How Much Will Your Mortgage Be in Connecticut?
The 3.9 million residents of Connecticut are mainly found in the cities of Bridgeport, New Haven, Hartford, Stamford, and Waterbury. In part because the state offers such pristine views of the Atlantic, homes in Connecticut can be hard to find. The market is quite stable, however.
The median home value of a Connecticut home is $244,800, and home values have been creeping up since 2012. The median listing price in bigger cities such as Stamford is much higher—$549,000 in fact. Part of the cost is due to the fact that Stamford is only a 30-mile drive to New York City.
More affordable housing can be found up the coast in Bridgeport and New Haven where the median listing price is just under $190,000. Surprisingly, the state capital of Hartford is even more affordable, median listing prices there being just $149,900.
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Factors That Can Affect Your Connecticut Mortgage Calculations
CT Property Taxes
It's vitally important to incorporate the property taxes you will need to pay into any mortgage considerations. Cities and towns in Connecticut will set the rates of property taxes and collect them to fund most of the local public services including schools and maintaining infrastructure.
The effective property tax rate in Connecticut is 2.07%, which is higher than the national average.
Your local municipality will determine your home's fair market value at least every five years to arrive at your property tax rate. Following this, your actual tax rate will be 70% of the value of your home. The elderly, disabled, or veteran residents can apply for special tax exemptions depending on what their particular city or town offers.
Connecticut Job Stats to Consider
Insurance and financial services are extremely large industries in Connecticut, accounting for nearly 20% for the state’s Gross State Product. Connecticut is also home to ESPN, NBC Sports Group, and World Wrestling Entertainment, Inc., as well as 15 Fortune 500 companies such as Aetna, Xerox, Priceline Group, and United Technologies. Also to be found in Connecticut are Yale University, Wesleyan, Quinnipiac, and the University of Connecticut.
The per capital personal income in the state is just over $76,000 as of 2018, much higher than the national average of less than $55,000. Connecticut’s unemployment rate was 3.6% in September of 2019, no worse than the national average.
You will be forced to pay closing costs once you sign all outstanding paperwork and receive the keys to your home. These fees will go to your mortgage lender, county and/or state in addition to any other parties involved in the transaction. Closing costs in Connecticut can range from 2.5% to 3.2% of your home's price.
Included in closing costs are origination fees paid to your lender, comprised of underwriting, broker charge points, tax service, document preparation, and commitment fees. Third-party fees will also be paid for appraisals, credit reports, surveys, flood certification, and for any attorneys involved in the process.
Connecticut Job Stats to Consider
As of December 2019, the civilian labor force in Connecticut was 1.9 million and the unemployment rate was 3.7%. The occupations with the highest number of employees in the state are Office and Administrative Support, Sales, and Food Preparation and Serving, which employs greater than 553,000 people.
Job Stats (Civilian Labor Force, Employment, Unemployment)
Other Connecticut Costs That Can Affect Connecticut Mortgage Calculations
Another expense to factor in is homeowners insurance, which is generally incorporated into your escrow account. The state of Connecticut's average premium is $1,490 per annum. The state does experience hurricanes now and then, which accounts in part for the cost. Those in coastal areas should consider adding flood insurance to their policy as it isn’t included in the average homeowner policy.
Get in touch with the Connecticut FAIR Plan if you aren’t able to afford insurance on the voluntary market.
Home Inspections in Connecticut
Home inspections are a one-time expense you should seriously consider during the process of purchasing a home. Even though anyone selling a home in the state is obligated to provide a property disclosure, it’s no substitute for a home inspection which will examine the state of the electrical, plumbing, sewage, and other systems of the home.
A home inspection will cost between $250 and $450 depending on the size of your home, with further termite, mold, or radon testing costing an additional amount.
Another cost you will incur is purchase of title insurance to protect against any financial loss due to future title disputes with undisclosed liens, easements, etc.
Property Title Transfer
Connecticut will also charge you a conveyance fee for transferring your property title. The tax is 0.75% on the first $800,000 of the home; after that, the rate goes up to 1.25%. Further conveyance taxes are assessed at the municipal level at 0.25%; however, cities such as Stamford have a higher rate of 0.35%, and Norwalk is higher still at 0.5%.