LITCHFIELD COUNTY — The COVID-19 pandemic may be ravaging certain sectors of the economy, but not so with the real estate market. Business is booming with inventory is getting snatched up quickly, with properties selling for well over asking price and a high number of closings.
“The market has gotten quite busy,” remarked Daivd Bain, owner of Bain Real Estate in Kent. Heidi Picard-Ramsay of Berkshire Hathaway HomeServices New England in Torrington echoed a similar sentiment, “I’m busier than I’ve ever been.”
The real estate craze began in March, with New York City residents flocking to Northwest Connecticut to escape the escalating COVID-19 outbreak there. Rental properties were the first to go. “Available rentals disappeared in a flash,” said Bain. Fleeing New Yorkers were eager to find a safe place to live outside of the City.
Now, it’s the single family homes and condos that are being purchased at a fast rate. Many of those buyers are also New Yorkers. “It was already looking to be a promising year for real estate even before the pandemic hit,” explained Picard-Ramsay, citing a good economy and low mortgage rates during the first couple of months of 2020. “Anything now that’s not being priced out is going quickly.”
“Every property that comes on the market is getting multiple offers,” Picard-Ramsay continued. Bain also remarked that he has seen people get into bidding wars over available properties, too.
“I’m getting showing requests for properties even before they are officially listed,” Picard-Ramsay explained. She said she recently saw a property with 18 showings scheduled the first day it was on the market.
Properties are also selling for over asking price. “There was a home in Colebrook that sold for $50,000 over asking price at $250,000 to a cash buyer. The property would have never appraised at that amount, but the buyer didn’t care. They just wanted to have the place,” Picard-Ramsay said.
With properties getting snatched up so quickly, available inventory is shrinking and those who are looking to purchase are having a difficult time finding something that suits them, exacerbating the increase in home prices. In Kent, for example, Bain said usually around this time of year there are anywhere between 60 and 70 properties on the market. Currently there are only about 30. “We’re down by half,” he said.
Picard-Ramsay shared a similar static. “Year-to-date, we’re down about 3,000 listings, but the demand is still high.” Of her own numbers, she said, “I usually complete between 35 and 45 closings annually, but I’ve already done 20 since March 1,”
As many New Yorkers settle into their new homes, lives and routines here, some are realizing they are not interested in living in the City anymore, even after the pandemic eventually passes. “They can telecommute and work from home. And even if they need to go into the City once in a while for business, they can either hop on a train or drive in and be there within two hours,” said Picard-Ramsay.
Both Bain and Picard-Ramsay see similarities between the pandemic and the terrorist attacks of 9/11. Both events caused people to leave New York city in droves and either rent or purchase real estate in the greater metro area, including Litchfield County.
However, Picard-Ramsay cited one key difference,”This pandemic is changing the real estate market even more than 9/11 did,” she explained “Whereas 9/11 was more or less a one-off event, this pandemic is longer lasting with farther reaching effects.” As New Yorkers are realizing they can work their city jobs from homes and condos purchased in Northwest Connecticut, local buyers are starting to loose out, especially in the under $300,000 price point category.
One thing is certain, neither Bain nor Picard-Ramsay anticipate the brisk pace of home sales will subside anytime soon. Picard-Ramsay’s brokerage is anticipating the summer months of June, July and August to be busier than ever, even though traditionally late summer sees a lull in sales as summer vacation ends and kids return to school.