It may be that 2017 is best remembered as the year the real estate recovery finally got a foothold in Connecticut. Statewide, sales of single-family homes rose a respectable 5 percent and the median price of a single-family home rose 1 percent to $249,900, according to analysis from The Warren Group, publisher of The Commercial Record.

Despite state budget battles and high-profile companies being lured away by states with lower taxes, the gains seen last year can be attributed to one thing: lower inventory.

In Hartford County sales were up 5 percent and prices stayed essentially flat. The city of Hartford saw sales jump 13 percent and prices up 2 percent.

“Last spring we had such a shortage of inventory, it drove prices up,” said Julie Corrado of Coldwell Banker in South Windsor. “I expect the same thing to happen this year, because we’ve already seen multiple offers in January and February despite the gloomy and gray weather. I just sold a house in Cromwell [in Middlesex County]. It was listed at $995,000 and we got three offers including a full-price offer in the first week and a half. If you price a home right and market it and show it well, it will sell.”

West Hartford is a perennially desirable city and there are plenty of eager buyers in the $350,000 to $550,000 range, she said.

“This year and last year I’ve been feeling more optimistic, mostly due to lack of inventory,” Corrado said. “Some people are nervous about higher taxes driving people out of the state, but there are still plenty of people who love Connecticut for what we offer.”

Pent-up demand is pushing up prices and rising prices are bringing out sellers, she said, so she’s bullish on 2018.

“People are getting more for their homes than they would have two or three years ago,” she said. “I think 2018 will bring more sellers to the market who might’ve wanted to sell earlier, but it didn’t make sense.”

Cautious Optimism in New Construction

Rising values can turn home sellers into new homebuyers, and while that market is also seeing improvement, Joel Grossman, who manages Calcagni’s New Homes Division, said his optimism for 2018 is tempered.

“We don’t quite have full confidence yet,” Grossman said. “A 1 percent increase in prices is good, but I would say we’re seeing good foot traffic. People are interested and that’s good. I see stability in the lower and mid-price points instead of declines. That’s all good for the long term.”

Grossman also said he is seeing new home sales pick up.

“We’re seeing increases in the lower price points, which is – depending on the town – upwards of around $300,000,” Grossman said. “You see much faster sales and lower inventory. We have two to three months of inventory, which is makes it more of a sellers’ market. It’s very encouraging. People who want to can now move up. Over $400,000 we start to see a little bit of a slowdown, depending on the town. They still sell, but a little slower.”

New inventory is lagging demand in part because it takes so long to get a subdivision approved and built, he said. Across the board, the number of new homes sold in 2017 was down slightly compared to 2016 in New Haven County.

“People come in and would like to buy, but they don’t have the luxury of waiting for these homes to come on line,” he said.

At Home in Connecticut

The state’s high taxes and budget woes are holding the real estate market back somewhat, but Grossman says plenty of people are moving here from out of state, and he thinks state government will correct its course.

“The government is doing what they can to make the state as attractive as possible for people to come and stay,” Grossman said. “I see them working diligently to correct it. We have a single-family subdivision in Southington and we’ve seen more people move into it from out of state than in-state. The CT Realtors have stepped up in their lobbying efforts and they’re doing everything they can to encourage homeownership. Give us a Connecticut we can sell and let’s get more product out there. People want to buy.”

He has bridled optimism for 2018 as well.

“I’m confident and positive about 2018,” Grossman said. “People don’t buy houses for tax advantages, they buy them for a place to live. I’m bullish on real estate, especially new construction. People value energy efficiency and technology. People like new things – cars, clothes and houses. They get what they want.”