At the beginning of March, it looked like the coronavirus pandemic was going to derail the housing market. People stopped listing their homes for sale and single-family sales plummeted as people sheltered in place.

Three months later, homes are being snatched up within one day of being listed; there is a bidding war on every home, and sale prices are rising. The coronavirus, or at least economic conditions caused by the virus, has led to a sizzling market not seen in Connecticut since before the Great Recession, Realtor association presidents say.

Mark Gilrain, a Realtor at Halstead and the president of the Mid Fairfield County Association of Realtors, said the real estate market in Fairfield County, one of the largest markets in Connecticut, had been falling behind in early March.

Single-family home sales were down about 3 percent year-to-date compared to the same period in 2019. As the coronavirus forced the local economy into lockdown, single-family home sales in Fairfield County declined 25 percent compared to 2019.

But in May, sales began to rebound. By June 22, the industry had clawed its way back and suddenly had more single-family home sales year-to-date than through the same time period in 2019. As of June 22, real estate agents had reported 5,405 single-family home sales in Fairfield County to the statewide multiple listings service, compared to 5,378 by June 22, 2019, according to Gilrain.

New York Buyers Return

And this is a trend that is playing out across the state, added Joanne Breen, 2020 president of CT REALTORS and a broker at ERA Sargis-Breen Real Estate Co. Breen said median sales prices across the board are up anywhere from 5 to 17 percent. All of this is happening while inventory in every single county in the state is down by about 30 percent year-over-year, she said.

“This is the hottest market I’ve seen since 2007,” said Breen. “It’s important to note that Connecticut was the only state [in New England] prior to this year that was lagging behind. Everyone around us was already seeing a boom market for the last couple of years, whereas we had not.”

Part of the surge can be attributed to the influx of buyers that have flowed from New York into the Fairfield and Litchfield counties to escape the density of the city, which was hammered by the coronavirus in March and April.

“The New York buyers are so used to paying such high prices that the higher-end homes now have a larger market of people looking for them,” said Breen, who said the higher-end homes had previously been a much more difficult sell. “There are bidding wars on every property.”

Previously, the Connecticut housing market was more of a buyer’s market. As a result, Breen said buyers were even discounting good homes that needed moderate cosmetic work in search of “turnkey” homes that were all ready to go.

Now, the low inventory is starting to make people a little bit more flexible, as all home types are seeing demand. Gilrain said he has seen all property types going quickly from $250,000 condos to more pricey waterfront homes that previously weren’t selling as well.

For instance, Gilrain said he inquired on behalf of a client about a waterfront home in Westport going for about $2.2 million, and the owner had already received 27 calls inquiring about the property and conducted 11 showings. Gilrain also said properties he listed in New Haven County are going quickly, too.

Will Inventory Return?

While Breen said she is already seeing higher sales prices, Gilrain said he expects to see broader rises across the market shortly.

“It will take sustained sets of people losing out on multiple offer situations,” he said. “After they try to buy [a home] six times and still haven’t been able to get one, they are going to start paying more now because it’s worth it to have a roof over their head.’”

A big question is whether inventory can come back up at all, but both Gilraine and Breen see a market categorized by lower inventory and higher demand being sustainable for most of the year.

Low mortgage rates and the increasing popularity of working from home and the remote economy are driving demand, and could also make Connecticut a more attractive state to live in and potentially lead to more population inflow, the two say.

Indeed, Zillow reported last week that Greater Hartford saw a 29 percent decline in for-sale inventory last month, to 4,783 homes and condominiums, compared to May 2019.

Ultimately, Breen believes everything happening in Connecticut’s real estate market right now is largely positive.

“People say to me, ‘is it a sellers market then or is it a buyers market?” said Breen. “You know that’s a hard thing to answer. I don’t think it’s swaying totally one way or another. It’s leaning toward the sellers because of the low inventory, but again, with the rates being where they are, it’s a great time to buy.”