Processing Your Payment

Please do not leave this page until complete. This can take a few moments.

December 28, 2020 Economic Forecast

CT’s hot home sales market to continue in 2021; tight inventory a threat

Photo | HBJ file

Q&A talks with Candace Adams, the president and CEO of Berkshire Hathaway HomeServices New England, New York and Westchester Properties.

Connecticut’s housing market is coming off a very unusual year, as the COVID-19 pandemic led to a relative boom in single-family home sales and prices. Can you give a brief overview of what took place in the market?

2020 started off a very strong year for real estate sales in Connecticut. Historically low interest rates and pent-up demand spurred a flurry of activity early in the year.

The market came to a halt in March when COVID cases started rising. It was virtually at a standstill through April, and in May people began to start migrating out of densely populated areas.

Connecticut deemed real estate as “essential,” therefore we were able to conduct business using CDC protocols. A wave of buyers came into the market. This was due to multiple factors.

First, the pent-up spring demand of buyers who were already in the market, and second, the migration out of densely populated areas brought significant activity to the market. Listings that had been on the market for several months were now selling with multiple offers. Buyers have moved further from urban centers and are migrating to areas of the state in addition to Fairfield County, including New Haven, Hartford, Litchfield and New London counties.

Windham County has also seen surges from the Boston area. Low interest rates were propelling first-time buyers into the market, and Millennials who were now able to work from home decided to enter the market.

What do you see as the main drivers that drove up demand for homes?

As sellers started to feel more confident about listing their homes, the market heated up with nearly every property being shown to multiple buyers and many selling after receiving multiple offers. That continues today.

COVID brought out a psychological need to “nest” and vertical living became less appealing. Single-family residences are in high demand, with home offices, pools and gyms becoming the most searched keywords.

As we enter the first quarter of 2021, infections have been surging. Will that merely increase demand further?

2021 should continue to be active with continued buyer demand and low interest rates. The wildcard will be inventory available. As more people have refinanced their homes or decided to do renovations, fewer listings are coming to the market.

It is our hope that builders will continue to bring new product to the market to meet some of the demand.

Do you see the buying boom lasting through 2021? What factors might push things back down to more normal levels?

The buying boom will no doubt balance out midyear as the virus subsides and most of the demand has been met. A new trend will emerge that will be impacted by migration patterns, interest rates, employment and consumer confidence.

It is likely that the market will become more normal with available inventory and ample buyer demand. Working from home will no doubt continue into the unforeseen future and will allow people to move further out of densely populated urban areas as well as suburbs.

What’s the current state of Connecticut’s housing inventory?

The current state of Connecticut inventory is that there is less than 3 months of inventory available. It is at an all-time low and it will impact the market as we move into 2021.

More listings have come to the market this fall vs. last fall as a result of “pent-up” sellers. Many have delayed listing their homes due to the pandemic.

Sign up for Enews

Most Recent

Most Recent

0 Comments

Order a PDF