May 7 Connecticut housing conference offers glimpse into the future (Released: 4/29/97)
by Richard Veilleux, Office of University Communications.STORRS, Conn. -- The three most important considerations in the housing market may be location, location, location. But for speculators and real estate professionals looking toward careers at the turn of the century, three new realities bear watching.
John Tuccillo, chief economist for the National Association of Realtors, still won't discount the importance of location in buying homes, but his outlook for the next 10-20 years emphasizes the changing face of the home-buying public rather than where people are headed. Tuccillo's top three include the emergence of the over 55-year-old market; the influx of immigrants into America; and the changing make-up of the American household.
All of which may leave a lot of baby boomers with property on their hands.
Tuccillo will discuss his predictions May 7 during the 1997 Connecticut Housing Conference. sponsored by the University of Connecticut's Center for Real Estate and Urban Economic Studies (CREUES). The event, from 11 a.m. - 5 p.m., showcases experts in housing price and construction trends, financing trends and issues, and legal issues related to new laws affecting the state's housing market, including a panel discussion of recently implemented lead paint laws. The conference will be held at the Four Points Hotel, just off I-84 in Waterbury.
"Marginal homes among the popular styles -- four bedrooms, a center hallway... suburban Colonials -- will be under some (price) pressure as the number of boomers leaving outstrip the number of those looking to move in," Tuccillo says.
Tuccillo, who will deliver the day's keynote address at 12:30 p.m., says the emerging markets he sees portend dramatic changes in the nation's housing stock.
"The emergence of the over-55 market, the boomers, is creating a market not of first-time home-buyers, but last-time home-buyers," Tuccillo says. "They're going to be looking for low-maintenance, high-comfort homes. Everything from condominiums right up to 'smart houses.'
Immigrants, he says, will become the new first-time buyers. The third emerging market, the changing household, is evolving now.
"There are fewer nuclear families. Today's household features everything from singles to sandwich generation couples to blended homes. It suggests a different type of housing. You'll start seeing homes built, for instance, with two master bedrooms," Tuccillo says.
Another speaker, John Clapp, a finance professor and housing specialist in UConn's School of Business Administration who closely tracks prices in about 50 of the state's larger communities, says Connecticut housing prices hit bottom in the fourth quarter of 1994. That ended a slide that began in late 1988 and has cost the state's homeowners, on average, about 25 percent of the value of their homes. Since bottoming out, he says, prices have stayed relatively flat, except for Fairfield County, where prices have increased.
"We need a white knight. A large corporation to move into the central part of the state, or substantial growth in an industry, such as biotechnology," before prices begin trending upward again, he says. "Some good job growth, at least 2.5 percent annually, and a stabilization of the hemorrhaging of jobs from the major firms would help out."
Clapp sees some signs of hope. He says there is evidence that the job and housing boom in lower Fairfield County has moved into the Naugatuck Valley area, and there is a good volume of small business start-ups and expansion across the state. But, he says, Connecticut needs more of that growth in the middle of the state -- New Britain, Hartford, New Haven -- before housing prices can appreciate considerably.