If you've paid attention to the housing market at all over the last year, you know that it's red hot and Connecticut has some of the hottest markets in the country right now.
New information from the Greater Hartford Association of REALTORS illustrates the problem - prices are up, but inventory is down. When you compare July 2020 with July 2021, the median price jumped 15.8% from $285,000, then to $330,000 now, and over that same time period, inventory dropped more than 30%.
In fact, a new report from REMAX shows the Hartford area is in the top three nationwide for the biggest drop in inventory, along with Indianapolis and Albuquerque. REMAX says there's now less than one month's worth of inventory in the Hartford market.
NBC Connecticut's Dan Corcoran sat down with Alexa Kebalo Hughes, president of the Greater Hartford Association of REALTORS, to discuss the numbers.
Dan: So Alexa, it seems like a great market, if you are selling right now not so great if you're buying sort of things appears like they're starting to calm down at all right now.
Kebalo Hughes: So Dan, thank you so much for that. So overall, we're still seeing a huge drop in our inventory. Luckily, we used to have only 50% of our inventory. Now we're actually just down by about 30% over last year at this time. So our inventory, although it's still tight, there is still opportunity out there. But I have to be real with you, Dan, you're absolutely correct. It is phenomenal to be a seller in this market. In fact, they finally have the equity in their homes that I know a lot of people have been lacking for many years now since the housing market crashed. But all in all, it is still not a bad time to consider to make a move if you are a buyer, because there is a lot of still great opportunities out there. Especially because inventory isn't just as tight. And the interest rates are still historically low.
Dan: Yeah, let's talk about that a little bit more for those people who are looking to buy right now, should they jump in? Or should they wait a bit?
Kebalo Hughes: So honestly, no one does have a crystal ball, no one knows what the future will hold. But what I can tell you is that with the interest rates being so low, it's going to really decrease the cost of someone's...purchase price over the long term or their purchase cost overall, right. So even though our purchase price and the sales prices are still higher than traditionally, I really do believe this is more of a correction in the marketplace. Because remember, Dan, Connecticut was actually one of the last days to recover out of the entire nation. So although we're still having good appreciation month over month, and year over year with our pricing, with our interest rates being so low, I do think it is not bad time, if you're a buyer that is able to find the right home, I do think it's still a great time to try to make a move.
Dan: And like you just said none of us have a crystal ball. But is there any indication as to when the inventory could go back up and prices might start to level off a bit?
Kebalo Hughes: You know, Dan, at the end of the day, I really believe that it's going to take something that kind of moves us and shifts us, especially the people that are on the fence, right? There are so many sellers that are holding on to their inventory. And perhaps the house is too big or too small. And there's a lot of pent-up demand of sellers looking to make a move, but they're really not going to make a move until there's something that kind of pushes them off the fence. Right. So what I would like to say is what could possibly make them make a move, and I hate to say it but if the interest rates do start creeping up even more, that may make some sellers that are kind of maintaining their position to say, you know what, let me try to lock in the next home, while the interest rates are still at historic lows. So I think that will help, right? Because if we have sellers that want to make a move, they're holding on to the inventory. If something like an interest rate increase, as much as none of us really wants that. I do think factors such as that will contribute to people that are on the fence to actually list their homes and make a move to the next home.