Twelve of the 17 units at The Landings, a condominium complex in Norwalk, either have been sold or reserved. Sales of condos throughout the state remained fairly steady during the first quarter of 2006.
The market is not quite as strong as it was a couple of years ago, but empty nesters and first-time homebuyers continue to fuel Connecticut’s condominium market. Condo sales remained fairly steady in the first quarter of this year, falling about 5 percent from the first quarter of last year, compared with the sales of single-family homes, which fell about 12 percent.
“It’s not the heated market it was two years ago, but it’s still more active than other parts of the market,” said Tom Shrum, who specializes in condo sales for William Pitt Sotheby’s International Realty’s Norwalk office.
The median price of condos also rose at a faster rate than that of single-family homes in the first quarter of this year, according to statistics from The Warren Group, parent company of The Commercial Record. The median price of a single-family home in Connecticut in the first quarter was $269,900, up almost 8 percent from a median price of $250,000 in the first quarter of 2005. The median price of condos rose from $165,000 in the first quarter of last year to $187,400 in the first quarter of this year – a difference of almost 14 percent.
Two groups of consumers are primarily responsible for driving the condo market, according to Shrum. First-time homebuyers gravitate toward condos because, even though their median prices are rising faster than those of single-family homes, they generally remain more affordable.
Barry Rosa, new-homes and land director for Prudential Connecticut Realty, expects condos to remain popular for that demographic. Even as the price of single-family homes evens out, those homes will still mostly remain more expensive than many of the existing condos in the state.
“[Condos] become the entry point to housing,” Rosa said.
In places like Norwalk and Stamford, median price differences are extreme. The median price for single-family homes in the first quarter of this year was $540,000, while the median price of condos was $305,900. In Stamford, the median price of single-family homes was almost $700,000, while the median for condos was slightly less than $300,000.
The other demographic fueling the condo market is older adults, Schrum said. Many people like to change their lifestyle, and are looking for a home that allows them to lock the door and leave for vacation or for a winter in Florida without worrying about mowing the lawn or cleaning gutters.
In some Fairfield County cities and towns, high-rise condominium buildings marketed to older adults are being constructed.
“That’s what you’re seeing built,” Rosa said.
New construction has proven popular in Fairfield County. Schrum has sold units in four Norwalk complexes. He and his team sold all the units in a complex called River Wake last year. They are selling the last unit in the 20-unit complex called River Watch. In a 17-unit complex called The Landings, 12 of the units have been sold or reserved, and about one-third of the units at the 23-unit 442 Main Ave., which is across from the Merritt Corporate Center, have been sold.
Schrum expects the market to remain healthy as interest rates are likely to top out, he said. Some more buyers will probably jump in when they realize the supply of condos is not increasing very fast, but demand is staying steady.
By the end of the year, Rosa expects to see the rate of condo sales to rise, as sales of single-family homes fall. In some parts of the state, new condos can be as expensive as single-family homes, but that does not deter people. Some new condos can cost more than $700,000, Rosa said. However, some people are moving into condos not because of the price, but because of the amenities.
