Category Archives: Housing

February Report: Slow Progress For Metro Hartford House Sales

by Categorized: Economy, Housing Date:

The frozen month of February brought more slow improvement to the housing market in central Connecticut, not a realization of the high hopes from a strong January report, but progress nonetheless.

The median price was up by 2.7 percent for single-family houses that sold in the 57-town area of the Greater Hartford Association of Realtors, the group said Monday. The number of closed sales 478, was up by nearly 5 percent from the same month in 2013.

The number of new listings rose by 5 percent to 1,055, but the number of days on the market also increased by more than 6 percent, to 82 days.

“It’s encouraging that even with this harsh winter, closed sales continue to rise in our housing market,” said Jeff Arakelian, the association’s president and CEO.

The modest year-over-year price increase, to $194,000, followed a 10 percent jump in January, to $220,000.

All in all, the market heads into the spring season as it has in recent years: with some momentum but no clear sign of a breakout year — other than a prediction by CoreLogic, a California-based firm, that Metro Hartford will be one of the nation’s hot housing markets in 2014.

Shiller On Live Yale YouTube Feed: Bubbles Could Get Worse

by Categorized: Economy, Housing Date:
Robert Shiller, left, and Eric Gershon at the Yale TV studio Thursday.

Robert Shiller, left, and Eric Gershon at the Yale TV studio Thursday.

Robert Shiller, who just won the Nobel prize in economics and is best known for describing speculative bubbles, doesn’t think we’re any better able to control those dangerous, irrational price run-ups these days despite all we’ve lived through.

“I don’t think that we have learned, and we are probably more vulnerable to bubbles in the information age,” Shiller said Thursday in a live YouTube broadcast at Yale.

The reason: Twitter and other instant sources of news could tend to heat up irrational behavior.

“There isn’t a science to controlling bubbles,” the Yale economist told interviewer Eric Gershon, our former colleague at The Courant.

Sure, there are measures such as limits on bank loans and rising interest rates that could flatten price curves, but Shiller said, “It’s like trying to control a crowd. If you have an angry mob outside your door what scientific method  can you use to control it?”

On the other hand, Shiller, whose 2013 Nobel prize was awarded for his work in describing how human behavior affects markets, does believe we’re getting better at that end of economics. “We’re understanding behavior better so we can make better policy.”

But what policies? Shiller is concerned about income and wealth inequality but he also sees the downside of a sharp rise in the minimum wage. And he’s very skeptical of measures to redistribute current wealth — favoring instead ways to change the rules going forward.

“I’m not saying that we shouldn’t have substantial inequality,” he said, because it provides strong incentives for people to produce and earn. “But I’m worried that inequality is going to get much worse in the future.”

And the housing market? Last year saw a price runup of 13.7 percent in the 20 largest metro areas according to the Case-Shiller index, which he helped develop. It’s not sustainable, he told Gershon, but it’s not a bubble that’s about to burst, either.

His prediction for this year: 5 percent, playing it safe like most economists do. The folks who run the Case-Shiller index predicted that Metro Hartford would rise by 8.3 percent, 5th highest in the nation, from a paltry 2.9 percent in 2013.

Shiller is about to teach a course online on Coursera called “Financial Markets,” which he thinks is a more important topic than ever, considering the rise of financial markets in the developing world.

“For anyone who wants to make a mark on our society…you have to appreciate finance because it is how we get big things done.”


Metro Hartford The No. 5 Housing Market In 2014 — Really?

by Categorized: Economy, Housing Date:

Click here for an updated version of this post, a column on

Prices of single-family houses in Metro Hartford are bouncing around not much higher than they were in the recession, but ranks the capital area as the 5th hottest market in the nation in 2014.

House prices will jump by 8.3 percent in the 12 months ending in September, according to the web site of CNN and Money magazine, based on predictions by CoreLogic, the California-based real estate analytics firm that works on the Case-Shiller index.

Um….Wow!! Could this come true? Sadly, no it can’t, although a gain of one-third that amount would mark a far better year than homeowners have seen in the better part of a decade. And that could happen, probably will, as the market continues to improve.

Along with a scenic picture of the Bulkeley Bridge walkway looking toward downtown Hartford, the web site, citing Hartford city development director Thomas Deller, says the region benefits from Obamacare. Firms such as Aetna and UnitedHealthcare are booming, the report says.

This would be news to more than 100 Aetna employees who were laid off in Hartford since the summer. The number could be much higher, as Aetna isn’t saying. The company does give quarterly headcount numbers for Connecticut  — and Sept. 30 was at 6,360, down from 6,500 on June 30, which itself was down from 6,650 on Sept. 30, 2012, part of a long, slow trend.

Don’t blame Aetna, but don’t look to the Asylum Hill company to pull Hartford’s housing market into the stratosphere, either.

Single-family house prices that sold in 2013 saw the first year-over-year price gain in three years, recording an uptick of less than 1 percent, the Greater Hartford Association of Realtors reported last week. The total number of sales was up by double-digits in the 57-town region and the number of houses on the market jumped.

My colleague Ken Gosselin reports that brokers are looking, realistically, at price gains this year in the single-digits, but sluggish job gains are keeping a boom from exploding. On Monday morning, the state Department of Labor reported that employers cut 3,900 jobs in December. does point out that the median household income in the region, $85,000, makes the median-priced house far more affordable than in many markets. And that does point to an uptick in house prices.

Still, a top-10 finish in the whole nation? Number five? CNNMoney has Oakland leading a list that includes New Orleans, Fort Worth, Richmond and Baltimore, as well as New York.  As a 20-year homeowner six blocks from the Hartford city line, I can’t think of a prediction I’d be happier to botch — but it’s not going to happen.

CT Jobs Forecast: Better, Not Great

by Categorized: Economy, Housing, Jobs Date:

NOTE: Click here for an updated version of this post — but look at the chart first.

Connecticut’s economy will build steam in 2014 and 2015 with healthy if not spectacular job gains, but will continue to lag the nation and the New England region, a new forecast shows.

Job totals, on track for just over 14,000 new positions in 2013, will climb to 18,700 in the gubernatorial election year of 2014, then 24,900 in 2015 before slowing somewhat after that, said Edward J. Deak, Fairfield University economics professor and Connecticut manager for the New England Economic Partnership, which released its twice-yearly forecast Wednesday.
Chart shows predicted job changes by percent.   Courtesy of New England Economic Project

Chart shows predicted job changes by percent.
Courtesy of New England Economic Project

The reason for Connecticut’s gains is simple: A rising national economy, which is expected to add jobs at nearly twice the rate of Connecticut in the next few years, will bring this state along in its coattails.
And the reason for Connecticut’s continued sluggishness, Deak said, is the same as what we’ve grown accustomed to seeing: High energy costs, constrained land use and, mostly, no great engine of growth, despite stirrings from the state-sponsored biotech industry.
Headwinds include continued restructuring in finance, especially as interest rates rise as expected; and competition for the casinos in neighboring states.
Manufacturing is forecast to remain flat or lose jobs.  The traditional factory strength, defense, will be bolstered by the latest jet fighter for the Pentagon, though that program is advancing more slowly than planned in part because of the federal sequester.
“It’s quite clear on the basis of what the Department of Defense is doing here that they want to see the F-35 go forward, plus that’s going to be a big export item,” Deak said Wednesday, ahead of the economic partnership’s Boston conference scheduled for Thursday.
Unemployment, which should average 7.9 percent in 2013, is forecast to drop to an average of 7.5 percent in 2014, then 7.1 percent in 2015.  It will reach 6.4 percent in 2017, Deak predicts, and even that number is well above the 4 percent to 5 percent levels of earlier boom times.
All of the predicted figures for Connecticut are weaker than those of the rest of New England and well below that of the nation.  But Connecticut doesn’t need fast growth, some experts say, because it’s adding population more slowly.
Deak, in fact, predicts that the total number of people working or actively looking for work — the labor force — will rise by about 20,000 people over the next three years, which would be good for job totals but would temper the decline in the jobless rate.
The best year upcoming is clearly 2015 in the forecast, as job totals return to a semblance of boom times and home construction reaches 8,500 new units, from a 2011 low of 3,000.  But the job totals won’t return to the pre-recession high of 1,713,000 until mid-2016, and the home construction levels will not return to their 2005 peak of 11,000, let alone the heady buildups of the 1980s.
As decent as the numbers look in 2014 and 2015 — both years well north of 1 percent job gains — Deak pulled them back from much higher baseline forecasts for Connecticut by Moody’s Analytics.  Under the New England Economic Partnership model, Moody’s projects numbers for each state based on the U.S. economy, and the state managers adjust based on local conditions.
Moody’s forecast gains of 25,000 jobs in 2014 and a wild and crazy 35,000 for 2015 before Deak made his adjustments.
All of this crystal ball stuff is just that, as Deak and the partnership turned out to be way off last year, when they predicted a disaster resulting from the sequester.  But barring unforeseen events, the direction of things seems clear: The 2014 economy might help Gov. Dannel P. Malloy in his re-election effort, and if he can win, he’ll be able to claim credit for more gains in 2015.

Sandy’s CT Tally: $505 Million In Federal Aid, And Counting; Damage Over $1B

by Categorized: Government, Housing, Public finance Date:

Connecticut sustained damages from storm Sandy totaling at least $1 billion, a total that includes direct public and private losses but not the economic effects of lost work due to the power outages.

And to help compensate, the federal government has kicked in $505 million so far, including $65 million in a second round of housing repair money that Gov. Dannel P. Malloy and federal officials announced Monday.

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A Year Later, Homeowners’ Relief Centers To Offer Sandy Aid

by Categorized: Government, Housing, Public finance Date:

We’re coming up on the anniversary of storm Sandy but the government is not done handing out aid to hard-hit homeowners. On the contrary, the state is opening four relief centers Thursday, to deliver a new cache of $30 million in federal aid to Sandy victims and their neighbors.

The “Owner Occupied Rehabilitation and Reconstruction intake centers” in East Haven, Fairfield, Milford and Norwalk will offer grants from $10,000 to $150,000 for repairs and for upgrades of damaged homes to gird against future storms.

Silver Sands Beach in Milford after Sandy. Michael McAndrews/The Hartford Courant

Silver Sands Beach in Milford after Sandy.
Michael McAndrews/The Hartford Courant

Money is available for residents of Fairfield, New London, New Haven, and Middlesex counties and the Mashantucket Pequot tribal area, the office of Gov. Dannel P. Malloy said in a release.

The money is for costs that were not eligible and covered by flood insurance, the Federal Emergency Management Agency or other sources. It’s part of a $72 million Community Development Block Grant from the U.S. Department of Housing and Urban Development “to address the critical needs of residents, businesses, and communities affected by Sandy.”

Residents can also apply online. Click here for the link.

Separately, the state set aside $26 million for multifamily homes, which are also eligible for repair work.

Preference will be given to low- and moderate-income families, and for now, the money will cover repairs that have not been done yet, said Evonne Klein, the state Department of Housing commissioner.  The grants are open to homeowners seeking reimbursement for work that’s already been done but the department has not yet determined whether reimbursement money will be available, she said.

Following are the addresses. Centers are open weekdays starting Thursday from 9 a.m. to 7 p.m. and Saturdays from 9 3:30 p.m.  Homeowners may call 1-866-272-1976 Monday through Saturday from 8 a.m. to 10 p.m. to make appointments or for information.

  • EAST HAVEN — 52 South End Rd. Unit A
  • FAIRFIELD — Fairfield Senior Center, 100 Mona Terr.
  • MILFORD — Parson Government Center, 70 West River St.
  • NORWALK — Old fire department, 100 Fairfield Ave.



Connecticut’s Tally From Huge Mortgage Bank Settlement: $448 Million For 6,260 Homeowners

by Categorized: Banking, Housing, Real Estate, Wall Street Date:

A preliminary tally is in for Connecticut’s take in the $25 billion foreclosure settlement with the nation’s five largest mortgage loan servicers: $448 million in loan restructuring for 6,260 borrowers, Attorney General George Jepsen said Thursday.

That’s an average of $71,618 that the homeowners won’t have to pay those banks, and they saw their mortgage interest rates fall by an average of 2 1/4 percentage points. On top of it, the state received $27 million for foreclosure prevention programs and 5,000 Connecticut residents who had already lost their homes to foreclosure received $7 million.

The February, 2012 settlement with Bank of America, Citigroup, Ally Financial, J.P. Morgan Chase Bank and Wells Fargo followed an investigation into abusive practices.

“The settlement has been a tremendous success in Connecticut, helping many distressed borrowers to keep their homes,” Jepsen said in a written statement.

“It was the goal we envisioned during long months of negotiations,” said Jepsen, who helped in the talks between the lenders, the federal government and 49 states.

Loan modifications and workouts continue but appear to be winding down as the banks reach their settlement targets. Nationally, nearly 644,000 borrowers have received $51 billion in mortgage relief, with an average benefit of $79,742.



Housing Affordability: Worse for Renters, Better for Buyers

by Categorized: Housing Date:

Falling house prices and crazy-low interest rates have put home-buying in reach of more people, but renters continue to suffer as the supply of apartments shrinks and median wages fall, a report Tuesday shows.

The so-called housing wage, the hourly pay a household would have to make in order to afford a typical 2-bedroom apartment, rose to $23.58 in 2011, from $23.37 a year earlier, the Hartford-based Partnership for Strong Communities said.

That’s about $49,000 a year in income, and it assumes the apartment is $1,225 a month, since housing is considered affordable if it costs less than 30 percent of a household’s income.

That increase in the housing wage is less than in several recent years; the figure was $13.94, or $29,000, in 2004.

And the state –last in the nation in housing construction in 2011 and over the last decade — is short of the number of low-cost or subsidized apartments that are available, by 82,000, the report said.

In 2011, 52 percent of the state’s 436,538 households that rented in 2011 paid more than 30 percent of their income for their apartments or houses, up slightly from 51 percent a year earlier. Among all renters, 26 percent, or 114,891, made less than 50 percent of the state’s median income and paid more than 50 percent of their income in rent.

The percent of people who rent in Connecticut has risen over the last few years as some are unable to qualify for home mortgages and some have chosen to rent because house prices are falling.

Those falling prices, combined with historically low mortgage interest rates, have led to a decline in the number of towns in which a household at the statewide median in pay cannot qualify for a mortgage at the local median price. In 2011, there were 88 such towns, down from 112 in 201o.

The most affordable towns by that measure were, in order, Waterbury, Bridgeport, New Britain, Norwich and Windham — indicating a shortage of houses in Hartford and New Haven. The least affordable were Greenwich, New Canaan, Darien, Westport and Wilton, according to the Partnership’s companion study on towns.

The Partnership’s annual affordability report has been grim in recent years but comes with some notes of hope this year. Gov. Dannel P. Malloy has allocated $300 million for low- and moderate-cost housing and $200 million for subsidies and other supportive programs.

And, the reports note, there has been a significant uptick in the number of construction permits for multi-family housing in Connecticut.

The danger in this state is that rising interest rates and inflation, which are dictated by national trends, will happen before the state’s economy recovers, leaving Connecticut in a further squeeze.

As it is, the report said, 55 percent of real estate agents reported rising rents in August of this year, compared with 39 percent at the end of 2010.