Hartford County had 727 single-family homes deals come together during the month of October. The total was about 3% fewer than October 2016, though on a year-to-date basis the market is very slightly ahead of 2016.
Discussion of the State budget situation was unavoidable during October. It was regularly a leading news story, and was not fully resolved until the Governor signed a budget on Halloween. Budget talk seemed to come up all the time, in a way that made it plausible for the budget uncertainty to have a cooling effect on the regional real estate market. Now that the data is in, we can attempt to answer whether the State budget situation actually impacted buyer behavior.
Taking the widest possible view, a 3% variance from last year suggests that the budget debate wasn’t such a big deal. The chart at the top shows a tight cluster of October contract totals over the past three years. There was no huge miss for the month. Additionally, the chart shows that wild month-to-month swings are actually not unusual for the County. At a high level, there is no way to say that the uncertainty about the State budget definitely slowed the market in October.
There are trends with individual towns, many of them quite interesting. However, they are year-long trends rather than new and unique situations that popped up when the State budget took over the headlines.
One of the strongest trends is that buyers are showing a lot of interest in the core price bands of the more densely populated towns. The table below shows that East Hartford, Manchester, Bristol, Hartford, and Windsor Locks experienced year-to-date deal activity increases of more than 10%. Looking more deeply into the numbers, the increases were primarily due to an uptick in contracts on homes priced in the $100,000s. The October results for those five towns ranged from a 112% increase in the number of month-over-month deals to an 18% decrease. Again, it is not possible to reach a definitive conclusion about the impact of the State budget standoff.
The narrowest view of the impact of the State budget uncertainty comes from conversations with individuals interested in real estate. Numerous home shoppers that I interacted with over the past month independently raised the State budget as a concern. I had multiple guests at a Hartford open house tell me they that lived in West Hartford and were concerned about buying a larger home in West Hartford because of the potential for even more property taxes if the State cut education funding to the town (as was proposed at one point by the Governor). My own buyer clients noted the budget standoff as a concern, though they did not tie it to any specific decisions. Agents in my office reported conversations about the State budget with their clients too.
At the end of the day, it is important to recognize that all sorts of factors impact the real estate markets. The State budget was the primary talking point in October. It was definitely on people’s minds, and influenced their decisions. However, there is no convincing statistical evidence (that we’ve seen) that those individual decisions caused October to be an unusual month in the noisy world of real estate.
It is interesting though … I wonder what everyone will be talking about in November?