SPECIAL TO THE HERALD
NEW BRITAIN -According to Greater Hartford Area Realtors Chief Executive Officer Jeff Arakelian, the real estate market in central Connecticut has been typically slow. However, once the spring market arrives, “we anticipate inventory and prices will pick up.”
Most Realtors who spoke with the Herald Press agreed with Arakelian about the current slow market.
Sal Calafiore, broker/owner SalCal Real Estate Connections, with offices in New Britain, Berlin and Plainville, expects the “buzz of rising interest rates to jump-start the market. People are trying to take advantage of the still low rates before they rise even higher. “
When the Federal Reserve raised its benchmark interest rate earlier this month, the Washington Post reported that the Fed was “launching into what investors expect to be a more rapid series of increases that will help ward off the threat of inflation, but also raise costs for indebted American households.”
Realtor Jim Krawiecki of William Raveis Real Estate, serves the Farmington Valley Area with focus on Bristol, Plainville and Southingon. Krawiecki is recipient of the Connecticut Magazine Five-Star Realtor Award for the last seven years.
He calls the current Bristol high-end market “difficult.” Anything over $400,000 is a hard sell. He cites Home and Garden Television and says the cable network has had a negative influence on the real estate business.
“It’s a reality show’s focus on homebuying and renovation,” Krawiecki said. “A lot of homebuyers, especially millennials, want perfect houses. They watch HGTV and come away with high expectations of granite marble tops and remodeled kitchens. That’s what these programs peddle. Problem is, few in this age group have the money for these houses, the TV home of their dreams.”
Yet, other Realtors report current sales are strong.
In Bristol, Ryan Smith of Tier 1, says he is selling a lot of residential, mostly to first-time buyers. “Sales are better than expected. The market is showing more signs of life than it has in the past five years.”
Addressing rising interest rates, Smith acknowledges that they traditionally depress home prices.
However, he says that “as long as rates don’t go too high there is still enough demand to overcome future rate increases. Even if rates go up a point, or even two, they are still low relative to historic standards.”
Realtor Nina Jankowski of New Britain Real Estate Exchange, said, considering the season, “sales are robust. First-time buyers are making up the bulk of sales up to $175,000.”
Multifamily homes are also selling well, she said.
“When buyers know interest rates are going up the savvy ones try to beat the next promised increase,” she says. “It keeps us busy.”
Jankowski says New Britain condominium sales are not as strong as entry-level single-family homes. “The condo market has been struggling for years, but is picking up momentum as the demand increases. Overall sales are the smallest segment in the New Britain residential real estate market, about 10 percent in 2016.”
Lack of inventory was a common complaint among area Realtors.
One reason is that lower-priced homes that come on the market are selling quickly and prices are holding steady. “A property that shows well and is in move-in condition will sell for the asking price or very close to it,” Calafiore says.
Krawiecki says inventory is down in Bristol, though he insists that homes priced properly and in good condition will sell quickly.
According to Jankowski, lack of inventory can be attributed in part to the popularity of rental apartments, despite the increase in rental prices over the past six years.
“Not everybody wants to own a home,” she said.
Smith agrees that popularity of rentals may be a reason for low inventory. Rentals are up in Bristol because of foreclosures and difficulty in getting a mortgage.
“People still need a place to live,” he said.