Business & Tech
Cheaper Homes Reign Supreme
Martha Perry takes a look back at real estate trends in 2009 in her inaugural column.
In the face of very strong headwinds, New Canaan's real estate market is starting to move in the right direction again as 2009 draws to a close.
When the financial services industry that the community relies on for employment and wealth generation took a hit, so too did home sales in New Canaan. As of Dec. 8, sales of single family homes were 12 percent off the 2008 total. For months there was minimal activity in the real estate market.
But the market perked up in mid-May. Single family home sales in New Canaan were robust during the summer with monthly pending sales figures running well ahead of last year. And while the rally didn't keep up that exceptional pace into the fall, sales levels have continued to show gradual improvement.
The activity has been focused at the low end of the market—sales of houses priced below $1 million are actually running a whopping 48 percent ahead of 2008 while sales in higher price ranges are down substantially. Sales in the $2 million to $4 million range sank 15 percent; sales of homes valued over $3 million fell by half. The upper end of the New Canaan market has been the slowest to stabilize and is still feeling the effects of a very small buyer pool.
Until recently, the condominium market has also been exceptionally slow as down-sizing empty-nesters have found it hard to sell their bigger homes. At the same time, the decline in prices has allowed some first-time buyers to hopscotch over condominiums into starter homes. While condo sales are now on par with 2008 and continuing to improve, the market is still far from normal.
As with single family homes, the least expensive segments of the market have fared best. Sales of units priced below $1 million increased 20 percent from last year, while sales of units over $1 million declined 44 percent.
But the movement at the low end is a good sign for the market overall. Most housing recoveries begin with the entry level followed by trade-up buying. New Canaan is in keeping with this trend.
Martha Perry's real estate column appears each Friday in New Canaan Patch. She is an agent with William Pitt Sotheby's in New Canaan.
