Local Home Sales Down, but Prices Up

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RISMEDIA, Jan. 29, 2007-(MCT)-Single-family home prices increased by nearly 2% last year over 2005, according to statistics provided by the Eastern Connecticut Association of Realtors.

That means the market is normal, stable and healthy, said John Bolduc, executive vice president of the Norwich-based group. And that insight comes from having the long view of decreases in sales, which last year came in at 6%. That's a relatively small drop, he said, and makes 2006 the third-best year in sales since 2000.

In New London County, some of the demand for housing is being created by immigrants coming to the area to work, Bolduc said. In addition, there is a large inventory of homes and interest rates being offered at a reasonable 6%, he said.

"The demand is there," Bolduc said. "We've got a great economy in eastern Connecticut. It's a great time to buy a house."

Single-family home prices edged upward by 2% in 2006, from a median price of $255,000 to $260,000, according to data on the group's Web site. An appreciation rate of 3% to 5% is considered good, he said.

Condominium sales were up about 1.5%, with slightly higher inventory and a shorter number of days on the market compared to single-family homes. The reason, Bolduc said, is because they're more affordable.

Prices were also up for condominiums, land, multifamily and commercial properties.
In contrast to houses and condominiums, sales decreased by 31% for land, nearly 34% for multifamily dwellings and more than 24% for commercial properties, according to the Web site.

Those steep declines bring the housing market as a whole to an overall drop of 9% compared to 2005, which could either be because of a lack of availability or a reluctance on the part of people to make major investments, Bolduc said.

It also isn't clear whether the 6% drop in home sales is a reflection of fewer people buying or fewer people deciding to sell, he said, but it could be a little bit of both.

Copyright © 2007, The Day, New London, Conn.
Distributed by McClatchy-Tribune Information Services.

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