up for sale.
Norwalk — the No. 2 market in Connecticut over the first four months of 2024 — offers one example of how some house hunters have gone into the process with an auction mentality, while others have been content to wait until the price falls within their target value range and budget. On Driftwood Lane in Norwalk just north of the Merritt Parkway, a seller got $51,000 above asking price in a $680,000 April sale that was at the city’s median price for the month. A day later on Scribner Avenue on the city’s west side, another seller got $82,000 more than their asking price for that same $680,000 median figure.
On the flip side in March, the owner of a William Street home in Norwalk took $45,000 less than the $725,000 they wanted to arrive at a $680,000 transaction. And another on Dewal Court whose owners originally went on the market last year for $750,000, dropped their price to $725,000 and then ended up taking a $680,000 offer.
Among Connecticut’s most active markets, West Hartford continues to see the biggest premium above asking prices, at 7 percent on average through the first four months of the year, and 11.4 percent averaged out across the 55 homes sold there in April. As one example, a
Greenhurst Road house that set the town’s median was put up for sale for $350,000 in April, with owners ultimately taking a $465,000 offer to move out with an extra $115,000 in hand.
In Greenwich, some properties have sold at steep discounts from their original asking prices after months or years on the market. But this year buyers are coming in nearly 3 percent above asking prices on average as calculated by Berkshire Hathaway, with many affluent earners able to skip the added cost of obtaining a mortgage at higher interest rates.
The CEO of New York Citybased Compass told investment analysts on Wednesday that he is projecting more new listings coming on the market nationally this spring than at any point in the previous three years, speaking on a conference call.
“The percentage of all-cash home buyers is at the highest level in over two years, with the stock market nearing all-time high,” said Robert Reffkin, CEO of Compass, which has real estate brokerage offices in Greenwich and a dozen other Connecticut cities and towns. “Assuming 2024 is just modestly better than 2023, this will end up being a three-year housing downturn, forcing many people to live and remain in homes that they don’t want to be in. We believe when rates come down it will create a massive surge in transactions.”