connecticut 2016 first 9 months housing report · in the first nine months of 2016, average list...

Connecticut 2016 First 9 Months Housing Report

Homeownership is Still Part of the American Dream

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And now may be the best time buy, while housing prices and interest rates remain low

By John Tarducci, MIRM, Senior Vice President, New Development Services Division, William Raveis Real Estate, Mortgage & Insurance

Homeownership is still part of the American dream, and people think now is a good time to buy. According to an Ipsos Public Affairs/Wells Fargo survey, 93 percent of respondents think that homeownership is an achievement to be proud of, while 86 percent agree that homeownership is a dream come true. In total, 58 percent of millennials are considering buying a new home in the next two years, while 38 percent of the general population is in the same category.

Among those respondents who do not currently own a home, 23 percent agree that the top reason is because it’s difficult to save for a down payment, while 20 percent aren’t sure they’re ready to settle-down in one location and 17 percent believe their current credit rating isn’t good enough. As we look forward to the close of 2016, these potential buyers, who will be entering the market in the next 24 months, should be highly considered by builders who are wondering where to place their investments.

Connecticut | 2016 First 9 Months Housing Report

Housing Permits Continue to Decline in 2016

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In the first nine months of 2016, as compared to the same period of 2015, the total number of housing permits dropped 13.3 percent, from 3,741 to 3,244. The most significant decline came with 5+ Unit permits, which fell from 2,141 in 2015 to 1,696 in 2016—an overall decline of 20.8 percent in the largest contributing segment to overall permit totals. Multi-family and single-family units weren’t immune to the decline, with permits falling in the 3-4 Unit segment from 69 to 36, a decline of 47.8 percent, and 1-Unit permits falling 3.1 percent from 1,469 to 1,424. There were increases in the first nine months of this year, with 2-Unit permits rising 41.9 percent.


State of ConnecticutHousing Permits Issued by CountyJanuary - September 2015 vs. 2016(104 Municipalities Reporting)

UNITS 2014 2015 2016 % DIFF.

1 Unit 1,786 1,469 1,424 -3.1%

2 Units 66 62 88 +41.9%

3-4 Units 80 69 36 -47.8%

5+ Units 1,719 2,141 1,696 -20.8%

TOTAL 3,651 3,741 3,244 -13.3%

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In the state of Connecticut, the first three quarters of 2016 saw an increase in home sales, with totals rising 9.2 percent, from 23,454 in 2015 to 25,621 in 2016. On a county-by-county level, all counties experienced increases, including: Windham County at 20.8 percent, New London at 14.9 percent, Hartford County at 12.5 percent, Litchfield County at 10.1 percent, New Haven County at 10 percent, Middlesex County at 9.6 percent, Tolland County at 7.8 percent and Fairfield County at 2.1 percent.

Average Sales Price for the state of Connecticut finished the first nine months of 2016 six percent below 2015 levels, decreasing from $400,347 to $376,420 and continuing the downward trend of home prices in the state. Most counties experienced a decrease in Average Sales Price, including: 7.8 percent in Fairfield County, 2.3 percent in New London County, 0.7 percent in Middlesex County, 0.7 percent in New Haven County and 0.4 percent in Litchfield County. However, Average Sales Price increased slightly elsewhere, including: 2.5 percent in Hartford County, 2.3 percent in Tolland County and 1.6 percent in Windham County.

In the first nine months of 2016, Average List Price increased 9.4 percent in, Months of Supply fell 13.7 percent and Price Per Square Foot decreased five percent over 2015 levels.

Single-Family Home Sales Rise as Average Sales Price Declines


First 9 Months 2016 vs. 2015

Unit Sales 9.2%

Avg. List Price 9.4%

Months of Supply 13.7%

NUMBER OF UNITS SOLD AVERAGE SALES PRICE

COUNTY 2015 2016 % DIFF. 2015 2016 % DIFF.

Fairfield 6,182 6,311 +2.1% $796,339 $734,064 -7.8%

Hartford 5,750 6,471 +12.5% $256,684 $263,104 +2.5%

Litchfield 1,472 1,621 +10.1% $295,403 $294,268 -0.4%

Middlesex 1,340 1,468 +9.6% $304,181 $302,096 -0.7%

New Haven 4,840 5,325 +10.0% $259,548 $257,793 -0.7%

New London 1,936 2,225 +14.9% $251,031 $245,342 -2.3%

Tolland 1,048 1,130 +7.8% $233,929 $239,304 +2.3%

Windham 886 1,070 +20.8% $180,459 $183,328 +1.6%

STATEWIDE 23,454 25,621 +9.2% $400,347 $376,420 -6.0%

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Single Family Home Sales

Single Family MarketplaceMonths of Supply First 9 Months 2015 vs. 2016

COUNTY 2015 2016 % DIFF.

Fairfield 8.9 8.9 +0.4%

Hartford 6.7 5.5 -17.9%

Litchfield 13.1 10.8 -17.4%

Middlesex 10.1 8.2 -18.6%

New Haven 8.6 7.1 -16.5%

New London 9.6 7.9 -17.7%

Tolland 8.9 7.2 -19.5%

Windham 8.6 6.0 -30.9%

TOTAL 8.7 7.5 -13.7%


Single Family MarketplaceHome Sales First 9 Months 2015 vs. 2016

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In the first nine months of 2016, condominium sales saw a four percent increase, rising from 5,978 to 6,216. Most counties saw an increase in Units Sold, including: Windham County at 19 percent, New London County at 12.5 percent, Litchfield County at 6.8 percent, Fairfield County at five percent, New Haven County at 3.8 percent, Middlesex County at 1.8 percent and Hartford County at 1.7 percent. The only county to not experience gains was Tolland County, where Unit Sales fell 5.2 percent.

Additionally, Average Sales Price of condominiums decreased slightly overall, falling 3.2 percent from $223,386 to $216,248. Declining prices were seen in New London County at 10.6 percent, in Middlesex County at 5.6 percent, in Fairfield County at 4.6 percent and in Hartford County at 4.3 percent. Increases were seen in Tolland County at 12.8 percent, in Windham County at 6.8 percent, in Litchfield County at 1.1 percent and in New Haven County at 0.7 percent.

Average List Price for condominiums in the state of Connecticut increased 7.7 percent during this period, Months of Supply decreased 3.9 percent and Price per Square Foot decreased 1.4 percent.

Connecticut Condominium Sales on the Rise


First 9 Months 2016 vs. 2015

Unit Sales 4.0%

Avg. List Price 7.7%

Months of Supply 3.9%

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Condominium Sales on the Rise

Condominium MarketplaceMonths of Supply First 9 Months 2015 vs. 2016

COUNTY 2015 2016 % DIFF.

Fairfield 6.8 6.7 -1.3%

Hartford 6.2 6.2 -1.0%

Litchfield 12.2 9.5 -21.7%

Middlesex 9.3 7.5 -19.7%

New Haven 7.9 7.8 -1.7%

New London 9.6 8.6 -10.2%

Tolland 9.6 9.3 -3.0%

Windham 9.8 10.0 +1.9%

TOTAL 7.5 7.2 -3.9%

Condominium MarketplaceHome Sales First 9 Months 2015 vs. 2016

NUMBER OF UNITS SOLD AVERAGE SALES PRICE

COUNTY 2015 2016 % DIFF. 2015 2016 % DIFF.

Fairfield 2,003 2,104 +5.0% $336,562 $321,063 -4.6%

Hartford 1,545 1,571 +1.7% $175,753 $168,229 -4.3%

Litchfield 220 235 +6.8% $127,885 $129,246 +1.1%

Middlesex 284 289 +1.8% $176,735 $166,925 -5.6%

New Haven 1,406 1,459 +3.8% $160,706 $161,837 +0.7%

New London 288 324 +12.5% $174,299 $155,890 -10.6%

Tolland 174 165 -5.2% $157,681 $177,841 +12.8%

Windham 58 69 +19.0% $131,721 $140,651 +6.8%

STATEWIDE 5,978 6,216 +4.0% $223,386 $216,248 -3.2%


Connecticut | 2015 Full Year Housing Report 7

As the housing market picks up steam, homeowners are beginning to ask themselves “what do I deserve in a home.” According to the Best in American Living Blog, home design features that aren’t necessary, but desired are leading to soaring sales. These features

include oversized kitchen islands, spa-like en suites, flexible spaces that can be used as a craft cave or an office or a guest suite, outdoor entertaining spaces, extensive entryways and beautiful master bedrooms.

Needs and Wants Differentiated in Today’s Homebuyers


Connecticut | 2015 Full Year Housing Report 8

In the past year, single women made up 17 percent of all homebuyers, according to a new report from the National Association of REALTORS®. Single women are purchasing at more than twice the rate of single males, and they represent the second largest home buying group, next to married couples. What do single women want in the housing market? According to Builder, one of the keys is going above and beyond

listing specifications—instead, you should describe the benefits of each piece. Instead of offering granite countertops, describe how they make life better by being more durable, easier to clean, etc. Additionally, consistent engagement through social media and outreach is important to differentiate yourself during the buying process.

Single Women Dominate Housing Market


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As we enter the final quarter of 2016, and look forward to 2017, the housing market continues to look increasingly healthier. According to Emerging Trends in Real Estate® 2017 – created by the Urban Land Institute, today’s real estate cycle is kinder than ever before. With transaction volume on the rise, and development on the decline, today’s business cycle, currently at 85 months (as of August 2016), is the fourth longest in US history.

Where do opportunities lie for the coming year? In the Emerging Trends in Real Estate® 2017 report, the best bets for 2017 include investment in development, specifically condo construction which is underfunded almost everywhere nationally. The report also suggests taking advantage of new construction technologies, including prefabricated and modular building and three-dimensional printing. Finally, utilization of e-commerce in the logistics supply chain will become increasingly important as consumers begin caring more about cost, transparency and speed. As builders look toward 2017, they should look toward process optimization to increase not only cost savings, but also consumer satisfaction.

Credits and Resources

1. Information contained herein is based on information obtained from CMLS, CTMLS, GRWMLS and DARMLS and is deemed accurate but not guaranteed

2. Housing permit data source: Census Compiled by DECD Research

John Tarducci, MIRM, CMP, CRBSenior Vice President

William Raveis New Development Services

[email protected]

o: 203.925.4587c: 203.640.6930


2017 Outlook

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