Contributed by Donald Klepper-Smith, Economist, DataCore Partners LLC
Connecticut's spring homebuying season got off to a strong start in March, with sales of single-family houses racking up double-digit gains and prices perking up for the first time in a year, a new report shows.
Sales of single-family houses jumped 11 percent to 1,768, compared with 1,594 a year ago, according to The Warren Group, which tracks real estate trends in New England. This was the strongest showing for March since 2010, when there were 2,310 sales, The Warren Group said.
Prices also were up for the first time in more than a year. The median sale price: in which half the sales are above, half below: rose 3 percent to $232,000, compared with $225,000 a year ago.
"The numbers suggest the housing recovery this spring should remain moderately strong," says Donald L. Klepper-Smith, an economist at DataCore Partners Inc. in New Haven.
"Traveling down the road to homeownership we're seeing a series of green lights."
The upsides include an improving job market, lower listing prices, and affordable mortgage rates, he said, but noted that the report's finding that price gains were modest reflects the large volume of residential properties for sale.
"The economy is improving, but not enough that we are looking at a big upside in the appreciation of home values. Inventory is changing hands, but there is enough inventory out there that you shouldn't expect to get top dollar for your home," said Klepper-Smith.
Home sales lost ground in January but recorded double-digit year-over-year increases in both February and March. The median price, which hadn't risen since February 2014, showed an uptick in March.
Hopes for a third straight year of gains in the state's housing market fizzled in 2014. Buyer caution was heightened by uncertainties in Connecticut's job market, even though mortgage rates remained low and listing prices dropped in many towns.
The state's housing market is still recovering from a downturn dating to 2007.
Real estate agents say that visits to open houses so far this spring have been strong, an encouraging sign for the season's market, traditionally the busiest of the year.
"You never know, once the weather gets nice and people have been cooped up all winter, whether they are going to show up at open houses or just go out and enjoy the nice weather," said Paula Fahy Ostop, a real estate agent at Ellyn Marshall & Associates/William Raveis in West Hartford. "But this year, there has been solid traffic everywhere."
Ostop said it was still too early to say for sure that buyer momentum will continue building this spring, "but I absolutely believe it is going to."
The heaviest interest is among first-time home buyers, although homes in the mid-price range: $300,000 to $500,000: also are drawing more attention. Sales of higher-end homes are still slow, Ostop said.
Ostop believes the Hartford-area housing market still needs a boost from increased jobs to sustain growth long-term.
A review of sales and price data for the state's eight counties painted a more uneven picture for March. In Hartford County, sales of single-family houses rose just 2 percent. The median price, however, increased nearly 7 percent, to $203,000, from $190,000 a year ago.
The median price can be influenced by the mix of houses sold, especially if sales numbers are low.
Single-family house sales rose in seven of the state's eight counties, falling in just Tolland County. The biggest percentage gain was registered in Windham County.
Hartford led the way in median price gains, with two other counties, New London and Windham, showing more modest increases. Tolland County was flat, while Fairfield, Litchfield and New Haven counties had declines.
The Warren Group draws its statistics from public records filed with towns and cities.
Statewide, sales of condominiums rose nearly 15 percent. Prices, however, fell by a little more than 3 percent.
"March was a robust month for both condo and single-family home sales," said Timothy J. Warren, Jr., chief executive of The Warren Group. "Both increased by double digits despite stormy winter weather. This is a strong indicator that buyers are back shopping for new homes after a lackluster year in 2014."