Hartford Business Journal Special Editions

44 Hartford Business Journal • decemBer 28, 2015 www.HartfordBusiness.com BOOK OF LISTS 2015-2016 Real Estate CT public-policy decisions will drive home values By Curt Clemens Sr., President/founder, Century 21/Clemens & Sons, Rocky Hill/West Hartford H opefully our state leaders can get their act together and bal- ance the budget and reduce taxes concurrently. If that occurs, I expect that overall Connecticut home prices will increase from 2 percent to 3 percent in 2016 and unit sales volume will stay the same as this year or increase 1 percent to 2 percent. For the Greater Hartford area, I pre- dict price increases in the 2 percent to 5 percent range and unit sales volume will stay about the same as this year. The reason for this difference is that Hartford has a more diversified busi- ness base and employment should be more stable than in some other parts of the state. C o n s u m e r confidence plays an important role in real estate sales. My biggest concern would be a large-scale ter- rorist attack with- in the borders of the United States. That would great- ly reduce consumer confidence. Given that such an attack will not likely occur, I anticipate that our econ- omy will continue to plod along and that the Fed will make a token rate increase, which would give a short shot in the arm to home sales. n 2016 REAL ESTATE OUTLOOK First-time buyers, investors rule By Sandy Maier Schede, Broker/owner of Maier Real Estate in Meriden, and 2015 president of the Connecticut Association of Realtors R esidential home sales in Great- er Hartford and Connecticut have been good this year, with pockets of towns experiencing extremely active markets while some others maintain varying levels of activity. Statewide, single-family home sales have increased 5.7 percent since October 2014 and should continue to increase over the next year. The great news is that interest rates on home loans have remained stable and at a rate that was not seen for decades. The first-time-buyer market remains strong and many Millennials have entered the market. Rental rates have risen, creating an incentive to purchase investment prop- erties in order to rent them out. The increase in cash purchas- es will continue into 2016 as inves- tors look for sta- bility and income through real estate vs. stock purchas- es. Jobless claims are at their lowest levels since 1973 and are a positive influence in the marketplace and will continue into 2016. Federal Housing Administration financing guidelines for condominiums have been adjusted to make condo- miniums easier to finance in a late-year change that will affect 2016 condo sales. The biggest concern for 2016 would be interest rate increases by the Federal Reserve Bank, which could affect the marketplace. Also, there is a lag between changes and seeing effects. If the Fed increased rates but did not see a negative effect on the market, they might raise rates again only to learn the damage had been done and was now exac- erbated. This could slow a market that has taken years to gain the momentum it cur- rently has with steady upward growth in terms of sales and buyer confidence. n Less demand for overpriced properties By Joanne Breen, Co-owner of ERA Sargis-Breen Real Estate in Newington, and president of the Greater Hartford Association of Realtors H eading into 2016, we are likely to see a busy early spring beginning after the first of the year. Hopefully that activity will continue through most of the summer, similar to the way it did this year. As a result, closed sales have continued to rise substantially over last year. There is a lot of pent-up demand on both the buying and the selling side — especially among those people wanting to move up from smaller to larger homes. That being said, I don't see prices going up in 2016. Hopefully, the market has sta- bilized and in 2016 we will see values hold- ing. I think we will continue to see small pockets of high- demand properties that will generate multiple offers, so buyers need to be aware that they aren't the only ones who may recognize a good deal when it becomes available. Serious sell- ers who price their houses aggressively will do very well in 2016; but the market remains price sensitive and overpriced properties will continue to sit. n Job stability, interest rates are housing's 'X' factors By Candace Adams, CEO, Berkshire Hathaway Real Estate Services New England in Wallingord C onnecticut's housing market con- tinues to be stable, not robust. With mounting inventory, price declines are likely, however the number of sold prop- erties should remain the same or slightly increase in 2016. The higher-end market has seen growing inventory and longer days on market. Builders are still not showing signs of confidence in single- family projects, thus limiting the newer home selection. As inventory mounts and pricing declines slightly, there will be opportunity for investors and first-time home buyers. The market could change dramatically with rising interest rates or further exiting of Connecticut employers. If a large employer such as GE decides to leave Connecticut causing relocation or unemployment, there could be an influx of homes to the market, further impacting price. The election will have its usual impact on the market, leaving some prospective buyers on the sidelines. n Sandy Maier Schede Joanne Breen Candace Adams Curt Clemens Sr. ▶ ▶ As inventory mounts and pricing declines slightly, there will be opportunity for investors and first-time home buyers. ▶ ▶ There is a lot of pent-up demand on both the buying and the selling side — especially among those people wanting to move up from smaller to larger homes. ▶ ▶ My biggest concern would be a large- scale terrorist attack within the borders of the United States. That would greatly reduce consumer confidence.

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