A second-quarter real estate report shows continued improvement in Connecticut”™s housing market.
Single-family home sales statewide increased 10.5 percent last quarter compared with the same period last year and condominium home sales increased 17.6 percent, according to a report by Prudential Connecticut Realty.
After a strong first half of the year, the state is off to a promising start for the remaining half of 2013, said Terence Beaty, director of Prudential”™s new homes and land division.
“We have a really strong position,” Beaty said. “We just need higher confidence among our buyers and these kinds of numbers are going to make that happen.”
Since the third quarter of 2012, the median price of a single-family house had been slowly declining. However this quarter the trend took a positive turn.
The median price of a single-family home rose 10 percent between the first and second quarters of the year to $249,000. However, the price increase is just 2.7 percent higher than the price of a home last year.
In Fairfield County, prices increased 2.2 percent year over year, to $460,000. Fairfield also saw a 16.5 percent increase in sales.
Home prices in the state are still recovering at a slower rate than the national average. However, Beaty says, the state could rely on the real estate market as a leading source of growth.
Many states are seeing their real estate markets bounce back, pulling their economies out of the recession and into a period of growth. But, as Connecticut has been one of the last states to exit the recession, it will likely take more time before the median prices picks up, Beaty said. A number of issues still plague the state”™s recovery, such as high unemployment rates, but if housing inventory rates continue to be low in the state, prices will eventually start to come around, Beaty said.
Experts say median home prices will remain flat for the rest of the year in Connecticut, but good things could be in store for the remainder of the year. Last year, the second half of the year was stronger than the first in terms of prices, Beaty said.
Among the more promising indicators for the remainder of the year is the number of pending contracts this quarter. Year over year, new deposits increased 13 percent on sold homes and 29 percent for sold condos.
Fairfield County saw the biggest increase in pending contacts with a 23 percent hike in single-family homes and a 38 percent increase in condos.
Beaty said the increase in condo contracts was likely because it was easier to finance a condo purchase this year compared with previous years when there was a tightened grip on borrowing and other condo regulations. The increase may also stem from the backlog of first-time homebuyers who had held off from buying before the market improved, Beaty said.
“The young buyers are the ones we need to be more active,” Beaty said. “If they do that, everything else can take care of itself.”
