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Falling prices fueled home sales

By Lee Howard

Publication: The Day

Published January 17. 2010 4:00AM   Updated January 17. 2010 7:20AM

While most towns in the region rode a rollercoaster year in real estate to a fairly sedate finish in 2009, two of the area's most distressed cities saw eye-opening increases in sales.

Statistics released last week by the Norwich-based Eastern Connecticut Association of Realtors showed that single-family home sales in New London increased more than 30 percent last year over the numbers posted in 2008, while Norwich figures zoomed up more than 20 percent.

But the increasing sales came with a downside: lower median values. In Norwich, the median single-family sale fell to $165,000 last year compared with nearly $180,000 the year before; in New London, prices fell more than $25,000, to a median of $154,650.

Analysts said both the increasing sales and the declining prices reflected buyers taking advantage of a rise in foreclosures and bank-owned properties, as well as the effect of distressed properties on the neighborhoods in which they have occurred.

"It's driven by the facts that the properties are affordable," said Les Bray, an agent for William Pitt Sotheby's in Stonington.

Analysts added that the increase of sales is a good sign, because it shows that distressed properties are being snapped up more quickly than in the previous year, possibly shortening the recovery time for local real estate, which has been mired in a two-year recession.

"I think we're looking at a trend," said John Bolduc, executive officer of the local Realtors association. "It doesn't look like Connecticut is overwhelmed for the future with foreclosures."

Along with two of the region's cities, other towns with healthy increases in sales included Lisbon, whose transactions more than doubled; North Stonington, up 27 percent; Montville, up 23 percent, and Griswold, up 17 percent.

Bozrah, Lebanon, Lyme and Waterford were among the few communities in the area showing slower sales. But Stonington, with a sales drop of 12 percent, was the only town with significant numbers of transactions that saw a reduction of sales in the double-digits.

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