CT sales of homes over $2 million spike as migration from NYC continues

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Sales of houses for more than $2 million have nearly tripled in Connecticut since 2019, according to a real estate company's report.

Sales of houses for more than $2 million have nearly tripled in Connecticut since 2019, according to a real estate company's report.

Rogelio V. Solis / Associated Press

The number of houses sold for $2 million or more in Connecticut has nearly tripled since 2019, which real estate experts said is likely the result of increased migration from New York City and second-home purchases along the state’s coast.

So-called “luxury home” sales were up by about 194 percent through the third quarter of this year compared with the first three quarters of 2019, according to a market report from real estate firm Berkshire Hathaway HomeServices.

From Jan. 1 to Sept. 30, a total of 1,201 homes sold for $2 million-plus in Connecticut. 

In the same time last year, the state saw 684 sales at or above that lofty price point, according to the report. In 2019, there were about 400 such sales, according to a Hearst Connecticut Media Group analysis of the data.

“We’ve seen this momentum in the past year in the higher end and that’s continued,” said Candace Adams, president and chief executive officer at Berkshire Hathaway. “We will probably have a very strong market through 2022, however we’re seeing prices stabilize and we’re seeing overpriced properties have price reductions.”

As work-from-home options have become more popular, many families moved out of New York City seeking more space, real estate agents said. Others are opting to make Connecticut coastal cities, such as Greenwich, their weekend and summer abode.

In just the third quarter of this year, Greenwich and New Canaan had the largest numbers of sales at 212 and 51, respectively.

Still, Fairfield County’s proximity to New York City has meant that nearly every town has seen increases in upper-end home sales, Adams said. People move out of the city -- either for their primary or secondary homes -- but want to stay within a distance so they can commute to the city a couple of times per week.

“We see affluent buyers making choices to predominantly buy second primary homes to have alternative choices for lifestyles outside of the city,” she said. “So you have money and you have people who are looking for luxury, and that’s where they’re putting it right now.”

Julie Grace Burke, a real estate agent with Compass, said she has three clients buying second houses in Greenwich. Two of them are giving up second homes in other locations, she said.

“If you work in the city and your family decamps to Greenwich, you can jump on a train or in your car and you’re still in your office in an hour. But if you decamp to Montauk there’s absolutely no way for that to happen,” she said.

Inventory is low, often driving prices higher, agents said.

On average, last year, Connecticut homes selling for more than $2 million sold for about $3.38 million. This year, it’s up to $3.42 million, according to the Berkshire-Hathaway report.

In New Canaan, last week there were only about 70 houses on the market total. In years past, it’s been closer to 300 this time of year, said Melissa Rwambuya, president of the New Canaan Board of Realtors.

But the higher-end and luxury markets aren’t seeing the same level of spirited bidding wars that were commonplace at the start of the pandemic.

“With inventory low and buyers out there, you’d think that would continue the frenzy,” said Rita Kirby, an agent with William Pitt and Julia B. Fee Sotheby’s International Realty who works primarily in New Canaan and lower Fairfield County. “But I think when people get up to that number, while there is competition, it’s not a frenzy.”

The lack of inventory also means for those who want to sell, it’s hard for sellers to find a new place to live, agents said.

Many who live in upper-end houses want to sell their houses, hoping to downsize and turn a profit in the elevated market. But with low inventory after a period of heightened number of sales, it’s difficult to find a house, Rwambuya said.

“I feel like the best way to describe it is we kind of have a frozen market,” Rwambuya said. “There’s people that want to move, but they’re saying ‘where do I move to?’”

The pandemic hasn’t just affected the number of home sales or prices, it’s changed what people are looking for in a home.

Houses with more land, further away from town centers are making a comeback, said Greenwich agent Robin Kencel who works at Compass. 

People want more space; home offices with doors are also of heightened interest. More people also want backyard pools, she said.

Before the pandemic, buyers were typically more interested in open-concept homes, agents said.

“I found that amenities that used to be nice-to-haves or wish-list items became must-haves and non-negotiables,” Burke said. “While yes, inventory is tight and therefore buyers just have to choose from what’s available, they have pushed their budgets, given the low rates, to the maximum possible to ensure there’s a yard, ideally there is a pool and there is at least one if not multiple home offices that are spacious and have doors that close off.”

And fewer buyers, especially in the higher-end market, want houses that need renovation because disrupted supply chains have caused the cost of construction materials to go up.

“It’s very difficult to even acquire new appliances, so people that are considering a renovation because construction costs are high and it’s hard to source materials,” Rwambuya said.