Just as the residential sales market starts to cool down, there is news that the rental market, always tight in many parts of the State, is continuing to boom beyond expectations. New Haven leads the pack, with major new developments outpacing occupancy projections. The first two phases of the Audubon project are gone, with a third phase being added, to accommodate interest in townhouse-style living. The large new development in Wooster Square reports that units are moving quickly, and that there is sharp interest in a new "add-on" smaller unit. Observers have long wondered how the demand has stayed so strong. It's likely that the huge student population makes a big difference. In the past, they have not had the kind of choices that they are enjoying now, so they stayed more often in dorms, or took apartments in multi-family homes. Foreign students also can rent properties sight unseen, so big complexes are easier, in terms of leasing and paperwork. Although there must be some ceiling, the availability of remote work means that more and more people can rent wherever they'd like to live. Since New Haven is commutable to NYC and to Hartford and even Boston, on a partial basis, its vibrant arts and dining scene and nightlife make it especially attractive to young professionals and empty nesters alike.
Hartford is also seeing a lot of new building, and it had less to begin with, so whatever market there is will be happy with the new options. Several major developers have broken ground with additional units, and that is helping entertainment and restaurants to prosper in the evening. That is somewhat tougher than for New Haven, since many of the office workers in Hartford have not returned. As they do, or as more renters appear, it can become more of a center for lively living.
Fairfield County has long been home to commuters, but the push toward remote work has made its location more feasible for those working in the financial district of New York, as well as in other suburbs. Younger commuters can afford nicer apartments, with more outdoor space, than in the City, and COVID has accelerated the trend. Surprisingly, rental rates in Stamford are only marginally higher than in the newer developments in New Haven. In both cities, easy access to train service helps to tip the balance toward Connecticut living.
What will all this mean for employers and commercial real estate owners?
People gravitate toward places that they want to live, and are increasingly choosing a location before a job. Connecticut is well positioned to do well in the commercial sector, as jobs move closer to employees, as opposed to vice versa, as was true in the past. And the rest of us? We will all benefit from stronger cities. Suburbs are exactly that--sub-urban areas, that depend upon a viable core. All signs point to go!