Buyers have ‘green light’ as real estate accelerates

P1-Real-Estate-CStrike while the iron is hot. That is the message local Realtors are telling prospective buyers as the real estate market continued to surge in the second quarter. “There’s definitely a lot more enthusiasm to buy — buyers have been given the green light to buy and the market has now turned the corner in buyers’ sentiment,” said Laura Freed Ancona of William Pitt. “There’s still lots of hope amongst prospective buyers that they haven’t missed the bottom and they can still get significant value at top price… “Our biggest challenge now is the increased interest rates — if they don’t stabilize, that could begin to dampen sales.” As of Monday, July 8, Ms. Freed Ancona said 129 units — 115 single-family homes and 14 condos — had been sold this spring, a 29% increase from the 92 units sold last year and a 46% increase from the 69 units sold in 2011. In addition, 58 houses are pending under contract and 55 under deposit. “In theory, there’s another 113 homes pending or under deposit and that activity would have happened in the second quarter,” Ms. Freed Ancona explained. “The average closing period is 60 days so we won’t see those sales until the end of the month or the end of the summer.” While the general overview of the market remains positive, the upper end market is making a “strong comeback” with 25 single-family homes closed at above $1 million, said Bob Neumann of Neumann Real Estate. Thirty-two single-family houses listed at above $1 million are under contract or under deposit, according to Mr. Neumann. “Of the 329 single family homes available, 108 are under deposit or waiting to be closed — that’s 33% of the market,” he added. “Of those 108, there are 32 homes listed above $1 million, which is almost a third. “The million-plus price range is always an active market here, but there’s been lots of activity this year, especially in the $1.5-million-plus market.” Six houses closed this year that were listed above $1.5 million, while another 10 are under contract — three of which are above $3 million. The most expensive home sold in the second quarter was a five-bedroom, 6,500 square-foot house on two-plus acres, which sold for $1,915,000, according to Ms. Freed Ancona. As for lowest price for a single-family home, Mr. Neumann said a house went for $142,000 in the second quarter, while the lowest priced closing was $242,500 last year. In comparison to the 70 units sold from January to March, there were 45 units that transferred in just two weeks from June 20 to July 2, bringing the total number of units sold to 199 this year. “Traditionally, end of March through June and into July is our busiest time of the year,” Ms. Freed Ancona added. “We’ve seen an increase in both median sales price and average home price this quarter.” The median sales price went from $527,750 in the first quarter to $595,000 in the spring, but was still down slightly from where it was last year at this time. In the second quarter of 2012, the average home price was $762,036, while the average home price this spring was $636,000. Similar to this year, the most expensive home sold last spring was a five-bedroom, 10,000-square-foot house on two acres, which went for $1.9 million. “We’re not seeing that much of an average price increase yet,” Mr. Neumann said. “Interest rates are rising across the board, though, and that has gotten people off the fence; it’s made them more anxious than in previous years.” Conveyance tax, the fee the town collects on all property transfers, including lots and commercial property, was above budgeted figures in the second quarter, signaling a rise in the volume of homes sold and the median price of sales. The town took in a total of $200,635 from conveyance taxes, collecting $49,927 in April, $59,557 in May and $91,151 in June — all up from last year, according to Town Clerk Barbara Serfilippi. “Very nice way to end the fiscal year,” she said. Condominium closings went from eight last year to 23 in the second quarter this year — a noticeable increase. Prices ranged from a $105,000 unit at Casagmo to a $747,000 unit at the Regency, said Mr. Neumann. According to Prudential Connecticut Realty’s town overview, there are 36 condos on the market and 56 rental units available. Across the state, the real estate market is looking up. Home sales in Connecticut were up almost 3% in May, rising to the highest level of transactions for the month since 2010, according to the Warrern Group, publisher of the Commercial Record. A total of 2,356 single-family homes sold in May at the median price of $268,500, up 8% from a year ago. Looking forward, local Realtors believe there will be steady activity throughout the remaining two quarters. Despite the optimism, Mr. Neumann acknowledged that storms in 2011 and 2012 ruined the final quarter of each year. “We expect to be busy in the third quarter and if there are no hurricanes or brutal winter storms later this year, then we should remain pretty active,” he said. “The market has really made great strides this year and we hope that continues.”

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