Foreclosed Houses for Sale in Eastern Connecticut
In April, New London County in Eastern Connecticut registered its first increase in home sales in almost two years due largely to the rise in foreclosed houses for sale, according to Boston-based real estate research firm Warren Group.
Aside from low mortgage rates and the tax incentive for first-time buyers, the increase in sales compared to the previous month was also due to large numbers of homes priced from $100,000 to $200,000, according to John Bolduc, head of the Eastern Connecticut Association of Realtors.
Across Connecticut, prices of single-family houses have been dropping, according to Warren Group researchers. Statewide, the median price has fallen to $227,500 in April from the median home price of $263,000 in April 2008.
In New London, single-family home sales increased by 17.8 percent in April from the previous month. The single-family house median price fell by 11.9 percent from $244,000 to $215,000.
Compared to April 2008, sales dropped by 18.6 percent and prices fell by 14.3 percent.
Although median prices of condos also declined by 28.3 percent to $145,500 from the previous month’s median price of $203,000, sales still fell by 48.7 percent.
According to Warren Group, the last time New London had a month-to-month increase in home sales was two years ago.
Carol Christiansen, head of the New London Realtor Association, said lower-priced foreclosed houses for sale and non-foreclosures priced below $230,000 usually sell quickly, with many of the units receiving a lot of offers. She added that houses priced from $300,000 to $450,000 were not receiving many offers because there were only a few move-up buyers.
Christiansen mentioned that Pfizer Inc.’s layoff of about 500 scientists affected sales of higher-priced houses. She also related the increase in short sales in the area, stating that more than 50 percent of sales of homes priced below $200,000 were short sales.
Timothy Warren, CEO of Warren Group, explained that pay cuts, job losses and consumer debt increased the number of foreclosed houses for sale, pushed down prices and limited the increase in home sales.
Warren also said that bank owned foreclosed houses for sale statewide also accounted for most of the rise in home sales in the first quarter. These houses sold an average of only $80,000, dragging down the median home price.
Additionally, Warren Group said that while home sales increased in New London, total sales of non-foreclosure homes and foreclosed houses for sale statewide declined by over 20 percent, compared to April last year.
