Most of the state’s housing markets have seen leveling prices and slipping sales in recent months, but prices in New Haven County have enjoyed a steady increase, which is good news for those who own homes like this one in the Westville section of New Haven.

The story in most of Connecticut’s housing markets over the past few months has been one of leveling prices and dropping sales. The state’s year-to-date median price for single-family homes rose less than 2 percent in October, and the price dropped more than 2 percent compared to October 2005, according to statistics from The Warren Group, parent company of The Commercial Record.

But one county continues to be the star of the state in terms of prices. New Haven County’s prices in 2006 have seen a steady 8 percent increase over last year’s numbers. It is a far cry from the double-digit increases that were characteristic of 2004 and 2005, but compared to most of the state’s other counties, many of which are seeing price declines, an 8 percent increase in median prices is impressive.

But the reasons for the healthy price increase are a mystery. As is the case in the rest of the counties, sales in New Haven County are dropping – almost 15 percent year-over-year, although sales were down 2 percent in October compared with October 2005. Sales throughout the state are down almost 8 percent year-over-year.

“The prices [in New Haven County] are going up, but I’m not quite sure why that is,” said Barbara Pearce, president and chief executive officer of North Haven-based H. Pearce Real Estate Co.

According to the statistics The Warren Group released after the third quarter of the year, there was no clear pattern to the cities and towns that saw the biggest price increases in the county. Madison and Branford on the Shoreline saw increases of greater than 10 percent, as did New Haven itself and three of its northwest suburbs: Bethany, Woodbridge and Ansonia. Meriden, in the northeast corner of the county, saw an almost 15 percent price increase, and Waterbury, which is in New Haven County but not typically considered part of Greater New Haven, saw a 14 percent increase.

In the city of New Haven, year-over-year prices increased 19 percent after the third quarter.

But Pearce said her agents are not seeing the same thing. They are saying that people are not listing their houses – which could explain the sliding sales number. But there is a fair amount of inventory on the market.

Pearce hypothesized that the price increases could be a sort of catch-up. New Haven County did not see the large increases that were evident in other parts of the state over the past few years, so those numbers have some room to grow before leveling out like the rest of the state’s prices. Some cities and towns did not see much growth for the past few years, so the price increases could mean the market is normalizing, Pearce said.

Any high-end homes are moving quickly, she added. A $5 million house in Madison went on the market and sold in a week.

Economic Factor

But New Haven’s economy could have something to do with the favorable numbers, according to John Clapp, a professor of real estate and finance at the University of Connecticut.

“Their economy has done fairly well, and employment has done well there,” he said.

The biotechnology industry has seen good growth, and Department of Labor statistics showed employment in the area growing at a healthy pace.

Some of the biggest drops in number of sales and prices were in small towns that typically have relatively few transactions. In North Branford, sales in the third quarter dropped almost 54 percent compared to the third quarter of 2005, and the price for those time periods dropped more than 4 percent. The year-to-date price there, however, rose about 1 percent.

The town sees relatively few sales, though, so any change can have a large effect on percentages. In the third quarter of 2005, 54 homes were sold in North Branford, compared to 25 in the third quarter of this year.

In Middlebury, the price for the third quarter of 2006 fell more than 24 percent over the third quarter of 2005, and fell by 15 percent year-to-date. Sales there were up substantially, however. In the third quarter of 2005, 26 homes were sold there, and in the third quarter of this year, 41 homes were sold, an increase of almost 58 percent.

Guilford also saw a price drop. The price in the third quarter of 2006 fell more than 11 percent compared to the third quarter of the year before. Sales there also fell slightly. In the third quarter of last year, 91 homes were sold compared to 85 percent this year, a nearly 7 percent change.