Selling higher and quicker constitutes eastern Connecticut's real estate market
It's still a seller's market in eastern Connecticut, and sellers don’t need to wait to list their homes.
“There’s a ton of buyers out there now,” Melissa Giangrasso, president of the Eastern Connecticut Association of Realtors, said. “Why wait for more competition?”
Low availability, shorter turnarounds and higher prices still largely constitute eastern Connecticut’s real estate market. The seller’s market is expected to continue for the foreseeable future, according to multiple local Realtors.
Between 2021 and 2022, single family homes were selling slightly above asking price, with a median increase of $26,000 to $316,000. There were 825 fewer homes available in 2022 at 4,196, and they sold two days quicker on average, according to the association’s data.
For January 2023, there were 222 single family home listings, 13% up, and they were on the market five days less with a median price of $300,000, up from $295,000 in Jan 2022, Giangrasso said.
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Strong economy and job prospects fueling the market
The local real estate market’s strength comes from job prospects, including Electric Boat, Giangrasso said.
“A lot of Realtors were posting they had 50 to 60 people lined up for open houses still, even in the higher price point,” she said. “There is not a lack of buyers out there, despite the interest rate increase.”
With this strength, the market has been robust and sellers are often getting multiple offers on homes, though buyers are getting less house for the dollar, said Greg Hanner, broker and owner of Garden Realty in Waterford.
The buyers are savvy now, and the homes that sit on the market longer are the overpriced ones, said Ryan Lajoie, broker and owner of Johnson & Associates in Thompson.
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“Some of those sellers are in a remorse situation, as maybe they weren’t ready to sell their house, and they might’ve missed the height of the market,” he said.
Another concern for sellers right now is that the low supply and high demand for houses may lead a would-be seller not to sell because they don’t have a new home lined up. This leads to the low supply continuing, said John Pizzi, a realtor for Randall Realtors/Compass in Norwich.
“The real estate market is strong, but it's only as strong as us having inventory and putting people into homes,” he said.
Code changes increasing building costs
Buying land to build ends up being a costlier proposition, as homeowners would need $400,000 to meet rising costs, Hanner said.
Recent state building code changes will slow down any construction that does happen, and increase costs for things inside the walls of the home, Lajoie said.
“If builders had permits in before that, that’s fine, but some of these upgrades are going to be close to $20,000,” he said.
Some people have tried to save money by waiving inspections. While uncommon, it’s also not recommended, because people may be paying for more work after the sale, Hanner said.
Buyer demographics vary
The home buyer right now can vary. Some are either people who work from home that need more space and others are growing families. However, “the excess demand” has come from younger adults that the pandemic has pushed them toward leaving home and leaving the cities, Hanner said.
People living in apartments would frequently go out before the pandemic. During the pandemic, they had fewer ways to keep themselves entertained at home, while people with homes would garden or do other activities needing greater space, and this has stuck with people, Lajoie said.
“Primarily in (Windham County), it’s a lot of local buyers, but there’s a huge influx of people from Massachusetts and Rhode Island buyers that are working remotely, or are traveling to the area for semi-affordable price ranges,” he said.
Landlords adding to their portfolio; fixing up units and raising rents
Experienced landlords have also acquired more multi-family units in the area. They’re refurbishing them and putting those units back on the market for higher rents, with three-bedroom units going from $1,100 to $1,500 per month in Windham County, Lajoie said.
Looking ahead, the area should have a strong third and fourth quarter this year in real estate, as more homes will come on the market in the spring, Giangrasso said.
There seems to be no sign of the eastern Connecticut real estate market slowing down, which can be frustrating for buyers and the Realtors with limited inventory, Pizzi said.
“We’d like to sell more houses,” he said. “We have plenty of buyers.”
This article originally appeared on The Bulletin: Eastern CT real estate still a seller’s market with low inventory