Rose Ciardiello, a real estate agent for William Raveis, recently listed a Guilford home for $200,000 more than the owners purchased it for just a few years ago.
Within hours, offers came in well over the $975,000 asking price, she said.
Ciardiello said people moving to the area are driving up the asking price, and often making cash offers.
“It’s a crazy market,” she said.
Ciardiello, who primarily sells homes in Madison and Guilford, has called this the “COVID market.”
Houses in the shoreline area are selling fast, according to local real estate agents who say inventory remains low.
“2020 was a very strong year for Connecticut,” Ciardiello said. “Certainly, the shoreline saw an influx of out-of-town and out-of-state buyers. 2021 is proving to be just as strong.”
Ciardiello said houses are selling for 26 percent more per square foot than they were a year ago. When the pandemic started, she said, there were a few weeks where real estate agents were not showing houses as the industry tried to adjust to the situation.
“We were deemed essential,” she said. “So, those of us that were comfortable going out ... were doing that.”
That, Ciardiello said, is when residents of New York City and other major metropolitan areas began to buy up houses in the shoreline area, opting to move to less populated areas that were seeing large day-over-day increases in coronavirus cases.
“Basically, they originally took up all the rentals,” she said. “Then they started buying the lower-end homes. Then they started buying very expensive homes. We’re still seeing, not only New Yorker, but I’m getting folks from New Jersey, Pennsylvania, the West Coast.”
David Platt, who closed on a home in Essex in July, said the move came as the result of a pandemic, but added his family ended up finding a great community.
“In a time that makes you appreciate that life is too short, this has been one of the best decisions we’ve ever made,” he said. “Connecticut has been a silver lining.”
Platt said his family kept their home in New York City, and will return there at some point, but noted they will keep the Essex home for life.
Old Saybrook First Selectman Carl Fortuna said the buying spree that towns in the shoreline area are seeing is long overdue. He said his town’s schools, businesses and recreation make it an attractive community to start a family.
Early in the pandemic, Ciardiello said, she was getting calls from people from New York who were bypassing Fairfield County because they felt it was too close to the city.
“It was a direct correlation to COVID,” she said. “Even now, it’s still related to that because people are working from home. They are working remotely and seeing that they don’t have to be driving in to the office.”
Ciardiello noted that a lot of the things New York City is known for, theaters, restaurants and shops, as well as schools, were closed. She noted that it was not just properties on the water that are selling, but also homes in the north end of Guilford and Madison.
“The idea of having this bucolic lot and yard and privacy and trees is appealing to these folks, because that’s what they are looking for,” she said. “They just want to be away from the city and have privacy.”
Ciardiello said her colleagues around the state are seeing the same phenomenon. She said towns that used to be slow housing markets, such as Essex and the Lymes, have picked up considerably.
The majority of her sellers, she said, are staying in town in smaller houses — especially in homes they already owned, but rented out. She said inventory has stayed low.
“For instance, Guilford was running low before COVID,” she said. “We were doing really well. Madison has a lull for a bit, but are now selling on par.”
Now, she said, houses are going under contract within hours.
“Multiple bid situations — way over asking price,” Ciardiello said. “Houses are selling way over market value. Sometimes houses are listed competitively because you want to encourage a bidding war. But even houses that are listed high are still going well over asking price.”
Colette Harron, a real estate agent for William Pitt and Julia B. Fee Sotheby’s International Realty, sells homes through the shoreline area, but especially in Essex, Old Saybrook, Lyme and Old Lyme.
“The prices are up,” she said. “I don’t know if they’re going to keep on going up, because I can’t predict the future. But definitely prices are up about 20 percent from two years ago.”
Harron said demand is really strong for mid-range homes — with prices below $1 million. She noted that inventory is low in all of her towns.
Like Ciardello, Harron said buyers tell her they want to get out of urban areas during the pandemic. She has seen buyers from New York, California, Boston, among other places, and noted that many of them have children in colleges in the Northeast.
“They like to be between New York and Boston,” she said. “At the same time, you have the charm and the peacefulness of these small towns.”
Harron said the average home she puts on the market costs between $500,000 and $1.5 million, with the ones on the lower end flying off the market.
“You’ve got to be a cash buyer if you want to get the house,” she said, later adding that people are also trying to put as big a down payment as possible to secure the purchase.
Harron said she knows a driving factor for buyers moving to the area is the pandemic, “because we’ve been here forever, and (the market) has never been like this.”
“I haven’t seen it like this since 2004, when it was the height of the market,” she said.
Harron said the market was on the rise then in part because people wanted to get out of cities after the 9/11 terrorist attacks.
Harron said a colleague recently put a house on the market for $495,000 and it sold for $600,000. She said a former client bought a house five years ago for $800,000, and recently put it on the market for $1.2 million.
“He had multiple offers in one day. The first day he put it on the market. I’ve been doing it for 20 years,” she said. “I’ve never seen it like this.”
Harron said the housing market doing so well is giving the area a boost. She said all the stores on Main Street and North Main Street in Essex have been rented.
“Our stores, two years ago, were pretty much empty,” she said. “It’s very nice.”
David Platt, the chief strategy officer at Moody’s Corporation, and his wife Ellen, a homemaker and former child psychologist, said they have lived in New York City for 20 years. They own a home in the Upper East Side.
As the pandemic took hold in the city, David said, he and his two children were all in their apartment on Zoom calls. When summer came, there were no extracurricular activities for the family to do.
“It’s just bleak,” he said.
David said he and his wife were “never the second home crowd.” He said the family went to rent a house, but did not like it because it was in the middle of nowhere and overpriced.
David said he decided to buy a home.
“Life is too short,” he said. “Especially in a pandemic, life is too short.”
With their daughter about to go to college in Boston, David said he began looking for houses.
“Frankly, what happened is that a good friend of mine told me about a house in Haddam,” he said. “I was like, ‘Where’s Haddam?”
David said when they went to explore Haddam, they stumbled upon the shoreline.
“There’s vineyards. There’s ocean. There’s river. There’s fishing. There’s farming markets, and the people are just awesome,” he said. “Everyone we met was nicer than the next.”
The Platts described a competitive housing market, with high prices and bidding wars.
Eventually, the Platts settled on an “awesome” house on South Main Street in Essex. David said they agreed on the price quickly and with no contingencies.
“I said, “I will be ready to close when you are ready,”’ he said and they closed on the house July 17.
Ellen said they have not regretted the decision.
“It let our kids be outdoors,” Ellen said. “But, also, just the family time we’ve had here. We just love this area. We are always exploring. It just changed our whole thinking and gave us a different perspective on family and time together.”
Ellen said it has been the bright spot of the pandemic.
They said they have gone back and forth to New York when needed. David said they plan to spend as much time as possible in their Essex home for the rest of their lives.
“This will be a house for our family and for our future generations,” Ellen said.
In Old Saybrook, Fortuna said the pandemic has really awoken the housing market in his town and surrounding communities.
“It’s unfortunate that some of the people are getting priced out,” the first selectman said, noting that Old Saybrook is working on an affordable housing plan. “But, for those who are selling, I’m happy for people who are seeing their houses valued highly.”
Fortuna said the market in the area had not been good for a long time. He said he is also happy for people who are discovering Old Saybrook, and the broader region, for the first time.
Fortuna said he met a couple from New York that bought a house farther up the Connecticut River, felt they were “too much in the boondocks” and moved to Old Saybrook.
“It has a lot to offer,” he said. “It has a little bit more commerce than surrounding towns.”
Fortuna said Old Saybrook has anything a homeowner could want, noting a person can live on a quiet street, but go to the store within two minutes. He also said the town has a lot of places to walk, cycle and swim, as well as fair tax prices.
“When I moved here in 1994, it took me a few years to fully appreciate where we live,” he said. “Having the Connecticut River and Long Island Sound accessible is just one of the most remarkable features not only for this area, but in New England and the United States. I think more and more people are realizing that.”
Fortuna said Connecticut’s high cost of living, without a lot of high paying jobs, has previously kept people from moving here. He said he is worried about the state legislature driving that cost up even more.
“Hopefully, we are getting more people in the area that have families,” he said.
Fortuna said with more people working from home, he expects the influx of new residents to continue since less employees will need to live close to their jobs.
But Fortuna said the state of the housing market will not change how the town functions.
“It’s not changing the dynamics of the school system,” he said. “In some ways, we wish it would, because we need kids. A large chunk of Connecticut is losing its school-age population. We keep (seeing a) declining school-age population.”
As for the tax base, Fortuna said the town will only see a benefit if the prices remain higher into the next revaluation in 2023.
“Time will tell,” he said. “Right now, we welcome all comers. It’s a great town and I have no problem sharing it.”