Buying A House In Connecticut: Where, When, Why And How

As a piece of historic New England filled with coastal cities and small towns alike, Connecticut has a little something for everyone. Whether you’re a history enthusiast or just looking to enjoy the four seasons along the coast, Connecticut can be a great place to live year-round.

If you’re thinking of moving to Connecticut, take a dive into what you might need to know about moving to this beautiful East Coast state, including housing market trends and the typical home buying process.

Why Buy A House In Connecticut (CT)?

Connecticut has a population of around 3.5 million and is growing rapidly, thanks to the urban exodus of the COVID-19 pandemic, which attracted many former New Yorkers to the coastal state.

It’s also a well-educated state, filled with universities – including Yale. According to U.S. Census data, 40% of Connecticut’s population has a bachelor’s degree or higher level of education, which exceeds the U.S. average of 33% – which might be good news if you’re interested in academia or looking for a high-quality school district.

Connecticut is also home to beautiful scenery, including forests, mountains and, of course, views of the ocean. While it’s a fairly small state, it faces New York’s Long Island and is within a short drive or train ride to New York City and other popular northeastern destinations.

When To Buy A House In CT

Aside from the appeal of four seasons, coastal property and abundant historical sites, real estate in Connecticut can be a solid investment. It’s currently still a strong seller’s market, meaning there are more buyers than houses available. But interest rates are predicted to climb higher, so now could be a great time to buy, albeit quite competitive. Home values have also stayed steady or grown in some areas.

If you’re interested in buying a home in Connecticut but are concerned about competition or home listing prices being beyond your price range, talk to a real estate professional. Working with a real estate agent or REALTOR® can be very beneficial, as they often know the local area and will be able to find something for you within your budget.

If you have more questions about buying a home during this wild time in real estate history, check out our guide to buying a house right now.

What Do You Need To Buy A House In Connecticut?

To buy a house in Connecticut, you’ll need all the same things you might need to think about anywhere else. Some things you might consider are:

• Good credit: A good credit score can land you a better loan with a lower interest rate. Many lenders, depending on the loan, require you to have a credit score of at least 580, but scores 740 and higher will typically land you the best rates.
• Low debt-to-income ratio: To qualify for a loan, lenders prefer you have a low debt-to-income ratio (DTI). Typically, you’ll need to have a DTI of 50% or less, though it varies based on the loan.
• Financial documentation: When applying for a home loan, you’ll want to make sure you have any financial documentation that might be needed, including tax returns, pay stubs, gift letters, bank statements, etc.
• A qualified, local real estate agent or REALTOR®: A trusted real estate agent can help you get the best deal possible and will negotiate on your behalf. They also tend to know the areas they work in well and can offer you their expertise.
• A home appraisal: Getting a home appraisal done for any property you’re seriously interested in is vital. Many lenders won’t lend you the money for your mortgage if the house is appraised far under the sale value or loan amount, so it’s important to have this done.
• Down payment: A strong down payment can make your offer on a house more appealing to the seller and it reduces your mortgage loan balance, of course. If you put enough down on a conventional loan, you can even avoid paying private mortgage insurance (PMI).
• Savings for closing costs: Closing costs typically run home buyers 3% – 6% of the loan amount. That means closing costs are typically a few thousand dollars, which is a bill you’ll want to be prepared for.

Connecticut Homeownership Assistance Programs

There are many programs intended to help certain home buyers, including first-time home buyers, available across the U.S. These include VA loans, FHA loans and USDA loans. The Connecticut Housing Finance Authority (CHFA) also offers a few specific programs for individuals buying homes in Connecticut, including the following.

HFA loan programs are offered by Freddie Mac and Fannie Mae to Housing Finance Agencies like the CHFA to serve low-income borrowers. To qualify, you’ll need to be a first-time home buyer (having not owned a home in at least 3 years), and your qualifying gross income must not be greater than 80% of the FNMA/FHLMC area median income limit for the county where the property is located. For more information, check out the CHFA’s website.

The home buyer mortgage program is also offered by CHFA. This program boasts low interest rates and potential down payment assistance. To qualify for this program, you’ll once again need to be a first-time home buyer, and the property you’re purchasing must be intended to serve as your primary residence. Depending on your financial situation, you might be eligible for up to $3,000 of down payment or closing cost assistance. For more information on this program and its requirements, check out the CHFA’s website.

CHFA also offers down payment assistance program (DPA) loans, which are essentially second mortgages on your house intended to finance a down payment and closing costs up to $20,000. For more information on DPA loans and whether they might be right for you, check out CHFA’s page about them.

For more information on the ins and outs of DPA loans and down payment assistance in general, you might also check out our guide to down payment assistance and how to qualify.

Top 5 Real Estate Cities In Connecticut

If you’re ready to take the leap and find a new home, we’ve put together a list of five great cities and neighborhoods in Connecticut to help you decide where to live.

Bridgeport

Bridgeport is the largest city in Connecticut. This seaport city is full of historic charm and boasts a lovely downtown area with old buildings and plenty for visitors and residents alike to do. If you like museums, history or just enjoying ocean views, Bridgeport is the perfect city for you. It has a population of 144,399 and the median home listing price was $299,900 as of June 2021.

Bridgeport Real Estate Listings

Bridgeport Trend Report

Bristol

Bristol is a suburban city that you might recognize as the home of ESPN’s studio headquarters. The city is also home to the oldest still-operating theme park in the U.S., Lake Compounce, which opened for the first time in 1846. This city is full of unique scenery and has plenty for any resident to do. Its population is 59,947 and the median home listing price is $244,900.

Bristol Real Estate Listings

Bristol Trend Report

Hartford

Hartford is Connecticut’s capital city and the fourth-largest city in the state. It was founded in 1635, making it one of the oldest cities in the United States. Hartford County is also full of rich history, plenty of parks and interesting landmarks such as the Mark Twain House. Hartford has a population of 122,105 and a median sold price of $229,900.

Hartford Real Estate Listings

Hartford Trend Report

New Haven

New Haven is a coastal city best known for being the home of Yale University. It’s one of the oldest and first planned cities in the United States and is rich in colonial history. It’s the second-largest city in Connecticut and is popular for its many museums, theaters and music venues. New Haven has a population of 130,250 and the median home listing price is $279,900. 

New Haven Real Estate Listings

New Haven Trend Report

Stamford

Stamford is the third-largest city in Connecticut and sits halfway between Manhattan, New York, and New Haven, Connecticut. It’s home to nine Fortune 500 companies and has a sizable financial district. It’s also home to several colleges and universities, such as the University of Connecticut Stamford. This city has miles of shoreline accessible to the public as well as a few beaches. Stamford has a population of 129,638, and the median sold price is $549,178.

Stamford Real Estate Listings

Stamford Trend Report

The Bottom Line: Houses To Buy In Connecticut Are Plentiful

Connecticut is an east coast state with a little something for almost every homeowner, whether that’s being near New York City at a more affordable price or exploring the rich history and glistening ocean views of Connecticut’s towns.

If you’re dreaming of moving to this scenic northeastern state, you can start browsing through the current homes for sale in Connecticut. If you’re still researching, reach out to a Rocket Homes℠ Verified Partner Agent to take advantage of their local expertise.