Bank Owned Homes for Sale Cut Prices in Eastern Connecticut

by Peter Vernon on States

Bank owned homes for sale pulled down prices in Eastern Connecticut in 2009, particularly in New London and Norwich, according to data from the Eastern Connecticut Association of Realtors.

The volume of home sales increased, but median prices decreased. In Norwich, the sales price median for single-family homes dropped from $180,000 in 2008 to $165,000 in 2009. In New London, the median sales price dropped to $154,650, about $25,000 lower than the median in 2008.

According to Stonington broker Les Bray, the increase in home sales was driven by the affordability of FSBO homes and broker-marketed homes.

John Bolduc, head of the realtor association, also said that the increase in sales is expected to wipe out the inventory of repo houses and to hasten housing market recovery in 2010.

Other Connecticut towns with increased home sales were Lisbon, where sales shot up by more than 200 percent; North Stonington, where sales increased by 27 percent; Montville, which experienced a 23-percent increase; and Griswold, where sales rose by 17 percent.

The communities that slowed down in home sales were Bozrah, Lyme, Lebanon and Waterford. The town of Stonington, which usually posts a large number of sales transactions, slowed down in sales by 12 percent.

Bank owned homes for sale also pulled down home prices in Eastern Connecticut in the last quarter last year despite a significant increase in sales. In the counties of Windham and New London, sales of single-family homes rose by almost 28 percent while sales of condo units increased by nearly 50 percent compared to sales in the fourth quarter of 2008. In contrast, the median price for single-family units dropped by almost five percent to $209,900.

Across Eastern Connecticut, the total sales of single-family homes rose in 2009 by 6.5 percent from 2008, but the mid-range house lost 11.3 percent in value or a total of $26,500. The total amount of home sales in Windham and New London in 2009 dropped by 8.6 percent compared to 2008.

Analysts including real estate firm Warren Group attributed the increases in home sales to the federal tax credit. They hope that its extension and expansion would further improve sales in 2010.

In a report released by a California-based research firm, total foreclosure filings in Connecticut reached 19,679, down by more than 10 percent from 2008, but up by 66 percent from filings in 2007. Bank owned homes for sale in Norwich and in New London contributed significantly to the 21th-place ranking of the state based on foreclosure rates in 2009.

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