The Connecticut housing market of 2024 undoubtedly tilts in favor of sellers, characterized by rising prices, fierce competition, and limited inventory. However, this does not discount the opportunities available for savvy buyers who navigate the market with strategic planning and timely decision-making. Here's more data about this market.
Connecticut Housing Market Trends in 2024
How is the Housing Market Doing Currently?
In January 2024, the Connecticut housing market showcased remarkable strength, with home prices experiencing a notable surge. According to the data from Redfin, compared to the previous year, home prices soared by 12.4%, reaching a median price of $378,200. This spike in prices reflects the enduring demand for housing in the region.
However, amidst the surge in prices, there was a slight downturn in the number of homes sold. Year over year, the number of homes sold decreased by 6.2%, with 2,318 homes changing hands in January 2024 compared to 2,470 in January 2023. Despite this decline, the market remains robust, driven by a combination of consumer confidence and favorable lending conditions.
Furthermore, the median days on the market decreased by 7 days year over year, standing at 46 days in January 2024. This reduction indicates a swift pace in the real estate transactions, reflecting the efficiency of the market.
How Competitive is the Connecticut Housing Market?
The Connecticut housing market paints a picture of fierce competition among buyers vying for their dream homes. With 50.5% of homes selling above the list price in January 2024, there is a clear indication of intense bidding wars and limited inventory.
Moreover, the percentage of homes with price drops slightly increased from 14.0% in January 2023 to 15.9% in January 2024. While this uptick suggests a slightly more balanced market, it still signifies the seller's advantage prevailing in many segments.
Additionally, the sale-to-list price ratio surged to 101.3% in January 2024, showcasing the willingness of buyers to pay premiums to secure their desired properties. This phenomenon underscores the competitiveness and determination prevalent in the market.
Are There Enough Homes for Sale in Connecticut to Meet Buyer Demand?
Despite the robust demand for housing in Connecticut, the supply side of the equation presents a challenge. In January 2024, there were 7,249 homes for sale, marking a 15.9% decrease compared to the previous year. Similarly, the number of newly listed homes saw a decline of 11.7% year over year, further exacerbating the supply shortage.
With an average months of supply standing at 2 months, down from the previous year, buyers face limited options and heightened competition for available properties. This scarcity of inventory underscores the need for innovative solutions to address the growing demand in the market.
What is the Future Market Outlook for Connecticut?
As we gaze into the horizon of the Connecticut housing market, several factors come into play that may shape its trajectory in the coming months. The economic landscape, interest rate fluctuations, and government policies are among the myriad factors that could influence market dynamics.
While the market currently leans towards sellers, there are indications of stabilization and balancing in certain segments. However, the resilience of the market in adapting to changing conditions bodes well for its long-term sustainability.
Connecticut Housing Market Forecast 2024 and 2025
Average Home Value:
According to Zillow, as of February 29, 2024, the average home value in Connecticut stands at $384,244, marking a substantial 11.1% increase compared to the previous year. This surge in home values reflects the ongoing demand for housing in the state, driven by factors such as population growth and economic prosperity.
Days to Pending:
One noteworthy metric is the time it takes for homes to go pending after being listed. In Connecticut, homes typically go pending in approximately 10 days, indicating a fast-paced market where properties are in high demand.
For Sale Inventory:
As of February 29, 2024, there were 4,801 homes listed for sale in Connecticut. This inventory provides prospective buyers with a range of options to choose from, contributing to the diversity of the housing market.
New Listings:
During the same period, 1,908 new listings entered the market. The influx of new listings demonstrates continued activity and interest in the Connecticut housing market, offering opportunities for both buyers and sellers.
Median Sale to List Ratio:
The median sale to list ratio, which measures the relationship between the sale price and the list price, was 1.007 as of January 31, 2024. A ratio above 1 indicates that homes are typically selling for slightly above their list price, reflecting a competitive market environment.
Median Sale Price:
The median sale price in Connecticut as of January 31, 2024, was $345,250. This figure represents the middle point of all home sale prices in the state, offering insight into the overall affordability and value of properties.
Median List Price:
On February 29, 2024, the median list price for homes in Connecticut was $397,967. This price point reflects the expectations of sellers and provides guidance for prospective buyers in their property search.
Percent of Sales Over/Under List Price:
According to Zillow data from January 31, 2024, 56.3% of home sales in Connecticut were above the list price, while 33.0% were below the list price. These figures underscore the competitive nature of the market, where bidding wars and negotiation tactics play a significant role in the final sale price.
Are Home Prices Dropping in Connecticut?
As of the latest data available, there is no indication of home prices dropping in Connecticut. On the contrary, home prices have been steadily increasing, reflecting strong demand and limited inventory. The current state of the housing market in Connecticut varies depending on the region.
Generally, the market leans towards being a seller's market due to factors such as low inventory levels, high demand, and competitive bidding wars. In seller's markets, there are typically more buyers than available properties, giving sellers the upper hand in negotiations and often resulting in multiple offers above asking price.
Is Now a Good Time to Buy a House in Connecticut?
Whether now is a good time to buy a house depends on various factors, including personal circumstances, financial readiness, and long-term goals. Despite the competitive nature of the market, low mortgage rates and favorable lending conditions make it an attractive time for buyers looking to enter the housing market. Additionally, buying a house can be a sound investment for those seeking stability and building equity over time.
Regional Housing Market Forecast for Connecticut
Hartford, CT:
- Base Date (31-01-2024): As of the base date, Hartford's housing market showed promising growth with a forecasted increase of 0.8% by February 29, 2024.
- 29-02-2024: The forecasted growth accelerated to 3.2%, indicating a significant uptick in housing demand and activity within the region.
- 30-04-2024: By April 30, 2024, the housing market in Hartford is expected to experience a robust 7.1% increase, reflecting sustained momentum and market resilience.
- 31-01-2025: Looking further ahead, the forecast suggests continued growth with a projected increase of 7.1% by January 31, 2025, highlighting the region's long-term viability and attractiveness for real estate investment.
Bridgeport, CT:
- Base Date (31-01-2024): Bridgeport's housing market started with a forecasted growth rate of 0.5% as of January 31, 2024.
- 29-02-2024: By the end of February 2024, the growth rate is expected to rise to 2.4%, indicating increased demand and market activity in the region.
- 30-04-2024: The forecasted growth continues to accelerate, reaching 5.7% by April 30, 2024, reflecting strong market dynamics and favorable conditions for buyers and sellers alike.
- 31-01-2025: Looking ahead to January 31, 2025, the forecast suggests sustained growth with a projected increase of 5.7%, highlighting Bridgeport's resilience and attractiveness as a real estate market.
New Haven, CT:
- Base Date (31-01-2024): As of January 31, 2024, New Haven's housing market began with a forecasted growth rate of 0.5%.
- 29-02-2024: By February 29, 2024, the growth rate is expected to climb to 2.2%, signaling growing demand and activity within the region.
- 30-04-2024: The forecast anticipates a further increase in growth, reaching 6.6% by April 30, 2024, indicating strong market performance and favorable conditions for buyers and sellers.
- 31-01-2025: Looking ahead to January 31, 2025, the forecast projects continued growth with a forecasted increase of 6.6%, highlighting New Haven's position as a thriving real estate market.
Norwich, CT:
- Base Date (31-01-2024): Norwich's housing market started with a forecasted growth rate of 0.7% as of January 31, 2024.
- 29-02-2024: By the end of February 2024, the growth rate is expected to rise to 2.8%, indicating increasing demand and market activity within the region.
- 30-04-2024: The forecasted growth continues to accelerate, reaching 7.0% by April 30, 2024, reflecting strong market dynamics and favorable conditions for buyers and sellers.
- 31-01-2025: Looking ahead to January 31, 2025, the forecast suggests sustained growth with a projected increase of 7.0%, highlighting Norwich's resilience and attractiveness as a real estate market.
Torrington, CT:
- Base Date (31-01-2024): Torrington's housing market started with a forecasted growth rate of 0.5% as of January 31, 2024.
- 29-02-2024: By the end of February 2024, the growth rate is expected to rise to 2.1%, indicating increasing demand and market activity within the region.
- 30-04-2024: The forecasted growth continues to accelerate, reaching 6.6% by April 30, 2024, reflecting strong market dynamics and favorable conditions for buyers and sellers.
- 31-01-2025: Looking ahead to January 31, 2025, the forecast suggests sustained growth with a projected increase of 6.6%, highlighting Torrington's resilience and attractiveness as a real estate market.
Overall, the regional housing market forecasts for Connecticut illustrate a positive outlook characterized by steady growth, increasing demand, and favorable market conditions across various regions within the state.
Will the Housing Market Crash in Connecticut?
Connecticut's housing market has been performing strongly in recent years, but with the current state of the economy and the ongoing pandemic, some are wondering if a crash is on the horizon.
The market has shown resilience despite external challenges, and key indicators such as demand, inventory levels, and price trends suggest stability. However, it's essential to monitor economic conditions and market dynamics closely for any potential shifts that could impact the housing market.
While no one can predict the future with certainty, here are some factors to consider when evaluating the likelihood of a housing market crash in Connecticut.
There is undoubtedly a slowdown in the pace of home sales in the Connecticut housing market, but it is more of a return to normalcy. This is neither a crash nor a bubble; housing demand is still present. The slowdown is ideal for buyers who are weary of being outbid in a hot Connecticut real estate market or who are experiencing buyer fatigue.
When there is a boom in the housing market, it is in part generated by an increase in job growth and a fall in the unemployment rate. The relationship between the economy and the housing market cannot be severed. The strength of the economy and the rate of job growth both have an impact on the purchasing power of prospective homeowners. Connecticut ranks among the top five wealthiest states in the country due to the number of residents who travel to well-paying jobs in New York City and the number of significant corporations with headquarters in the state.
Connecticut also has the fourth-highest percentage of college-educated residents (about 35.6%) and is home to Yale University, which U.S. News & World Reports rated third in the nation in 2015. According to Connecticut State Comptroller, the labor market remains strong. Nationally, there are nearly two job openings for every unemployed worker. Connecticut added 1,600 jobs in May and has now recovered 83% of the jobs lost during the pandemic, including 86% of private sector jobs.
Three sectors — construction, professional and business services, and trade, transportation, and utilities — have added jobs above pre-pandemic levels. Connecticut’s per capita income of $82,918 is the third-highest in the country and, today is increasing the state’s minimum wage to $14 per hour. The state has recovered 83% of the jobs lost during Covid-19 and 3 industry sectors have rescued over 100% of the jobs lost.
Home prices are directly affected by demand, which, according to real estate experts, isn't going away anytime soon. However, they are not rising as quickly as they once did, and Connecticut real estate agents predict that prices will level off or rise slightly this year. Some of this is most likely due to rising interest rates.
Sources:
- https://fred.stlouisfed.org/series/TNSTHPI#
- https://www.neighborhoodscout.com/ct/real-estate
- https://www.ctrealtors.com/
- https://www.osc.ct.gov/public/pressrl/2022/Jul012022_Financial_Status.pdf
- https://www.ctinsider.com/connecticutmagazine/article/Whats-next-real-estate-market-connecticut-17023057.php