More good news than bad in Q1 2023 for the Connecticut Real Estate market
As we speed towards the close of Q1 2023, let’s take a look and see where we are and where we might be going.
From January 1 to March 14 2022, the median sales price for single family homes in Fairfield County was $570,000. For this same time period this year, that median sales price remained precisely where it was 1 year ago: at $570,000.
In 2022 at this time the average rate for a 30-year fixed rate mortgage was 4.16%. As of today it is now 6.65%. That is an incredible 60% increase in interest rates but our local market in Fairfield County remains incredibly stable in the face of headwinds.
In fact, listings routinely still sell for more than asking in absurd bidding wars. Our team just had a client in Norwalk, CT who tried to buy a 2-bedroom home asking $309,000. We offered $362,000 and were still beaten out. Most likely a cash investor was chosen but the fact remains: bidding wars are routine for well-priced properties.
That being said, not all properties sell immediately in a bidding war. Properties that are asking too much will either receive offers less than asking or will eventually be forced to reduce their asking price after sitting on the market. If you are selling we have two pieces of advice: 1. Please consider using our team and 2. Be sure not to overprice your property! Listen to your realtor and make sure they know what is really happening in the market and where it is going.
While the Fed’s policies haven’t yet led to the price declines in our areas that home owners out West are currently seeing, the reality is that whereas 1,331 single family homes were sold this time last year, only 834 were sold during the same period this year. That represents a 37% decline in quantity of homes sold, but continuing high demand and historically anemic supply are keeping prices high in spite of high interest rates.
Results in Litchfield County weren’t quite as positive for home sellers, although there was good news for buyers.
From January 1 to March 14 2022, the median sales price for single family homes in Litchfield County was $340,000. For this same time period this year, that median sales price fell slightly to $311,000. This represents an 8.5% decline in median home sale prices.
That’s bad news for sellers. Good news for buyers. And a sign of deep resilience in the Connecticut real estate market when interest rates can rise 60% but prices only fall 8.5%.
Like it’s neighboring county to the south, Litchfield County saw a 25% decline in quantity of sales.
While Fairfield County held even and Litchfield County slipped slightly in median sales price, the CT Shoreline has been performing the best!
From January 1 to March 14 2022, the median sales price for single-family homes on the CT Shoreline was $305,000. For this same time period this year, that median sales price increased slightly to $315,000. This represents a 3.25% increase in median home sale prices.
We define the CT Shoreline as the counties to the east of Fairfield County stretching to the border of Rhode Island, including New Haven, Middlesex and New London counties. Similar to the rest of the state, the CT Shoreline saw a 23% decline in single-family home sales from 1,992 this time in 2022 to 1,532 this year.
While the economic news is a bit of a mixed bag – some news is good for buyers and some news is good for sellers – the incredible fact to keep in mind is that demand is so high across all Connecticut real estate markets that in the face of a 60% increase in interest rates our markets continue to either grow or only shrink a little bit.
Interest rates are undoubtedly starting to take their toll on our market but if by any chance they hold steady or even start to decline, the Connecticut real estate market is clearly primed to take off.
If you are in need of real estate help or just want to learn more about the market, please reach out below.