It is still too early to say if gains median sale prices of single-family houses in Connecticut in January and March are signs of an emerging trend for 2018. (Feverpitched / Getty Images/iStockphoto)
Home sale prices across Connecticut jumped for the second month in a row in February, but the sales volume was weak, a new report Monday showed, and some experts said it it still too early in the year to declare the start of a trend.
The statewide median sale price of a single-family house — where half the sales are above, half below — rose 7.2 percent in February, to $237,000, from $221,000 for the same month a year ago, according to the report from The Warren Group, the publisher of The Commercial Record.
February sales fell 3 percent for the same period, the report showed.
Donald L. Klepper-Smith, an economist at DataCore Partners Inc. in Durham, said the roughly 7 percent price increase “looks to be somewhat of an anomaly given current economic fundamentals.”
“Job growth is nonexistent and full job recovery isn’t expected until the end of 2019,” Klepper-Smith said, in an email. “Add in the fact that traction in the housing markets in tied to traction in the labor markets and you can see that the small sample we have the first two months is probably overstating strength in the Connecticut housing market.”
…the small sample we have the first two months is probably overstating strength in the Connecticut housing market. — Donald L. Klepper-Smith, economist, DataCore Partners
Through the first two months of 2018, the statewide median sale price rose nearly 5 percent, to $235,950, from $225,000 for the same period a year ago. Sales fell 2.3 percent.
In Hartford County, the median sale price rose 2.7 percent in February, to $195,000, from $189,900 for the same month a year ago, on a nearly 9 percent decline in sales.
Klepper-Smith pointed to the two-month trends in Hartford County — median prices down 2.3 percent and sales down 6.6 percent — as a more accurate reflection of the market.
“The year-to-date county [median price] data for the eight counties is all over the map, with a high of +16 percent and a low of -8 percent,” Klepper-Smith said. “Talk about pockets of strength and weakness!”
Timothy Warren, The Warren Group’s chief executive, said the inventory of homes for sale is dropping in Connecticut — and may be contributing to the higher prices.
“Closings from the spring real estate shopping season peak in the summer months,” Warren said in a release. “We’ll soon know if this trend continues or if homeowners rush to put their homes on the market to take advantage of higher prices.”
We’ll soon know if this trend continues or if homeowners rush to put their homes on the market to take advantage of higher prices. — Timothy Warren, chief executive, The Warren Group
Connecticut home prices are still struggling to recover from the last recession. Last year, the annual median sale price registered a modest, 1.6 percent, year-over-year gain.
The annual median sale price was the second increase in a row and a bit stronger than 2016, which was less than 1 percent. But the median sale price was still 15 percent lower than the most recent peak in 2007.
Economists say they don’t expect a lot of change in 2018 and affordability could be nicked by rising interest rates. The state’s fiscal troubles also have not been definitively resolved and job growth remains lackluster.
Swings in the median price do not necessarily mean all prices or home values are moving in the same direction. Home prices can vary widely from town to town or even neighborhood to neighborhood, and they are influenced by location, property condition and updates to kitchens and bathrooms.
The median price also can be influenced by the mix of houses sold. Even so, the median is considered a good barometer of broad market trends.