Big bids still surfacing for homes, but market leveling
Of so many breakneck sprints to close a Connecticut home purchase or sale in the past two years, one that stands out for Coldwell Banker agent Melodye Colucci was a recent instance in which a buyer took their time — to the extent of spending extra for multiple inspections to determine if anything was amiss with a house that had been on the market for a few weeks.
“My client was saying, ‘What’s wrong with this house?’” Colucci said. “That was their mentality, having gone through the craziness of the past year.”
Heading into the summer of 2022, buyers may finally be getting a reprieve in Connecticut and nationally after experiencing a block-shopping form of shell shock since the 2020 outbreak of the COVID-19 virus. That surprise expressed by Colucci is the result of two years worth of houses sold well above asking prices, many within days or only hours on the market and some without the new owners even stepping foot inside.
Studies and anecdotal evidence suggests many sellers are no longer looking to break the bank with their asking prices, but with some still motivated to sell before rising interest rates and any future recession take the air out of the real estate market.
In a study of just over 100 metropolitan markets studied nationally by Redfin, the greater Bridgeport, New Haven and Hartford regions had relatively small percentages of sellers cutting their asking prices in May compared to many locales in the Northeast and nationally.
In Bridgeport and other parts of Fairfield County, just 15 percent of homes listed for sale had a cut in price as calculated by Redfin. That compared to more than 22 percent of listed properties taking price cuts last month across the metropolitan New York City and Boston markets tracked by Redfin, and above 30 percent in multiple Florida markets.
Paul Breunich, CEO of William Pitt Sotheby’s International
Realty, based in Stamford, said that New York City residents continue to scour western Connecticut for relocation options.
“It’s still a sellers’ market — demand is exceeding supply and
that continues to put upward pressure at some level,” said Paul Breunich, CEO of William Pitt Sotheby’s International Realty based in Stamford. “Instead of having 20 people make an offer and 15 going to ‘highest and best’, you’ve got 16 people making offers and three or four are going to highest and best — which is still exceptional demand.”
There are still instances in which prices boggle experienced brokers. Colucci recently negotiated the sale of a client’s Fairfield house which got an offer $268,000 in excess of the $857,000 listing price — a 31 percent pop.
Colucci said the sellers were shopping Connecticut in a relocation from California and were willing to expedite things by waiving an inspection. But with interest rates rising and continued uncertainty for the economic outlook, Colucci said such purchases are becoming rarer.
“I think that was the last hurrah,” said Colucci who works out of the Stamford office of Coldwell Banker. “When something good comes on it will go into a bidding war, but we’re not seeing the frenzy that we had.”
On behalf of a client buying this week in Bethel, William Raveis Real Estate broker Matt Hyde negotiated a $20,000 reduction off the original $500,000 listing price. The property was part of a probate sale after the death of the prior owner, and the sellers agreed to a lesser price recognizing the extra cost of work the buyer felt was needed.
“At the time the offer was submitted and accepted, we were definitely still in the heat of the market,” Hyde said. “We’ve seen some stability with pricing where things aren’t continually, drastically increasing in value on a month to month basis — but I don’t think we’ve seen any settling in prices.”
In addition to interest rates, Gov. Ned Lamont introduced an additional wild card for the Connecticut market this month — up to $25,000 in assistance to help first-time home buyers cover closing costs on a purchase, or $50,000 in towns with higherpriced real estate. That could help some of those buyers who were priced out of the market get back on the open house trail, seemingly with the boom market finally leveling off.
“This great appreciation in housing prices is not a help to renters, and we’ve got to do everything we can to help renters and those first-time home buyers step up and be able to get the opportunity,” Lamont said Wednesday during a Hartford press conference.