The reasons for Connecticut’s housing weakness aren’t just local. Homebuyers are holding back because of economic crises brewing thousands of miles away, said Nick Perna, economic advisor to Waterbury, Connecticut-based Webster Bank and lecturer in Economics at Yale University. “For many people in the United States, this whole thing about the Eurozone is an abstraction — some battle between Germans, Italians and Spaniards,” Perna said. “If you live in Connecticut and work in financial services, it’s very real because it could affect your job, your bonus and therefore your ability to afford a nicer home.”
Connecticut, for 25 years the state with the highest per capita income in the U.S., is now leading the nation in home-price declines as Wall Street trims jobs and bonuses that had driven multimillion-dollar property sales. Prices in the Fairfield County area, home of the banker bedroom communities of Greenwich and New Canaan, tumbled 12.9 percent in the second quarter from a year earlier, the biggest decline of the 147 U.S. metropolitan areas measured by the National Association of Realtors. While the number of home purchases within the state financed with conventional mortgages rose 8.4 percent in the first half, deals using jumbo loans for pricier properties slid 9.4 percent, according to Warren Group, a real estate tracker. “We’re in a tough slog here relative to everybody else, which is surprising given where we’re located, near New York and Boston,” said Terence Beatty, director of the new homes and land division of Prudential Connecticut Realty in Wallingford.
By Prashant Gopal and Heather Perlberg, Aug 28, 2012 BB
Greenwich, Ct estate.