Through the first two months of the year, buyer interest in condos has been relatively mild. The February data on contracts in Hartford County show that 26% fewer deals came together this February versus last. Overall, there is 8.6 months of supply, which by definition makes it a buyer’s market (6 months of supply is the threshold).
Despite the relatively high inventory levels, the supply is not always distributed in the same manner as the demand. Some complexes have a lot of units for sale with very little apparent interest, while other communities that are perennial favorites with buyers have maybe one or two available.
The most curious data point in the whole table is the number of contracts in South Windsor. There are a lot of condo communities in town, and South Windsor is usually one of the leaders in terms of total annual deals. Last year there were 106, while in the year before there were 110. This year has been a completely different story. There were only 4 in January, and just 2 in February.
Their inventory number is actually quite reasonable, at 6.2 months – a much more balanced market than some of the towns that are strongly favoring buyers. Scanning through the active listings, most of the big South Windsor communities do have a couple of units available, but not as many as in the past year. As a specific example, one complex had 14 closings since 1/1/2010 and currently has 2 active listings and 1 under contract. Is the huge drop in activity a supply problem, a demand problem, or a mismatch of the two?
It’s not yet clear what is going to happen in the condo markets this year. As the chart below shows, the number of transactions has been considerably lower in the past few years. The first two months of this year point to an even slower 2011 than 2010. Are the buyers simply waiting until the weather improves before they get serious about their search? More listings will appear as April approaches, but will owners look to sell their units at the same pace as they have in previous years?
