Recent market data tells the real story
Local news sources have been reporting on the positive impact of interstate migration funneling new residents into CT as a distancing measure related to Covid-19. With interest piqued by these developments, we did some research as an attempt to measure the benefits of this peripheral good fortune. What we found is not exactly in alignment with local reporting.
While it is encouraging to see an influx of newcomers take residence within the nutmeg state, it’s important to note the number of residents currently leaving the state still outnumbers those coming in at this time, rendering an effective net loss in the state’s population and its potential to increase the tax base. This can be a sticking point for buyers concerned about resale down the road in the event of waning housing demand, post-pandemic.
While CT has reduced the exodus by 5% during the pandemic, we are still seeing 14% more people leave the state than enter the state.
The graph below illustrates the difference between out of state buyers purchasing homes in CT and sellers leaving the state and taking up residency in another state.
Data sourced from the CT Statewide MLS
For the purposes of this report, we have chosen to focus on
Hartford County
Retention
As previously stated, CT has been seeing an influx of new residents migrating into the state from neighboring metropolitan areas, mostly New York City and understandably so. Destinations within Connecticut have always attracted visitors from New York and Boston. A large transient population visits annually, but few stay long term and claim residency. Recent reporting shows a 33% gain in incoming population, without deciphering between buyers and renters, resulting largely from the Covid-19 forces. This is a familiar theme that does not appear to be changing.
©2020, Statewide MLS. All rights reserved.
In order for any state to prosper, it needs to fuel and sustain an established CBD (Central Business District). This serves as the main business hub that creates growth and fosters future development on multiple levels. It places the focus squarely upon Hartford County centered around the City of Hartford as its nucleus for achieving a baseline of activity from which to begin. The graph displayed above, illustrates the current state of residential real estate within Hartford County. While recent state reports show an influx of new residents as a whole, Hartford County market data tells a different story. Without a vibrant CBD from which to orchestrate sustainable growth, the challenges become insurmountable. In order to create lasting change, it's incumbent upon us to drill down and address the root causes that set the table for the steps that follow. This necessitates a grassroots effort to create progressive residual growth that becomes self-sustaining through the cooperation of the Public and Private sector. This creates a segue from residential to commercial real estate and the underlying market forces that need to exist in order for both sectors to prosper. Aside from immediate public safety related to the virus, our focus is most productive when it is placed upon the root causes of the challenges we face as a Community, Town, County and State….
In upcoming newsletters we will drill down and explore our Coastal towns, the impact of cash sales on current values and the probability of another real estate crash.
Until then, we welcome your comments, recommendations and interpretation of our findings. Give some thought to why people are leaving the state and how we can help to retain them.
Info from ©2020, Statewide MLS. All rights reserved.
Posted by Seaport Real Estate Services on
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