Connecticut is on the smaller end of American states, ranking 29th in the United States in terms of population, and is the third smallest in terms of area. It is a classic New England state, known for its colonial architecture, green spaces, and classic small American towns. It is also a state where many of the wealthy residents of the surrounding big cities like New York City or Boston go to escape the chaos of city life.
With areas like Greenwich, which are homes to sprawling estate-like mansions, Connecticut attracts some of the country’s richest to their wealthiest areas. Recent years have seen the population of Connecticut shrink though, as the state has stagnated. But in 2020, brought on by a pandemic that sent city-dwellers scattering, Connecticut’s real estate market has experienced a huge boom year.
…more than half of the homes that were sold in Connecticut for above $750,000 were sold to residents from other states.
According to U.S News, in 2019, Connecticut’s population decreased by 7,520 residents. In 2020, their population increased by over 16,500. This is a drastic increase considering just a year before the state was losing residents. This isn’t because of some type of population boom within the state, it is because out-of-state residents came to Connecticut in droves in 2020, which is a trend that is particularly noticeable in the luxury real estate market.
According to ctinsider.com, more than half of the homes that were sold in Connecticut for above $750,000 were sold to residents from other states. 30% of the people who bought these homes came from New York, while 25% came from other states. Having a majority of your luxury real estate be sold to people who aren’t residents of your state is something quite rare, but the pandemic created the perfect storm for this type of real estate anomaly.
Being in a big city during a pandemic can be a scary thing, and many cities from New York to San Francisco experienced a large migration. Richer residents who have the ability to move were prodded into action by lockdowns and given extra mobility due to work from home. Being near to the office isn’t a necessity anymore, so the big city didn’t hold the same value to some residents.
As well, in New York or San Francisco, even the wealthier residents might not have the large spaces Connecticut offers. Connecticut real estate is significantly more spacious than big-city counterparts, and with quarantine in effect in most places, having a large home space is more desirable than ever.
One of the side effects of this migration to Connecticut is a loss in the affordability of the state. The median sales price for a home rose to a state-record $300,000 in 2020, which was a 15.4% increase from 2019 according to the same report by U.S News.
According to NBC Connecticut, it wasn’t just the prices of homes that were going up, it was also the number of homes sold. Sales in just about every town of the state, with some areas having extremely profound explosions in the number of homes sold. Greenwich, Warren, and Salisbury all had more than 50% more homes sold in 2020 than in 2019, with growths of 51%, 213%, and 160% respectively.
As we move closer to a widely available vaccine, some might wonder if there will be another exodus from Connecticut. But with work from home likely to stay viable for the near future, and pandemic fears still rampant, the spaciousness and comparative quiet of Connecticut remains extremely attractive. 2020 was a banner year for the state’s real estate market, and 2021 could continue the extremely positive trend.