Chief Economist of National Association of Realtors Speech at the Norwalk Inn

Last week, Laurence Yun, the chief economist of N.A.R. spoke for about 90 minutes about the state of the real estate market in Connecticut as well as nationally. 

While once the wealthiest state in the nation, many of the wealthier residents have started to leave Connecticut.  This has been enhanced, in part, by the new tax laws which disadvantage states that have real estate taxes greater than $10,000/year, the limit by the new tax laws, as well as more expensive homes for which the $750,000 mortgage limit means that mortgage amounts above that will no longer be tax deductible. 

2018 GDP was +2.9%, a healthy number, but not sufficient to cover the additional costs of the tax cuts, which means that the Federal debt will be increasing significantly.  There have been some
economists that feel that a recession might be on the horizon.  Mr. Yun is more optimistic, feeling that very low interest rates might be able to sustain a continued prosperity for longer than what we have currently experienced (though he did note that there were some signals in the yield curve that might suggest that possibility) .  The fundamentals, he pointed out are still strong and consumer sentiment is also very strong (availability of jobs a factor).  The number of short sales and foreclosures are also down significantly to more historic levels.

On a national level, real estate affordability ( a measure of what people can afford based on income and debt) is actually higher than in the year 2000 (when mortgage rates were at 8%).

Job growth in Connecticut has been mixed.  In our area (Bridgeport to Stamford) it has fallen about 3% from the year 2000.  However, during the same time period New Haven saw job growth of 4%.
Further east the Norwich/New London area saw no growth. 

Weekly earning are rising, and there appears to be the capacity to expand.  At issue, in some locals, is that there are not enough qualified people to fill jobs. 

The Fed appears ready to be 'patient' and will likely not be raising interest rates until at least 2020.

Demand for starter homes remains strong throughout the country (including Connecticut), though in some places there is a lack of inventory.

The confluence of low rates and high consumer confidence are good indicators of a strong real estate market.  California and Connecticut are two areas where this has not been manifested, though the number of information requests for mortgage pre-approvals has been on the rise.

Existing home sales were slightly off nationwide, but new home sales are on the rise.  Resales of slightly older 'McMansions' were struggling, and the high end in Connecticut is 'soft'.  What had been a 10% differential between new and existing home sale prices has now widened to about 20-25%.  The growth of inventory has been slow nationwide, and housing starts for new housing is running behind demand. 

New home starts are down in Connecticut but Multi family starts are up.

In the past a typical period of time that people stayed in their homes was 7 years.  Today it is 10-11 years.  Consumers appear less excited about inventory choices.  More people not moving is an indication that people don't feel that their lives are improving (which is when they typically buy).

Unaffordable rents in the New York City market place are an indicator that there may be a shift of those people towards purchasing outside of the 5 boroughs. 

Student debt has also been a drag on millenials purchasing homes. 

In my next blog, I will speak about future solutions to improve Connecticuts real estate market  mentioned by Dr. Yun.

Wilton & Weston April, 2019 Sales

The number of transactions for both Wilton and Weston in April were down from the previous April.
Wilton had 19 sales in April 2018 compared to 15 this year, and Weston had 10 compared to 16 in 2018.  Sales below $1 million continue to outpace the market above that number. 

There are excellent opportunities for buyers looking for value throughout the market.

Here are the properties that traded in Wilton this April:
190 Cannon Road                         $310,000
12 Tall Trees Lane                          490,000
25 Cardinal lane                              540,000
69 Range Road                                550,000
103 Catalpa Road                            555,000
25 Ridge lane                                   555,000
3 Roxbury Lane                                630,000
1 Crowne Pond Lane                        635,000
74 Old Driftway                                700,000
105 Scarlet Oak drive                        820,000
280 Cheesespring Road                     850,000
107 Pipers Hill Road                         899,000
57 Old Farm Road                             975,000
65 Hurlbutt Street                             1,112,500
66 Borglum                                       1,262,500

Here are the Weston properties that closed in April:

81 Blue Spruce Circle                          227,950
129 Good Hill Road                             575,000
53 Treadwell Lane                               689,000
1 Cartbridge Road                                699,000
157 Godfrey Road East                        775,000
37 Osborn Farm road                            830,000
4 Smith Farm road                               1,060,000
4 Norfield road                                     1,118,000
45 Hemlock Ridge road                       1,300,000
63 Fanton Hill road                             1,400,000

Westport Property Transfers April 2019

The April 2019 closings were nearly identical to those of April 2018.  Here are the
properties that closed:

27 Whitney Glen                                              $ 410,000
103 Harvest Commons                                        720,000
4 Davenport Ave.                                                 385,000
6 Abbotts Lane                                                     390,000
7 Fairport Road                                                    526,000
12 Fillow Street                                                    535,500
250 Wilton Road                                                  575,000
11 Fairport Road                                                  612,000
42 Kingshighway South                                       616,875
5 Whitney Street                                                   660,000
4 Robin Hill road                                                  670,000
29 Cross Highway                                                 700,000
5 Davis Lane                                                         740,000
148 Greens Farms Road                                        764,000
15 Silver Brook Road                                            775,000
9 Birchwood Lane                                                  790,000
21 Crooked Mile road                                             900,000
45 Marion Road                                                      985,000
9 Melon Patch Road                                              1,000,000
4 Scofield Place                                                     1,042,000
41 Burr Farms Road                                               1,100,000
10 Ridge Drive                                                       1,304,500
19 Bauer Place Extension                                       1,475,000
4 Tamarac Road                                                       1,527,500
15 Bradley Street                                                     1,549,000
8 Tower Ridge                                                         1,304,500
8 Linda Lane                                                            1,575,000
34 Bauer Place Extension                                        1,592,000
4 Berkeley Place                                                       1,600,000
36 Edgewater Hillside                                              1,675,000
146 Bayberry Lane                                                   1,675,000
168 Imperial Ave.                                                     1,720,000
7 River Lane                                                              1,775,000
12 Green Acre Lane                                                  1,950,000
6 Crystal Circle                                                         2,475,000
25 Edgemarth Hill                                                     2,500,000
11 Burr Farms Road                                                  3,050,000
2 Driftwood Road                                                      6,300,000

Wilton First Quarter 2019 results

The volume of home sales in Wilton has fared better in the first quarter of this year than last, with 41 homes that closed in the first quarter compared to 34 in the first quarter of 2018.  The highest price that sold in the first quarter of 2018 was a home at 21 School Road that sold for $2,850,000. The highest price in the first quarter of 2019 was $ 1,760,000

Looking back at the first quarter of 2018 the median price of homes that sold was $740,000.  This year's first quarter results are showing a median price of $650,000 for homes that have already closed in the first quarter.

There are currently 18 single family properties that have accepted offers.  This represents the most recent activity.  The median listing price of these homes is $630,000.  However, when we look at the median list price of the 18 homes under contract, it is now at $875,000.  The trend still feels like one of a buyer's market.  The general condition of homes on the market is still trending towards staged, updated homes attracting the most attention. Activity on the lower end of the market is strong.

Here is a list of homes that have sold in the first quarter:

9 Sunset Hill Road                                  $ 285,000
8 Wolfpit lane                                          $ 325,000
12 Pond Road                                          $ 329,000
18 Horseshoe Road                                 $  390,000
67 Old Farm Road                                   $ 420,000
35 Blue Ridge Road                                 $ 468,900
40 Pelham Lane                                        $ 481,000
81 Kensett Drive                                       $ 490,000
239 Olmstead Hill road                             $ 490,000
807 Ridgefield Road                                 $ 505,000
36 Grey Rocks Road                                 $ 508,000
152 Range Road                                        $549,000
41 Scribner Hill Road                                $560,000
200 Drum Hill Road                                  $ 570,000
24 Wilton Hunt road                                  $ 605,000
25 Sharp Hill road                                      $ 615,000
8 Roxbury lane                                           $ 620,000
134 Range Road                                         $ 625,000
163 Whipstick Road                                   $ 627,500
28 Oak Ledge Road                                    $ 635,000
48 Black Alder lane                                    $ 666,000
83 Musket Ridge road                                $  685,000
106 Indian Hill road                                    $  712,500
70 Linden Tree road                                    $  725,000
20 Fairfax Ave.                                            $  729,000
25 Millstone Road                                       $  747,000
31 Thunder Lake Road                                $  748,500
85 Kellogg Drive                                          $  800,000
37 Black alder lane                                       $  825,000
92 Turtlehead road                                        $  875,000
42 Wicks End lane                                         $  930,000
71 Coley road                                                $  975,000
194 Drum Hill road                                       $ 1,000,000
21 Little Fox lane                                           $ 1,110,000
87 Catalpa road                                              $ 1,140,000
11 Parish Road                                               $ 1,215,000
108 Nod Hill road                                          $ 1,230,000
1 Spruce Meadow Court                                $ 1,250,000
168 Linden Tree road                                     $ 1,460,000
39 Friendlee Lane                                           $ 1,582,500
235 Cheesespring Road                                   $1,760,000

Weston First Quarter Results

Weston has seen an increase in homes sold thus far this year compared to 2018.  There have been 27 homes sold in the first quarter compared to 23 in the first quarter of 2018.  However, the median price of these sales dropped from $695,000 in 2018's first quarter to $574,000 in 2019.  The highest sales price in 2019 has been 6 Calvin road, which sold at full price, $1,350,000. 

There are currently 11 properties that have accepted offers and 14 homes that are under contract.  The highest asking price of a home under contract is 25 Hemlock Ridge, listed at $1,749,000.

Here are the homes which have sold in 2019:

47 Godfrey Road West     $275,000             (listed at $290,000)
16 Weston Woods Rd.         315,000            (listed at 324,900)
10 Salem Road                    395,000            (listed at $475,000)
127 Georgetown Rd.           399,900            (listed at $389,900)
35 Blue Spruce Circle         414,101            (listed at $425,000)
106 Lords Hwy                    450,000            (listed at $474,900)
291 Newtown Tpke              460,000           (Listed at $519,900)
40 Kramer lane                     515,000          (Listed at $529,000)
16 Wilson Road                     520,000          (Listed at 529,000)
25 White Birch                      525,000          (Listed at 550,000)
7 Richmond Hill rd.              528,000          (Listed at 525,000)
9 Roscrea Place                    550,000           (Listed at $625,000)
12 Farrell Rd.                        564,000          (Listed at $624,900)
7 Cindy Rd.                           584,000          (Listed at 619,900)
55 Eleven O'Clock                620,004          (Listed at 619,900)
28 Brier Brook Rd.               625,000          (Listed at 669,000)
13 Deer Run Trail                 636,000          (Listed at 635,000)
19 Hickory lane                     645,000          (Listed at 699,000)
12 Curiosity lane                   655,500          (Listed at 699,000)
108 Birch Hill rd.                   665,000         (Listed at 685,000)
19 Laurel Lake E.                   655,000         (Listed at 699,000)
23 Riverbank rd.                     712,000         (Listed at 847,000)
23 Langner lane                       715,000         (Listed at 725,000)
12 Singing Oaks                    1,040,000        (Listed at 1,079,000)
11 Lilac Lane                          1,175,000       (Listed at 1,249,000)
275 Newtown Tpke.               1,300,000        (Listed at 1,350,000)
6 Calvin Road                         $1,350,000      (Listed at 1,350,000)

First Quarter 2019 Westport Results

Real Estate activity has had a bit of a roller coaster effect this year.  We seemed to be having a good start of the year that coincided with unseasonably warm weather in March.  Usually, things don't pick up until around February 15th, a date which usually coincides, more or less, with the Superbowl

The weather in mid to late February did not cooperate, and we saw a slowdown for a couple of weeks.  In the last couple of weeks the market has picked up again.

Recent activity can be best seen by properties that have accepted offers but have not yet gone to contract.  There are currently 39 properties that fit that category, including 28 which are listed for over $1 million.  In the early stages of the quarter we were seeing movement in less expensive properties.  The properties that are under contract are further along in the process and are more reflective of activity that occurred a little earlier.  Of the 42 properties under contract slightly more than half are over $1 million.

It could be that some people who have paid their income taxes are feeling a little better about what they paid.  The new mortgage limits and real estate tax deductions had been holding us back on the higher end.  That is evident in the number of closed sales in the early months of the year, which reflect activity that occurred two to three months before closing.

Through the first 3 months of the year Westport saw a significant downturn in the number of closed sales from the same three month period in 2018, from 84 in 2018 to 46 in 2019.  The median prices of our closings in the first quarter of 2019 seem to reflect an impact of the new tax laws, with a preponderance of properties selling near the $1 million mark.  The median price for the 46 sales has been $1,195,000.  However, the median price of the homes that have recently accepted offers is $1,495,000.  This is practically the same as the median price of first quarter closed sales in 2018, which was $1,400,000.

One should always reserve judgement after the first quarter statistics become known, because the second quarter, from April through June, is usually the busiest time of the year.  Special events such as elections can also have an impact on first quarter statistics as can the previously mentioned effects of the weather.

New Year's Resolution-Positivity

I know that today is April 1st, but this is not a joke.  And I know that New Year's resolutions are supposed to be made in January, but sometimes there are just things that seem like epiphanies that hit us later on in the year.

Like many of my fellow citizens I have been involved in watching news events on television and online on a daily basis. While the events emanating  from the workings of our representatives in Washington are engrossing (in a soap opera kind of way), I think that it has affected the general mood of the country in ways that are demonstrably negative.

This applies to both the left and the right, and although the polarities have been reinforced over the last several decades, it will likely only get worse unless every person vows to try to see the positive
in our fellow citizens and non-citizens.

Every religious faith promotes the concept of loving one's neighbor, or inviting the stranger to one's table when they are in need.  It is time to remind ourselves of this.

From negativity comes more negativity-and the reverse must therefore also be true.  The  Buddhist saying surely applies: Do not dwell in the past, do not dream of the future, concentrate the mind on the present moment.

We are a country that has always been looking toward the future, which has been a boon to our abililty to adapt to difficult situations, but sometimes one has to slow down to be more in the present before looking forward.

In the real estate business there are many sellers who are unhappy because they are not getting the return on investment that they had hoped for, and there are buyers who also fall into a similar place because they want to have a certainty of what values will be like in several years.

I invite them all to join in my new mantra.  Let's appreciate the present moment and not dwell on the past- hopefully we are in good health, and have loving friends and family. 

Let me leave you with this quote from Lamine Pearlheart:

“Life is not the problem, life is a solution. Those who think it to be endured are miserable souls and their views were shaped by negative energy, those who believe that there is anything better, are misled by their urge to live eternally and are apparent witnesses to the greatness of life since they want more of it and not less.

I know that life under a human form is a gift, few creatures get the privilege to experience it as such; to whatever cause I had the chance to experience it in its fullness in a positive way, I am utterly grateful.”