New Yorkers Leave the City and Drive Up Housing Prices
New York City residents have been fleeing the metropolis in record numbers since COVID-19 was declared to be a pandemic in March 2020. This has resulted in housing prices soaring in the suburbs and even in outlying areas located in Connecticut, New Jersey and Pennsylvania. Home prices that had already been high in those areas soared even more thanks to the competition, scarcity and higher incomes of New York City's residents.
One Man's Experience Trying to Buy a Home in Connecticut
A single father in Stamford, Connecticut, was approved for a $300,000 mortgage loan. With the pre-approval in hand, he started looking at houses in early 2020. then the COVID-19 pandemic arrived. His once high hopes for finding an affordable home quickly vanished. By the end of 2020, he was still renting an apartment with his three-year-old child. He was unable to find a two- or three-bedroom home in Stamford within his price range. He kept getting out-bid by people who could afford a higher monthly mortgage payment. This man has a full-time job as the head of security at a government building and a part-time job as a security guard.
Where the New Yorkers Are Going
New Yorkers are leaving the city and relocating to Fairfield County, CT, among other places. It's on the border with the state of New York. The influx of people has been celebrated by Connecticut's politicians who look forward to more tax dollars from the new residents. However, for Connecticut's existing residents, the influx has led to a lot of new problems. For low- to middle-income individuals and families, the new residents are more competitive in an already tight housing market. Housing costs were already much higher than average in Fairfield County, and many people are being priced out of the home market and the rental market.
Characteristics of the New Residents
Newcomers to Connecticut from New York are buying homes quickly. They're paying cash for those homes. Many of them aren't asking the sellers to fix anything, and the sales close quickly. This is worsening the shortage of available homes. It also exacerbates housing insecurity and inequity of income.
Fairfield County's Housing Shortage Gets Worse
The shortage of affordable housing in Fairfield County is getting worse, according to a report released on January 18, 2021. By late December 2020, there were only five single-family homes for sale priced at less than $400,000 in Stamford. The city of Stamford's housing prices are lower than the rest of Fairfield County. People are getting outbid on multiple homes. For the people leaving New York City, Stamford's prices look like a big bargain.
Why People Are Relocating to Smaller Communities
Urban residents left cities in record numbers in 2020. Some left for suburbs, while others left for small towns or rural areas. For the first time in three years, Connecticut had more people move into the state than out of it. New York residents were the largest population moving into Connecticut. People are leaving larger cities to get more space. They want yards and bigger homes. Those who are working from home want the space for home offices or remote learning for their children. They also want a calmer life. The lower housing costs are a bonus.
Typical Home Sales Levels for Stamford
In a typical month in Stamford, housing sales usually amount to $80 to $110 million. This changed thanks to COVID-19. Sales in August 2020 were $146 million. In September, $152 million of homes sold. November saw home sales of $157 million. Thomas Madden, who is the Director of Economic Development in Stamford, said that both prices and sales have increased. He added that businesses are also coming to the area. The ability to enjoy a backyard or walk in a safe neighborhood is a big lure to young families.
Call for More Affordable Housing
Stamford's mayor said that more rental options will soon be available in Stamford. Several apartment complexes that were approved before the COVID-19 pandemic began will be finished soon. The city's code requires that a minimum of 10% of all new rental units be set to affordable prices. The mayor added that the city has built more affordable housing units in the past 10 years than any other community in the state. Before the COVID-19 pandemic, 38% of Fairfield County residents reported that their rent or mortgage accounted for at least 50% of their monthly income.
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