People are constantly asking our real estate team, “Why are the prices of real estate continuing to escalate month after month”? Even in Market Updates in the past, where we saw that some of the prices start to slip, it’s actually this month that we saw them start to take back up again surprisingly so. Typically, the price slumped in the state of Connecticut around February and then started to increase in actuality in November of this past month, we saw the real estate prices increase by another one to two percent. So why is this happening?

Since the pandemic hit around February or March of 2020, we saw real estate prices in Connecticut increase dramatically. In fact, it was somewhere in the range between 20 and 27 percent in certain towns throughout the state. 

Why is that? Well, the first reason is because many people decided that they didn’t want other people inside of their houses. So they didn’t list their homes, which created a shortage of houses. We would say that the demand and supply were out of balance and therefore, the prices started to go up. We also saw the Federal Reserve drop their interest rates and their loans to the central bank to zero percent, which means that banks like Wells Fargo could lend to average consumers like myself at a reduced rate, which also increased demand because people are now able to buy more home for less amount of money on their monthly payment.