GOOD Deals is a biweekly column about Wilton real estate published in partnership with Kerry Gutierrez with Douglas Elliman Real Estate.
Knowing the right time to sell your home can be like trying to predict the weather. With the local and national housing market in constant flux, many homeowners have been holding off, waiting for that perfect time to maximize profits from their current homes and secure the next one at a moderate price and lower mortgage rate. But what if waiting is more of a gamble than a sure bet? As of mid-2024, Connecticut’s real estate market, like many regions across the US, remains a seller’s market despite high interest rates. Will it shift to a buyer’s market? Absolutely — and possibly sooner than you think.
Driving the current seller’s market has been the historically low inventory that has made the real estate market feel like a Black Friday sale. New data suggests that inventory levels may be on the verge of improvement. Data from the FRED Economic data of the St. Louis Fed shows a 36.6% national increase in active listings on a typical day in July compared to the same time in 2023. While this is still well below what we saw between 2017 and 2019, the trend is moving in the right direction.
Realtor.com also reported that in July, the average home spent 50 days on the market nationwide, five days longer than the same time last year. This is the third consecutive month where homes have lingered on the market longer than the previous year, signaling a shift from the pandemic-fueled buying frenzy of 2020-2022. Buyers are now taking a more measured approach, slowing down their purchasing decisions.
Wilton’s Real Estate Market
So, how does Wilton compare to the national trends? Houses are selling fast in Wilton, and the average ratio of List to Sale Price for 2024 is 107%, as demand far exceeds supply. There are currently 31 homes for sale in Wilton, a grim number even for July. SmartMLS shows this is 33% lower than last year and a staggering 53% lower than in 2022. More strikingly, the average July inventory from 2003 to 2019 was 261 homes — a whopping 88% reduction. Neighboring towns like Westport, Weston, and Redding have seen similar declines over the same period. So, while it’s still a seller’s market in Wilton and neighboring towns, Connecticut generally follows the national trends, and there’s no reason to think lower Fairfield County will not soon see inventory levels change course.
Buyers are now taking a more measured approach, slowing down their purchasing decisions. Kerry Gutierrez
Higher interest rates remain, among the most significant obstacles to a normalized real estate market. Still, confidence is growing for a September rate cut by the Fed based on recent economic data showing a softening job market and a cooling economy. On Friday, the Labor Department reported that employers created just 114,000 jobs in July, far short of what economists were forecasting (175,000), and the unemployment rate rose unexpectedly from 4.1% to 4.3%. Furthermore, the Wolters Kluwer Blue Chip Economic Indicator Survey predicts the economy will grow less than 2% annually in the second half of the year compared to 2.8% in the second quarter.
While remaining elevated and shackled to the Fed’s effort to contain inflation, mortgage rates are still significantly lower than in October 2023, when the 30-year fixed rate peaked at 7.8%. They will likely decrease as the Fed lowers its benchmark rate and are widely expected to continue decreasing into 2025. The 3% mortgages are long gone, but hovering just under 7%, the 30-year fixed rate is still below the 53-year average of 7.73%, according to the St. Louis Fed FRED:
Home prices are still hovering near record highs, with the Case-Shiller Home Price Index showing a 5.89% year-over-year increase. However, this trend might not hold. Some buyers may exit the market as the economy softens, while others gain more negotiation leverage. This shift will push sellers to drop prices, offering a ray of hope for buyers waiting on the sidelines for a boost in their purchasing power.
While I don’t have a crystal ball to tell me when the real estate market will return to normalcy, I believe change is on the horizon. The trio of higher rates, inflation and elevated housing prices are losing momentum. Buyers are backing away from irrational purchases, and homeowners sitting on the sidelines waiting for the right time to sell are taking a gamble. Instead of waiting for the elusive perfect moment, homeowners should focus on their personal goals and needs and not let the fear of missing out on a few extra dollars drive their decision. There is hope for a return to a more balanced market shortly.
Like the great Kenny Rogers taught us, “You got to know when to hold ‘em, know when to fold’ em, and know when to walk away.”
Kerry Gutierrez is a licensed Real Estate Salesperson with Douglas Elliman and a 12-year resident of Wilton. With deep knowledge of Wilton, its neighboring towns, and all of Fairfield County, Kerry combines her analytical skills with market data, industry trends, and personal insights to guide clients in making smart, informed decisions. If you have questions about real estate or are considering a move, reach out to Kerry Gutierrez via email or at 917.929.1740.
The information provided through this column is not and shall not be construed as tax, accounting, legal, regulatory or other professional advice or sufficient to satisfy any tax, accounting, legal, regulatory or other professional requirements. The content represents the personal views and opinions of the author and does not necessarily reflect the positions or opinions of GOOD Morning Wilton.
