A Look at the Rental Market. Good News for Investors.

With all eyes turned on the real estate sales market, I decided to take a look at the rental market and how it stacked up. Typically, when sales and prices take a downturn, rentals pick up. However, after analyzing the data to date this year, the results are very surprising.

Regarding residential sales year to date, our average price is $2,299,955 up 17.7% from $1,954,116 during the same time period last year. There have been 235 closed sales to date this year versus 222 closed sales last year. Because there have been 17 high end sales over 5 million this year and 4 more that are under contract, I then looked at sales under 4 million. The average price of homes under 4 million to date this year is $1,857,810 up 5.8% from $1,756,432 during the same time period last year. Also of interest is that the same number of properties under 4 million, 209, closed as of this date in both years

The rental market is really surprising. Of the 142 rentals in 2007, the average rental price is $4,110. There were 140 rentals in 2006 and the average rental price was $3,342. This represents an increase of $768 or a 23% increase in rental rates. Obviously, the number of rentals in New Canaan remain fairly even because the amount of rental properties do not increase or decrease very much and remain fairly constant. However, the increase in the average price is very noticeable as well as the increase in the median price, up from $2800 last year to $3200 this year. Rental prices have significantly increased. This is good news for investors and anyone who is considering purchasing investment properties in New Canaan in the near future.