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A Tale of Two Counties
UConn study probes disparities between New Haven, Fairfield
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Business New Haven
9/4/2001
By: M.C.B.
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The Connecticut Economy, the University of Connecticut's quarterly economic survey, has undertaken a comprehensive look at New Haven and Fairfield counties and the sharp contrasts in the economic fortunes of residents in both.
Statewide, the median sales price of single-family homes last year ranged from a low of $78,000 in New Haven to $900,000 in New Canaan - an 11-fold disparity between two municipalities less than 40 miles apart. In its analysis the UConn study reports how these widely varying prices reflect many local characteristics, including congested roads and the distance to Wall Street.
Indeed, the study says, controlling for house size and other characteristics, the median sales price drops about 14.1 percent for each ten-percent increase in distance from New York City. (Elsewhere in Connecticut, house prices decline about 9.4 percent for each ten-percent increase in distance from Boston.)
In addition to location, the study says, other factors affecting home prices include neighborhood quality (per-capita income, crime rates - New Haven leads the state in crimes per 1,000 residents, with 97.2 - and road congestion) and local public policies (educational spending, property tax rates and zoning - minimum lot sizes range from zero in New Haven up to five acres in some Fairfield County towns).
The study also examines links between location, transportation and home prices. Congestion, it notes, raises travel costs, thus enhancing the value of a shorter commute. Stamford's growing importance as a major employment center, coupled with rising congestion and skyrocketing property values, may influence workers to sacrifice commute time in favor of cheaper housing. And because “There are many more 'bargain' towns in New Haven County than in Fairfield County, we probably should expect wider housing searches and longer commutes, extending Fairfield County's congestion problems to other parts of the state,” says the study.
In addition, the study notes how road congestion impairs neighborhood quality and reduces property values. This keeps housing more affordable in congested areas. But the study concludes that this effect is “modest and unlikely to halt the spread of southwest Connecticut's twin problems - costly homes and crowded roads.”
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