Data from the Mortgage Bankers Association “shows a widening gap between the rate on so-called conforming mortgages ($417,000 or less) and jumbo mortgages (those above $417,000),” reported MSN Real Estate. The gap in the latest round of findings was five basis points and while that may not seem like much of a jump, Southeastern CT homebuyers may be surprised to note the numbers from six months and even one year ago. Six months ago, jumbo mortgages were more expensive than conforming loans by 15 basis points and one year ago, they were more expensive by a whopping 48 points.
These homes have been more expensive as a whole, over time, because of the higher risk and the sheer amount of fees involved. But as you can see, this trend has reversed in the last few months and great news for luxury real estate in Mystic, Niantic, Old Saybrook, East Lyme— many real estate economists have predicted an increase in this area of local real estate and even proclaimed that demand for luxury homes in back!
In December and January, a characteristic winter lull in real estate, many real estate economists saw demand and sales actually increase— with these jumbo mortgages seeing a rise and larger, luxury homes go under contract. According to the Washington Post, “houses in [these upper price ranges] have returned to the market, and prospective buyers are more ready and able to snag them.”
“The main thing is that everyone is just comfortable in the housing market given the consistent gains we’ve seen in the past 24 months,” said one real estate intelligence expert. “Buyers are gaining more confidence in the market and more homes in the luxury segment have more equity in them today.”
In fact, nationwide data for the sales volume of luxury homes on the market, including waterfront and oceanfront homes in Southeastern CT, shows that the current number are almost 14 percent higher than one year ago. And in our area of the country, the sales volume of luxury real estate is up so much as 23 percent from levels just one year ago.
It’s a great time to buy luxury real estate in Connecticut, with more homebuyers now interested in doing so and now able to afford the properties much easier than six months to one year ago. Are you on the search for your dream home— perhaps with the popular features luxury homebuyers are looking for like a master suite or updated kitchen? The Sullivan Real Estate Group can help you choose from the homes for sale in Southeastern CT and walk you through the entire real estate process. Contact us today!