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The Connecticut real estate market was off to a fantastic start in 2020, until came coronavirus. Governor Ned Lamont ordered a partial shutdown of the economy on March 24, causing significant turbulence to the future of the real estate market. As of today, a partial opening is set for May 20, 2020.
THE IMMEDIATE EFFECT OF CORONAVIRUS ON THE CT MARKET:
While we only have numbers through the close of April, the market does not appear to have significantly impacted closed sales immediately, with April 2020 closed sales down just 8% from last April:
Sales prices of closed homes through April were also still on the rise, with April 2020 median closed sales prices at a 5 year peak at $261,000:
Home marketing time remained at a 5 year low, even through April with the median days on market at just 43 days:
THE FUTURE EFFECT OF CORONAVIRUS ON THE CT MARKET:
While all seems well at onset, the true effect of the shutdown on the Connecticut real estate market is still unknown. The trouble lies with the sharp decrease in homes that have entered market. With both sellers and buyers uncertain and scared, new listing inventory has dropped by 15% in March, and a whopping 55% in April:
This lack of inventory comes at a time when lenders are simultaneously tightening up lending criteria and buyers have less job security than ever before. With inventory currently at record lows, homes are still moving right now. But what will happen when all those sellers waiting to list enter market and to a reduced buyer pool? A downturn is inevitable, and it is only a matter of time.