The Connecticut market in the second quarter of 2006 has seen a continuation of trends that began last year: modest price increases, longer periods on the market and a lower rate of sales.
Statewide, the median price for a single-family home rose 3 percent to $310,000 and the number of sales dropped 11 percent to 17,341 units from the second quarter of 2005 to the same period of 2006, according to a report from brokerage Prudential Connecticut Realty. The median condominium price went up 7 percent, while the number of sales dropped by 6 percent.
Fairfield County, in southwestern Connecticut, which contains Bridgeport, Stamford, Greenwich, Fairfield and Westport, kept pace with statewide results, with a 5 percent rise in the median price of a single-family home and a 16 percent year-over-year fall in sales volume. Homes in Fairfield County, the most expensive in Connecticut with a median price of $592,000, are staying on the market 5 percent longer than last year.
“The market in Fairfield County is slower than we’ve seen the past few years. There is definitely more inventory, and homes are sitting on the market for longer periods of time,” said Ken DelVecchio, a broker at RE/MAX Heritage in Westport. “But the national economy is doing well,” he said, “and mortgage rates are still at unbelievable levels. Once buyers realize this really is a great time to purchase, real estate activity will return, and 2007 will once again be a very active time for real estate.”
Other brokers across the state agree the market is not in the red, but simply cooling off from the past five years of record sales. Robert Fiorito, a broker at Coldwell Banker Premiere Realtors in Berlin who specializes in central Connecticut, said that, historically, sales prices have risen 3 to 4 percent per year, which is in keeping with the performance of 2006.
“This is a reflection of the real estate market getting back to normal,” Fiorito said. “Our trends in Connecticut are what you are seeing nationwide. Areas that overheated are very soft while more affordable areas are doing OK, just not on record pace. Also, people who got into risky loans with variable rates are feeling a squeeze now.”
Still, low but rising mortgage rates may also be making people hesitant to move. As a result, DelVecchio noted that home improvement and remodeling companies are still performing very well, since families are adding to or changing space in their homes rather than selling.