Pandemic fuels massive growth in Connecticut home sales
Connecticut has seen a massive growth in home sales over the past two years since the start of the pandemic in the United States. State lawmakers say Connecticut was one of the top places in the country where people migrated during the pandemic. Remote work trends became normalized, allowing people to move to places where they can afford to buy a home.
State legislators gathered for the Housing, Planning and Development, Insurance Committees Informational Forum to discuss these trends, as well as some challenges the state faces in terms of prices, resources, and underbuilding.
Jessica Lautz, deputy chief economist and vice president of research at the National Association of Realtors, said the drive to move to Connecticut mainly comes from those seeking affordability. The state typically had lower interest rates and lots of housing available. However, since the burst over the past two years, prices have increased, and there are fewer homes for purchase.
Lautz said there is a lack of inventory and underbuilding, given the demand for homes.
“What I would encourage in every local community is not only to look at the struggles of bringing a brand-new home into that community, but also look at ways of converting existing buildings into residential properties,” Lautz said. “Whether that means conversions of hotels, motels, vacant malls — anything that could bring in a residential unit could be quite helpful. Lautz also suggested looking into ways to bring in new properties and build a better inventory for Connecticut residents.
The forum also focused on the lack of building materials within the state. Robert Dietz, chief economist and senior vice president for economics and housing policy with the National Association of Home Builders, said that demand for building materials is higher than ever and that building entry-level construction will lead to affordable housing.
He referred to the “5 L’s” – lack of labor, lots, lumber, lending to builders and legal and regulatory burdens. Dietz said there is a 12% growth rate in building materials – the cost has not decreased, but the supply is slowly increasing for contractors.