this connecticut region was the hottest real estate market in the U.S. last month
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By Alexander Soule | Published on July 11, 2024
As a national real estate website proclaimed the Hartford area the hottest market in the nation for home sales in June, buyers continue to have to reach deeper into their mortgage credit or savings to get the keys.
Greater Hartford led Realtor.com's monthly analysis for markets nationally, based on views for available listings and a few other metrics. New England and New York occupied 11 of the top 20 slots including metropolitan Springfield, Massachusetts, ranked sixth, and the regions of New Haven, Bridgeport, Stamford and Norwich.
Tuesday on Skonet Road in West Hartford, a ranch sold for $425,000, about $50,000 more than what its owners sought, with the owners represented by Berkshire Hathaway HomeServices New England Properties brokers John Lepore and Kevin Eagan.
"Greater Hartford is performing well, but we're still undervalued compared to Fairfield County and some of the major markets," Lepore said. "People are understanding that they can come in from major markets and raise their family or just live in a nice environment, for a fraction of the price."
Lepore said that buyers who are squeezed out by other bidders will consider lower-priced houses, widen their geography, or simply sit tight in hopes that market pricing will move into their range. But with many analysts expecting the Federal Reserve to cut interest rates by the end of the summer, that could bring more buyers into the market, in addition to more listings from owners finally ready to sell, who themselves might be hunting for a new home in Connecticut.
Last week, the average fixed interest rate on a 30-year mortgage rose slightly to 6.95 percent. The 30-year, fixed-rate mortgage average hit 7.79 percent last October, the highest level since 2000 when the average inched above 8 percent.
From 16,700 properties listed for sale in May 2019 as tracked by Realtor.com, there were about 3,800 on the market this past May, putting pressure on buyers to be ready with competitive offers.
"You really have to consider waiving your contingencies and just take the house — and sometimes that doesn't even matter," Lepore said. "You've got houses going hundreds of thousands over asking, and people are losing the house."
Of more than 3,230 Connecticut properties that sold in June, it took just a week from listing to contract for the median home in that group, Berkshire Hathaway reported in its second-quarter report on the statewide market. Over the first six months of 2024, Connecticut's median house sold for $390,000, nearly $40,000 above the equivalent home in the first half of last year that equates to an 11 percent increase.
Statewide, dating back to January, more than 130 houses sold for that amount through Wednesday as tracked by Zillow, from a two-bedroom at the start of the year on a tight lot in Norwalk's Cranbury neighborhood, to a raised ranch in Thompson on more than five acres of land.
A newly constructed home on Dairy Road in Greenwich was the top sale in Connecticut for the first half of 2024, at $16.25 million selling for $100,000 more than an Indian Field Road home in Greenwich. Tennis star Ivan Lendl's estate spanning Cornwall and Goshen sold in January for $12 million, and remains the largest mansion and property sold in Connecticut this year with 18,000 square feet of total space and nearly 450 acres of land in the Litchfield County hills.
Connecticut houses are selling this year for 3.1 percent above owners' final asking prices, according to Berkshire Hathaway. In Zillow's most recent assessment of price ratios in nearly 625 metropolitan areas nationally, the Hartford area ranked fourth nationally in April, with sellers getting 4.7 percent above asking prices.
That trailed only metropolitan Rochester, New York; San Jose, California; and the Lake Michigan city of Sheboygan, Wisconsin. Greater New Haven ranked in the top dozen nationally for sale premiums above asking prices, and the Bridgeport-Stamford corridor in the top 20.
Despite prices remaining inflated in many cities and towns, a number have nevertheless seen sales accelerate in 2024. Of cities and towns where at least 25 properties sold in the second quarter, Putnam led the state in sales momentum with transactions nearly doubling from a year earlier, according to town-by-town preliminary totals published by Berkshire Hathaway.
In Avon, Middlebury, Winchester, Windham and Woodbridge, transactions were up by more than half from the second quarter of 2023; and transactions were up by more than a third in Cheshire, Clinton, Colchester, Cromwell, Lebanon and North Branford.
But in more cases, higher interest rates and prices — coupled with near-historic lows in new listings — have resulted in lower sales on the year. While Stamford remains well out front as Connecticut's most active real estate market with 485 sales in the first half, that was down 10 percent from a year earlier. And second-quarter sales were down nearly a third, despite listings accelerating into the spring market.
The CEO of William Pitt Sotheby's International Realty sees the 2024 market hinging on interest rates, setting up the possibility for an active fall market.
"Once the mortgage rates come down, I really believe it's going to start freeing up more inventory," said Paul Breunich, CEO of William Pitt Sotheby's International Realty which has its main office in Stamford. "What's interesting is that the dollar volume is up — more so than the units are down — and that's just due to the price mix of what's being sold, which is the middle-to-upper end which doesn't rely totally on a mortgage."