Fairfield County Market Recovering...Slowly

By Paul Hughes, Founder, Tough Love Real Estate
October 28, 2009

All real estate, like politics, is local.

Take Norwalk, for example.  It has the lowest priced inventory of single-family starter homes in lower Fairfield County.  Sales this year declined by less than ten percent compared to 2008.  Encouraging, all things considered.

On the other hand, homes for sale in Greenwich - the most expensively priced market - have plummeted by more than 38 percent, the worse decline in the county.

These examples are the extremes in the statistical report card for the first three quarters of 2009.  On balance, there's reason to believe that a market gripped by fear and anxiety earlier this year is beginning to stabilize.  How the market progresses going forward will hinge on unfolding economic factors that include unemployment and consumer confidence.

How things have improved

• The inventory of homes for sale has not grown significantly - good news for home sellers
• There's been a noticeable increase in deposits placed on homes for sale since March.
• The supply time of homes for sale - a key indicator of the market's health - has steadily decreased as homes are taking less time (on average) to sell.

Why things have improved

• The first-time homebuyer tax credit sent first-time buyers shopping in significant numbers in Fairfield County
• Interest rates have remained at historic lows - less than five per cent at this writing.
• Prices of homes have come down to levels where buyers see good value and growth in their investment over time.
• Financing is still available for consumers who can meet the more stringent guidelines of lenders - good credit, employment, accumulated savings, etc. A large percentage of first-time buyers are successfully obtaining Federal Housing Administration (FHA) financing of up to ninety-seven percent of purchase cost.

Interesting dynamics at work

• The hottest portion of the market is entry-level homes at the lower end of the price scale.
• Homes priced at the upper level of the market are the hardest to sell - and the most difficult to finance - due to the higher interest rates attached to "jumbo" mortgages of more than $729,250.
• Sales of condominiums have been negatively affected by the newfound affordability of single-family homes at "condo prices" and the inability of single-family owners to sell and downsize to condos.
• McMansions seem to have fallen out of favor with upscale buyers who are focusing more on quality than size.

Note to Buyers: this is the best buyer market in years and interest rates are predicted to begin rising in coming months.

Note to Sellers: the homes that sell quickly - in days or weeks - are those that are priced aggressively against their competition.

Single-Family Home Sales Fairfield County CT

Condominium Sales Fairfield County CT

back to top