Connecticut Teardowns Are Back: Housing Bubble?

"The crashing sound of Connecticut homes is making a comeback," blared a recent article in the Wall Street Journal. The much-maligned practice of tearing down older, smaller homes to make way for new, larger McMansions was most popular two or three years ago in the upscale communities of affluent Fairfield County, Conn. -- before credit default swaps and foreclosures became headlines.

Often, older properties were purchased by developers who then erected flashy new homes to sell at three or four times the price of the original. Some critics at the time pointed to the practice as evidence of a rapidly inflating housing bubble.

But these days, home prices in Fairfield County are down about 30 percent from their peak in 2007. And if the uptick in the Teardown of the Day postings on news site WestportNow.com are any indication: The desire and ability to buy a modest split-level in an upscale town, and build your version of the American dream, is alive and well and living in Fairfield County.

Is the era of the teardown back? And if so, what does it mean for home buyers?