Real Estate Market Update Somerset County, NJ Canal Walk

Somerset County’s Real Estate Market Conditions | December of 2017 – Canal Walk Edition

Somerset County’s Real Estate Market Conditions | December of 2017 – Canal Walk Edition

Monthly Market Update Newsletter Banner

Get ahead of the real estate market economic and behavior drivers in Somerset County, New Jersey with Coldwell Banker Residential Broker sales associate, Joe Peters.

Somerset County New Jersey Real Estate Market Conditions (including):

  1. Branchburg
  2. Bridgewater
  3. Somerville
  4. Hillsborough 
  5. Warren
  6. Watchung

Based on the last full month’s contract sales, statistics show a supply of approximately four months. Normal market conditions average four to six months in Somerset County.  Units sold averaged 61 days on the market. 307 properties went “under contract” in November, down from 338 in the prior month. Newly listed properties in the same period totaled 252.

Somerset County Inventory Breakdown by Price | October:

New Listings Under Contract Active Listings Month’s Supply
Condos/Town Houses * 133 132 358 3
Over 55 Communities* 10 19 50 3
$000K to $199K 33 38 91 2
$200K to $299K 81 94 245 3
$300K to $399K 79 64 199 3
$400K to $499K 40 42 153 4
$500K to $599K 31 33 139 4
$600K to $699K 29 22 122 6
$700K to $799K 21 14 98 7
$800K to $899K 10 12 83 7
$900K to $999K 16 6 73 12
$1,000K and Up 49 13 260 20
Totals for October 389 338 1463 4
Average Price $579,975 $436,420 -24.8%  
Average Days on Market 61
* Included in $ breakdowns

Somerset County Sales Breakdown Overview:

  • 70 % of sales in houses < $500,000
  • 26 %of sales in houses > $500,000 and < $1,000,000
  • 04 % percent of total sales (or 13 in total) in houses >$1,000,000

Somerset County Inventory Breakdown by Municipality | November

Somerset County Sales Breakdown Detailed:

Active Listings Under Contract Month’s Supply
Bedminster Twp 72 17 4
Bernards Twp 151 31 5
Bernardsville 88 8 11
Bound Brook 20 6 3
Branchburg Twp 75 12 6
Bridgewater Twp 161 40 4
Far Hills Boro 14 0
Franklin Twp 202 80 3
Green Brook 34 7 5
Hillsborough 123 31 4
Manville Boro 37 6 6
Millstone Boro 2 0
Montgomery Twp 147 20 7
North Plainfield 71 25 3
Peapack Gladstone 30 3 10
Raritan Boro 12 8 2
Rocky Hill Boro 2 1 2
Somerville Boro 32 8 4
South Bound Brook 13 7 2
Warren Twp 125 19 7
Watchung Boro 52 9 6
Totals 1463 338 4

Two areas in Somerset County reported no sales in the past month:

  • Far Hills
  • Millstone

One area reported one or two sales each last month:

  • Rocky Hill

Hotspots:

  • Bernards – 24 sales
  • Bridgewater – 35 sales
  • Franklin – 65 sales
  • Hillsborough – 35 sales
  • Montgomery – 19 sales
  • N Plainfield – 18 sales

These hotspot areas equaled 64% of the sales last month. The average new listing coming on the market last month neared $545,660 The average price of a unit going “under contract” neared $432,561 (21% less).

Note: To get an accurate price point for your property, contact me. Coldwell Banker’s big data technology capabilities will put you at an advantage. Houses priced and marketed accurately sell fast, especially with a real estate industry veteran and local expert helping you navigate the process.

Canal Walk Statistics:

  • Canal Walk offers one floor units, town houses and various models of single family units
  • There are 4 homes currently for sale in Canal Walk as of this writing with an average list price of $481,075.
  • Of the 4, only none is an Enclave single floor unit
  • There was only one new listings this month with an average list price of $494,500.
  • Four units have gone under contract in the past 30 days with an average list price of $428,000 with the average days on the market of 84.
  • Giving us a little over 1 months’ of inventory
  • Close to 50 units changed hands over the past 12 months ranging from the low $300’s in to the low $600’s
  • The actual price per unit varies by type, model, location and upgrades
  • Call for more details…

New Jersey’s Economic Drivers:

New Jersey Home Sales:

Home purchase demand increased by  9% in New Jersey during November giving the state its 6th consecutive month of increases. (These numbers run a month behind).  The same number were about 4% in 2016.

New Jersey experienced a compounded growth rate of 14% over the past two years. Sales increased by 5% YTD.

Activity concentrates in the <$400,000 market where Millennial buyers transition into home ownership. During the same period, all housing sales showed increases across all price points showing confidence in the new administration’s plans on taxes and deregulation.

At the same time, the number of homes offered for sale in New Jersey remained low and had recently decreased. The supply decreased by ~ 5,000 homes, compared to a year ago.  Currently, ~33,000 fewer (-46%) homes are on the market compared to the 2011 peak.

Current unsold inventory in New Jersey sits at just under 4.3 months vs. 5.2 months from a year ago.

Hunterdon County has ~10% less inventory, and Somerset County also has ~ 13% less inventory than a year ago.

The fear of increasing interest rates based on future increases, and the Fed’s slightly loosening lending standards affect the current market activity.

Interest Rates:

Interest rates at the end of November rose slightly to a level of just over 3.9% for a 30-year conventional mortgage. A fifteen-year conventional mortgage rests at just under the 3.3% range. Five and seven-year arms are at the 3.3% range as well.

Consumer fears of steadily rising rates and slowly rising home prices impact the current market. The Fed already instituted initial increases in rates and are talking about additional ones. Industry analysts forecast a 4.7% rate by the end of the year, 5% by the end of 2018, and 5.5% by the end of 2019. If the rate increases from 4% to 5%, buyers will lose 9% of their buying power.

Combine that with the steadily increasing prices and consumer confidence, and you have what is driving our current market activity

National Job Front:

US unemployment rate is 4.1%. This is the lowest it has been in over forty+ years ! And, it is a decline of over 70% from the peak which happened in 2009.

On the national level, we reached full recovery in May of 2014 with 2,700,000+ job gains in 2015. Revised figures show a gain of 2,242,000+ in 2016.  Expectations of 2,000,000 jobs in 2017 leave us at  -6% from 2016.

  • The national U-3 unemployment rate stands at 4.1%.
  • U-6 unemployment rate stands at 7.9%

Note: Due to full-time and part-time jobs counted equally by the BLS, numbers differ.  The US economy still needs to create an additional 2,600,000 jobs to reach the same employment rate that existed before the start of the 2007 to 2009 recession.

But, the momentum is building and the result is consumer confidence is the highest since 2004. Great news for the housing industry !

New Jersey Job Front:

NJ unemployment rate increased to 4.9%, bolstering consumer confidence remains high in NJ as well.

New Jersy job growth increased by 65,000+ in 2015, the best in 15 years. Projecting on those numbers, New Jersey’s recession losses would recover by 2017.  To date, we reached 96% of projected numbers. Finalized projected numbers showed 59,000 in 2016. Still good!  Although we still trail the nation, we’re on pace to add 25,000 jobs this year vs. 59,000 being added in 2016 (- 60%).

Thru October, 22,000 additional jobs were added YTD vs. 50,900 for the same period last year.

It should be noted that even though these numbers are disappointing, the levels of the jobs being added at is much higher than in the past several years (a silver lining?).

Rental Market Trends:

Tight Market!

Prior restrictive mortgage standards nudged Millennials to postpone home ownership until later in life than previously seen. These potential buyers live with parents or share rentals. We are starting to see them now re-enter the rental and first-time buyer markets. The average age of our first-time buyer changed from 29 to 37 years over the past five years.  Older Americans impacted by underfunded retirement plans due to the economic downturn rent houses too.

Rental prices in New Jersey rose ~ 10% annually, averaging over $1,300 per unit. Current vacancy rates in New Jersey rest at 3.5%, the lowest in the state and nation (which is at 4.5%).

The drop in New Jersey’s homeownership contributes to rental demand.  A 12+ year trend shows a decrease from  71% to 52%.  This 8% decrease compared to an 8% national decrease contributes to the slower recovery of home prices in the state.  One or two-person households with no children stands at 65%, reflected in our school population.

New Jersey Foreclosures:

New Jersey continues to face high foreclosure rate filings. Other states have begun to, or already have recovered. In tight real estate market, these foreclosures sell at a small discount.

Note:  Figures vary by local market, especially those walloped by Hurricane Sandy three years ago and rural and urban areas. We still rank #1 in the country at 4.0%, followed by NY, LA, MS, ME, FL, MD, PA, MD, RI and DE.  The national baseline number sits at ~ 1.7%.

2016 saw a 3% decrease over the prior year and added a ~ 71,100 filings, compared to 76,800 in 2015.  2017 YTD  foreclosure filings YTD have decreased sllightly with 2016 YTD.  Forecasts project 72,000+ or -3%, putting pressure home prices in concentrated areas.

 Real Estate Market Recap

  • Consumer confidence is high. This is mainly based on the job and stock market increases.
  • 80% of consumers perceive homeownership as part of the American Dream.
  • Millennials make up 24% of homeowners with room for expansion at the lower end of the market with adequate inventory supply.
  • Analysts five-year forecast indicates slow and steady price growth ay an annual 4%.
  • Central New Jersey’s trend for 2016 and early 2017 showed a surge in home sales, but not prices, clustered in < $500,000 market. In 2016, a 1% rise in prices tallied for New Jersey. As inventory builds, prices will rise.
  • In 2017 prices rose ~ 4% in the more popular price points with ideal locations. Projections for 2017 rest at 5% by the end of the year.  Houses priced <$400,000 for first-time buyers, and Millennials experience greater pricing fluctuations.
  • The >$600K market holds steady to diminishing slightly, depending on location and price.  Often when a >$600K property goes on the market, it’s competing with a >$700K that needs to sell quickly.
  • People in their home > 10 years think about making a change with a healthy economy.  Home equity built up and a more significant portion of payments applies to principle.  Increases in pricing motives people to make changes or even start a new business with the extra equity cash.
  • Minimal new construction adds additional value to the current inventory.
  • Foreclosures help to offset fewer listings.

Somerset County | Canal Walk

Net-Net

Either as a seller or buyer, navigate this real estate market with me!

  • Low-interest rates
  • Pent-up demand
  • Active market with increasing prices in the more popular price points and locations
  • High consumer confidence

Call me at 908-238-0118 to discuss your situation, and I’ll put my expertise and access to big data to work for you.

Note:  Presented as a public service by Joe Peters of Coldwell Banker Residential Brokerage. I took reasonable precautions presenting this information. Please consult with a professional sales agent and take no actions based on my opinions, gathered trends, and statistics.  I assume no liability.

Canal Walk Somerset

Somerset County’s Real Estate Market Conditions – as of November of 2017 – Canal Walk Edition

Somerset County’s Real Estate Market Conditions | November of 2017 | Canal Walk Edition

Monthly Market Update Newsletter Banner

Get ahead of the real estate market economic and behavior drivers in Somerset County, New Jersey with Coldwell Banker Residential Broker sales associate, Joe Peters.

Somerset County New Jersey Real Estate Market Conditions (including):

  1. Branchburg
  2. Bridgewater
  3. Somerville
  4. Hillsborough 
  5. Warren
  6. Watchung

Based on the last full month’s contract sales, statistics show a supply of approximately four months. Normal market conditions average four to six months in Somerset County.  Units sold averaged 61 days on the market. 338 properties went “under contract” in October, down from 340 in the prior month. Newly listed properties in the same period totaled 389.

Somerset County Inventory Breakdown by Price | October:

New Listings Under Contract Active Listings Month’s Supply
Condos/Town Houses * 133 132 358 3
Over 55 Communities* 10 19 50 3
$000K to $199K 33 38 91 2
$200K to $299K 81 94 245 3
$300K to $399K 79 64 199 3
$400K to $499K 40 42 153 4
$500K to $599K 31 33 139 4
$600K to $699K 29 22 122 6
$700K to $799K 21 14 98 7
$800K to $899K 10 12 83 7
$900K to $999K 16 6 73 12
$1,000K and Up 49 13 260 20
Totals for October 389 338 1463 4
Average Price $579,975 $436,420 -24.8%  
Average Days on Market 61
* Included in $ breakdowns

Somerset County Sales Breakdown Overview:

  • 70 % of sales in houses < $500,000
  • 26 %of sales in houses > $500,000 and < $1,000,000
  • 04 % percent of total sales (or 13 in total) in houses >$1,000,000

Somerset County Inventory Breakdown by Municipality | October

Somerset County Sales Breakdown Detailed:

Active Listings Under Contract Month’s Supply
Bedminster Twp 72 17 4
Bernards Twp 151 31 5
Bernardsville 88 8 11
Bound Brook 20 6 3
Branchburg Twp 75 12 6
Bridgewater Twp 161 40 4
Far Hills Boro 14 0
Franklin Twp 202 80 3
Green Brook 34 7 5
Hillsborough 123 31 4
Manville Boro 37 6 6
Millstone Boro 2 0
Montgomery Twp 147 20 7
North Plainfield 71 25 3
Peapack Gladstone 30 3 10
Raritan Boro 12 8 2
Rocky Hill Boro 2 1 2
Somerville Boro 32 8 4
South Bound Brook 13 7 2
Warren Twp 125 19 7
Watchung Boro 52 9 6
Totals 1463 338 4

Two areas in Somerset County reported no sales in the past month:

  • Far Hills
  • Millstone

One area reported one or two sales each last month:

  • Rocky Hill

Hotspots:

  • Bernards – 21 sales
  • Bridgewater – 23 sales
  • Franklin – 25 sales
  • Hillsborough – 23 sales
  • Montgomery – 20 sales
  • N Plainfield – 25 sales

Hotspot areas equaled 40% of the sales last month. The average new listing coming on the market last month neared $579,975 The average price of a unit going “under contract” neared $436,420 (25% less).

Note: To get an accurate price point for your property, contact me. Coldwell Banker’s big data technology capabilities will put you at an advantage. Houses priced and marketed accurately sell fast, especially with a real estate industry veteran and local expert helping you navigate the process.

Canal Walk Statistics:

  • Canal Walk offers one-floor units, townhouses and various models of single-family units
  • There are 6 homes currently for sale in Canal Walk as of this writing with an average list price of $446,133. Two of these units are in the attorney review process already.
  • Of the 6, only 1 is an Enclave single floor unit
  • There were three new listings this month with an average list price of $479,934.
  • Four units have gone under contract in the past 30 days with an average list price of $444,975 with the average days on the market of 126.
  • Giving us a little over 1 months’ of inventory
  • Close to 50 units changed hands over the past 12 months ranging from the low $300’s into the low $600’s
  • The actual price per unit varies by type, model, location, and upgrades
  • Call for more details…

New Jersey’s Economic Drivers:

New Jersey Home Sales:

Home purchase demand increased by just under .5% in New Jersey during September giving the state its 5th consecutive month of increases. (These numbers run a month behind).  The same number was about 12% in 2016. But the number of new contracts in September was impressive.  The highest for that month since 2005.

New Jersey experienced a compounded growth rate of 22% over the past two years. Sales increased by 5% YTD.

Activity concentrates on the <$400,000 market where Millennial buyers transition into home ownership. During the same period, luxury housing sales showed an impressive increase affected by confidence in the new administration’s plans on taxes and deregulation.

At the same time, the number of homes offered for sale in New Jersey remained low and had recently decreased. The supply decreased by ~ 6,00 homes, compared to a year ago.  Currently, ~31,000 fewer (-42%) homes are on the market compared to the 2011 peak.

Current unsold inventory in New Jersey sits at just under 4.7 months vs. 5.4 months from a year ago.

Hunterdon County has ~9% less inventory, and Somerset County also has ~ 10% less inventory than a year ago.

The fear of increasing interest rates based on future increases and the Fed’s slightly loosening lending standards affect the current market activity.

Interest Rates:

Interest rates at the end of October rose slightly to a level of just over 3.9% for a 30-year conventional mortgage. A fifteen-year conventional mortgage rests at just under the 3.25% range. Five and seven-year arms rest at the 3.2% range.

Consumer fears of steadily rising rates and slowly rising home prices impact the current market. The Fed already instituted initial increases in rates and are talking about additional ones. Industry analysts forecast a 4.7% rate by the end of the year, 5% by the end of 2018, and 5.5% by the end of 2019. If the rate increases from 4% to 5%, buyers will lose 9% of their buying power.

Combine that with the steadily increasing prices and consumer confidence, and you have what is driving our current market activity

National Job Front:

US unemployment rate is 4.2%. This is the lowest it has been for over forty years! And, it is a decline of over 70% from the peak which happened in 2009.

On the national level, we reached full recovery in May of 2014 with 2,700,000+ job gains in 2015. Revised figures show a gain of 2,242,000+ in 2016.  Expectations of 2,000,000 jobs in 2017 leave us at  -6% from 2016.

  • The national U-3 unemployment rate stands at 4.2%.
  • U-6 unemployment rate stands at 8.3%

Note: Due to full-time and part-time jobs counted equally by the BLS, numbers differ.  The US economy still needs to create an additional 2,600,000 jobs to reach the same employment rate that existed before the start of the 2007 to 2009 recession.

But, the momentum is building and the result is consumer confidence is the highest since 2004. Great news for the housing industry !

New Jersey Job Front:

NJ unemployment rate increased to 4.7%, bolstering consumer confidence remains high in NJ as well.

New Jersey job growth increased by 65,000+ in 2015, the best in 15 years. Projecting on those numbers, New Jersey’s recession losses would recover by 2017. To date, we reached 96% of projected numbers. Finalized projected numbers showed 59,000 in 2016. Still good!  Although we still trail the nation, we’re on pace to add 24,000 jobs this year vs. 59,000 being added in 2016 (- 60%).

Thru September, 20,500 additional jobs were added YTD vs. 50,900 for the same period last year.

It should be noted that even though these numbers are disappointing, the levels of the jobs being added at is much higher than in the past several years (a silver lining?).

Rental Market Trends:

Tight Market!

Prior restrictive mortgage standards nudged Millennials to postpone home ownership until later in life than previously seen. These potential buyers live with parents or share rentals. We are starting to see them now re-enter the rental and first-time buyer markets. The average age of our first-time buyer changed from 29 to 37 years over the past five years.  Older Americans impacted by underfunded retirement plans due to the economic downturn rent houses too.

Rental prices in New Jersey rose ~ 10% annually, averaging over $1,300 per unit. Current vacancy rates in New Jersey rest at 3.5%, the lowest in the state and nation.

The drop in New Jersey’s homeownership contributes to rental demand. A 12+ year trend shows a decrease from  71% to 62%. This 13% decrease compared to an 8% national decrease contributes to the slower recovery of home prices in the state. One or two-person households with no children stands at 65%, reflected in our school population.

New Jersey Foreclosures:

New Jersey continues to face high foreclosure rate filings. Other states have begun to, or already have recovered. In tight real estate market, these foreclosures sell at a small discount.

Note:  Figures vary by local market, especially those walloped by Hurricane Sandy three years ago and rural and urban areas. We still rank #1 in the country at 4.1%, followed by NY, LA, MS, ME, FL, MD, PA, MD, RI, and DE.  The national baseline number sits at ~ 1.7%.

2016 saw a 3% decrease over the prior year and added a ~ 71,100 filings, compared to 76,800 in 2015.  2017 YTD  foreclosure filings YTD hold par with 2016 YTD.  Forecasts project 72,000 or -3%, putting pressure home prices in concentrated areas.

 Real Estate Market Recap

  • Consumer confidence is high.
  • 80% of consumers perceive homeownership as part of the American Dream.
  • Millennials make up 24% of homeowners with room for expansion at the lower end of the market with adequate inventory supply.
  • Analysts five-year forecast indicates slow and steady price growth ay an annual 4%.
  • Central New Jersey’s trend for 2016 and early 2017 showed a surge in home sales, but not prices, clustered in < $500,000 market. In 2016, a 1% rise in prices tallied for New Jersey. As inventory builds, prices will rise.
  • In 2017 prices rose ~ 4% in the more popular price points with ideal locations. Projections for 2017 rest at 5% by the end of the year.  Houses priced <$400,000 for first-time buyers, and Millennials experience greater pricing fluctuations.
  • The >$600K market holds steady to diminishing slightly, depending on location and price. Often when a >$600K property goes on the market, it’s competing with a >$700K that needs to sell quickly.
  • People in their home > 10 years think about making a change in a healthy economy.  Home equity built up and a more significant portion of payments applies to principle. Increases in pricing motives people to make changes or even start a new business with the extra equity cash.
  • Minimal new construction adds additional value to the current inventory.
  • Foreclosures help to offset fewer listings.

Somerset County

Net-Net

Either a seller or buyer, navigate the real estate market with me!

  • Low-interest rates
  • Pent-up demand
  • Active market with increasing prices in the more popular price points.

Call me at 908-238-0118 to discuss your situation, and I’ll put my expertise and access to big data to work for you.

Note:  Presented as a public service by Joe Peters of Coldwell Banker Residential Brokerage. I took reasonable precautions presenting this information. Please consult with a professional sales agent and take no actions based on my opinions, gathered trends, and statistics. I assume no liability.

 

Presented as a public service by Joe Peters of Coldwell Banker Residential Brokerage

Joe Peters logo

Request a monthly copy of this newsletter to be sent to you. 

 

Somerset County’s Real Estate Market Conditions – as of October of 2017 – Canal Walk Edition

Somerset County’s Real Estate Market Conditions – as of October of 2017 – Canal Walk Edition

Somerset County’s September sales active with 340 homes sold 

Below is a market update on the real estate and property activity in Somerset County including Branchburg, Bridgewater, Somerville and Hillsborough. This information is provided by courtesy of Somerset County Realtor, Joe Peters.

Under Contract

In September, 340 properties went “under contract” in Somerset County, as compared to 427 reported as going “under contract” in the prior month. During that same period, 421 properties were newly listed.  Based on the most current month’s contract sales, statistics show an overall current supply of about 5 months (4 to 6 months is a normal market) for Somerset County, with an average of 56 days on the market for the units that were sold.

Sales broke down as follows:

  • 70 percent of sales were in houses under $500,000
  • And, 25 percent of sales were in houses between $500,000 and $1 Million
  • Leaving only 5 percent of sales were in houses more than $1 Million

Two areas in Somerset County reported no sales last month:

  • Far Hills
  • Millstone

And two had only 2 sales or less:

  • Raritan Boro
  • Rocky Hill

At the same time, there are the usual hot spots:

  • Bridgewater Township with 37 sales
  • Franklin Township with 78 sales
  • Hillsborough Township with 33 sales

These three areas combined for 44% of total sales last month.  The average new listing coming on the market last month was at nearly $461,056 while the average price of a unit going “under contract” was at nearly $462.,063 or about the same.

Note:  In order to get a true picture of the status of your particular property, this needs to be done by price point within your specific town.  I do this as part of my research when listing a property and can do it for you.  I also can show you how the market is currently trending for your particular town.  Just give me a call.

Houses that are priced properly are selling. There is a current market for them with many active buyers. But more than ever, buyers and sellers need to be working with an experienced agent who has a strong grasp of the market conditions specific to your local area. I can share information on all of these statistics with you. Just call me at 908-238-0118. I can offer you knowledgeable and proven advice based upon my more than 20 years of experience, with a special emphasis on Somerset County.

Canal Walk Statistics:

  • Canal Walk offers one floor units, town houses and various models of single family units
  • There are 6 homes currently for sale in Canal Walk as of this writing with an average list price of $422,833
  • Of the 6, only 1 is an Enclave single floor unit
  • There were one new listings this month with an average list price of $435,000.
  • Five units have gone under contract in the past 30 days with an average list price of $431,930 with the average days on the market of 47.
  • Giving us a little over 1 months’ of inventory
  • Close to 50 units changed hands over the past 12 months ranging from the low $300’s in to the low $600’s
  • The actual price per unit varies by type, model, location and upgrades
  • Call for more details…

Other conditions impacting sales in our area are:

New Jersey Home Sales:

Home purchase demand increased by 3% in New Jersey during August (these numbers run a month behind),  giving the state a 4th consecutive month of increases.  This gives NJ a compounded growth rate of 22% over the past two years.

July’s gain was the highest number of purchase contracts in that month over the past 12 years. And, NJ sales have increased by 6% YTD.

Activity has been most widely seen in the under $400,000 market where the millennial buyers are most active as they transition in to home ownership.  During the same period luxury housing sales showed an increase showing confidence in the new administration’s plans on taxes and deregulation.

At the same time, the number of homes being offered for sale in New Jersey, has remained low, and has recently decreased.  The supply has decreased by some 6,500 homes as compared to a year ago or minus 13%.  And, there are currently 30,000+ fewer (-41%) homes on the market in New Jersey than there were at our peak in NJ in 2011.

The current unsold inventory in New Jersey sits at just under 4.1 month vs. 4.9  months a year ago. Hunterdon County has almost 11% less inventory and Somerset County also has 11% less inventory than just a year ago.

Current increasing interest rates (combined with the fear of higher interest rates in the future) combined with the Fed’s slightly loosening lending standards seems to be driving the current market activity.

Interest Rates:

Interest rates at the end of September have recently hit another low for the year at just over the 3.8% level at 3.9% for a 30 year conventional mortgage. A fifteen year conventional mortgages is at just under the 3.14% range. Five and seven year arms are also at the 3.17% range.

The combination of the fear of steadily rising rates and slowly rising home prices is a driving factor in the current market.   And, the Fed has already instituted initial increases in rates and are currently talking about more to come. Most industry experts are forecasting  a 4.7% rate by the end of the year, 5% by the end of of 2018 and 5.5% by the end of 2019. If the rate merely increases form 4% to 5%, buyers will loose 9% of their buying power.

National and New Jersey Job Front:

On the national level the US reached full recovery in May of 2014 and saw an increase of 2,700,000+ in 2015. Revised figures show a gain of 2,242,000+ in 2016 . And, we are on track to add 2.,000,000 jobs in 2017 (a decrease of 6% from 2016).

The national U-3 unemployment rate stand at 4.4%.  It should be noted, due to full-time and part-time jobs being counted equally by the BLS, these numbers are misleading. Actually, the US Economy still needs to create nearly an additional 2.6+ Million jobs to achieve the same employment situation that existed prior to the start of the 2007 to 2009 recession and the U-6 unemployment rate actually stand at 8.7%

NJ job growth increase by 65,000+ jobs in 2015 (the best in 15 years). At that pace, NJ was on track to recover all of its jobs lost in the recession by 2017 (3 years later than the national level) and has recovered about 96% of those jobs to date.

Finalized numbers show that this number was more in the range of 59,000 in 2016 (also good).

In March and May, NJ reported large decreases in jobs jobs resulting in a net increase of jobs in the first five months of 2017 of only 100 as compared to 15,700 over the same period in the prior year. Thru July 25,700 additional jobs were added YTD vs. 46,500 for the same period last year.

NJ still trails the nation and is on pace to add 32,600 jobs for the year vs. 59,000 being added in 2016 (a 45% decrease).

The NJ unemployment rate has increased slightly to 4.5% which is now at the overall US rate of 4.4%.

Still consumer confidence in NJ seems to remain high.

Rental Market Trends:

Prior restrictive mortgage standards have forced younger age buyers (millennials) to postpone their transition to home ownership until later in life than was previously seen.  For the most part, these potential buyers have been living with mom and dad or sharing rentals with others in the same situation.

Yet, we are starting to see them now re-enter the rental and first time buyer markets.

The average age of our first time buyer is reported to have risen from 29 to 37 years over the past five years.

And, many older age households are selling their homes and moving into rentals to close their gap in underfunded retirement plans which were affected by the recent economic downturns.

The net result of these actions are continuing to cause rental prices to quickly rise in New Jersey (about +10% annually) and keeping rental inventory extremely low. We currently have a 32.3% vacancy rate in central NJ which is the lowest in both the state and nation (with the average rental price topping $1,300).

Contributing to the demand in rentals is the drop in home ownership in NJ which has dropped from 71% to 62% over the past 12+ years.  This is a drop of nearly 13% in NJ as compared to a drop of nearly 8% at the national level and contributes to the slower recovery of home prices in the state.  Also affecting it is the increase in 1 or 2 person households that have no children (now 65%).  This is also reflected in our school population.

As a result of this shift, there are now nearly 300,000 more renters in NJ and very few rentals available.

Foreclosures:

NJ continues to face very high foreclosure rate filings while other states have begun to, or already have recovered.

This figure varies widely by local market.  It is also impacted greatly in areas hit particularly hard by hurricane Sandy (which was just about three years ago).  Also the rural and urban areas have the highest concentration of foreclosures.

NJ still ranks as number one in the country at 4.2% followed by NY and then LA, MS , ME, FL, MD and DE.  Nationally this number is just around 1.7%.

In 2016 there was a 3% decrease over the prior year and added an additional nearly 71,100 filings as compared to 76,800 in 2015.  In 2017 foreclosure filings YTD are on par with 2016 YTDand are forecasted to be in the vicinity of 74,000. These foreclosures will continue to add pressure to home prices (especially in areas where they are concentrated).

The positive news is that in a market starved for inventory, these foreclosures are now only selling at a small discount.

Recap:

Consumer confidence is still at a high.

And, their attitude towards owning a home as part of the American dream is still positive in 8 out of 10 Americans.

Twenty-four percent of all homeowners are millennials and this number is growing steadily.  It would be even higher if we had sufficient inventory to meet their demand o the lower end of the market.

Slow and steady growth in prices is forecasted for the next 5 years with an average annual growth rate of five percent being see.

We saw surge in home sales  (but not prices) in central NJ in 2016 and early 2017.  Especially in the sub $500,000 market.  We are plagued my not having enough inventory in those more popular price points and these sales increases could be even better if we had more inventory.  But, as inventory builds up as prices continue to rise (and people are no longer under water), this should have a positive effect on prices.  In 2016 we saw a less than 1% rise in prices in NJ.

In 2017 prices have already risen by about 4% in the more popular price points (this is dependent on location and price point and location) and this should rise to 5% by end of year in NJ.  We are seeing the most effect on prices in the under $400K markets where the first time buyers and millennials are shopping.  The just over $600K market is holding steady to diminishing slightly depending on location and price.  A lot of times when a $600K property come on the market, it is completing with a $700K that really needs to sell is and now in the $600s competing with them (and so on…). And, in the higher price points there is definite pressure on pricing.

We are also seeing people in their home over 10 years thinking about making a change.   They were reluctant over the past five or so years because of the poor economy.  Their equity has built back up and they now can more comfortably make a change and is now rising greatly as the portion of payments going towards principal has increased. Also, the increase in pricing is fueling this and we are seeing more equity being used to fund business startups.

There is also minimal new construction in  our area which adds additional value to the current inventory.

Our foreclosures are to some extent helping to offset the fewer listings.

Net, net:  As either a seller or buyer, the time could not be better to be in the market.  We still have low interest rates, a pent up demand from both a buyer and seller viewpoint and a very active market with increasing prices in the more popular price points.  Give me a call at 908-238-0118 to discuss your particular situation and let me put my expertise to work for you.

Note: The information presented is deemed accurate but not reliable or guaranteed. Reasonable precautions were taken in the preparation and presentation of this information to ensure accuracy, but the author assumed no liability for any actions taken based on this information. Some opinions expressed represent forecasts of economic conditions as the impact real estate values. All such information is solely conjecture and should be regarded as opinion only and not serve as the sole basis of any financial decision.

Presented as a public service by Joe Peters of Coldwell Banker Residential Brokerage

Request a monthly copy of this newsletter to be sent to you here. 

Canal Walk Market Report

Somerset County’s Real Estate Market Conditions – as of September of 2017 – Canal Walk Edition

Somerset County’s August sales active with 378 homes sold – Canal Walk Edition

Below is a market update on the real estate and property activity in Somerset County including Branchburg, Bridgewater, Somerville and Hillsborough. This information is provided by courtesy of Somerset County Realtor, Joe Peters.

Under Contract

In August, 427 properties went “under contract” in Somerset County, as compared to 378 reported as going “under contract” in the prior month. During that same period, 412 properties were newly listed during the same period.  Based on the most current month’s contract sales, statistics show an overall current supply of about 4 months (4 to 6 months is a normal market) for Somerset County, with an average of 56 days on the market for the units that were sold.

Somerset County Real Estate Report September 2017 Sales broke down as follows:

  • 70 percent of sales were in houses under $500,000
  • And, 27 percent of sales were in houses between $500,000 and $1 Million
  • Leaving only 3 percent of sales were in houses more than $1 Million

Somerset County Report By Municipalities September 2017

Only one area in Somerset County reported no sales last month:

  • Far Hills

And one had only 2 sales or less:

  • Millstone
  • Rocky Hill

At the same time, there are the usual hot spots:

  • Bridgewater Township with 57 sales
  • Franklin Township with 78 sales
  • Hillsborough Township with 53 sales

These three areas combined for 44% of total sales last month.  The average new listing coming on the market last month was at nearly $541,450 while the average price of a unit going “under contract” was at nearly $432,890 or about 20% less.

Note:  In order to get a true picture of the status of your particular property, this needs to be done by price point within your specific town.  I do this as part of my research when listing a property and can do it for you.  I also can show you how the market is currently trending for your particular town.  Just give me a call.

Houses that are priced properly are selling. There is a current market for them with many active buyers. But more than ever, buyers and sellers need to be working with an experienced agent who has a strong grasp of the market conditions specific to your local area. I can share information on all of these statistics with you. Just call me at 908-238-0118. I can offer you knowledgeable and proven advice based upon my more than 20 years of experience, with a special emphasis on Somerset County

Canal Walk Statistics:

  • Canal Walk offers one floor units, town houses and various models of single family units
  • There are 8 homes currently for sale in Canal Walk as of this writing with an average list price of $444,563
  • Of the 8, none are Enclave single floor units
  • There were two new listings this month with an average list price of $452,450.
  • Two units have gone under contract in the past 30 days with an average list price of $425,700 with an average days on the market of 8.
  • Giving us nearly 4 months’ of inventory
  • Close to 50 units changed hands over the past 12 months ranging from the low $300’s in to the low $600’s
  • The actual price per unit varies by type, model, location and upgrades
  • Call for more details…

Other conditions impacting sales in our area are:

New Jersey Home Sales:

Home purchase demand increased by 5% in New Jersey during July (these numbers run a month behind),  giving the state a 3rd consecutive month of increases.  This gives NJ a compounded growth rate of 7% over the past two years.

July’s gain w as the highest number of purchase contracts in that month over the past 12 years. And, NJ sales have increased by 6% YTD.

Activity has been most widely seen in the under $400,000 market where the millennial buyers are most active as they transition in to home ownership.  During the same period luxury housing sales showed an increase showing confidence in the new administration’s plans on taxes and deregulation.

At the same time, the number of homes being offered for sale in New Jersey, has remained low, and has recently decreased.  The supply has decreased by some 7,100 homes as compared to a year ago or minus 14%.  And, there are currently 29,000+ fewer (-40%) homes on the market in New Jersey than there were at our peak in NJ in 2011.

The current unsold inventory in New Jersey sits at just under 4.3 month vs. 5.3  months a year ago. Hunterdon County has almost 19% less inventory and Somerset County has 9% less inventory than just a year ago.

Current increasing interest rates (combined with the fear of higher interest rates in the future) combined with the Fed’s slightly loosening lending standards seems to be driving the current market activity.

Interest Rates:

Interest rates at the end of August have recently stayed at just under the 4% level at 3.9% for a 30 year conventional mortgage. A fifteen year conventional mortgages is at just under the 3.15% range. Five and seven year arms are also at the 3.15% range.

The combination of the fear of steadily rising rates and slowly rising home prices is a driving factor in the current market.   And, the Fed has already instituted initial increases in rates and are currently talking about more to come. Most industry experts are forecasting  a 4.7% rate by the end of the year, 5% by the end of of 2018 and 5.5% by the end of 2019. If the rate merely increases form 4% to 5%, buyers will loose 9% of their buying power.

National and New Jersey Job Front:

On the national level the US reached full recovery in May of 2014 and saw an increase of 2,700,000+ in 2015. Revised figures show a gain of 2,242,000+ in 2016 . And, we are on track to add 2.1000,000 jobs in 2017 (a decrease of 6% from 2016).

The national U-3 unemployment rate stand at 4.3% at the end of June.  It should be noted, due to full-time and part-time jobs being counted equally by the BLS, these numbers are misleading. Actually, the US Economy still needs to create nearly an additional 2.6+ Million jobs to achieve the same employment situation that existed prior to the start of the 2007 to 2009 recession and the U-6 unemployment rate actually stand at 8.7%

NJ job growth increase by 65,000+ jobs in 2015 (the best in 15 years). At that pace, NJ was on track to recover all of its jobs lost in the recession by 2017 (3 years later than the national level) and has recovered about 96% of those jobs to date.

Finalized numbers show that this number was more in the range of 59,000 in 2016 (also good).

In March and May, NJ reported large decreases in jobs jobs resulting in a net increase of jobs in the first five months of 2017 of only 100 as compared to 15,700 over the same period in the prior year. In June and July 24,700 additional jobs were added giving the state a net gain of 28,600 jobs YTD vs. 40,200 for the same period last year.

NJ still trails the nation and is on pace to add 41,900 jobs for the year vs. 59,000 being added in 2016.

The NJ unemployment rate has increased slightly to 4.3% which is now at the overall US rate of 4.3%.

Still consumer confidence in NJ seems to remain high.

Rental Market Trends:

Prior restrictive mortgage standards have forced younger age buyers (millennials) to postpone their transition to home ownership until later in life than was previously seen.  For the most part, these potential buyers have been living with mom and dad or sharing rentals with others in the same situation.

Yet, we are starting to see them now re-enter the rental and first time buyer markets.

The average age of our first time buyer is reported to have risen from 29 to 37 years over the past five years.

And, many older age households are selling their homes and moving into rentals to close their gap in underfunded retirement plans which were affected by the recent economic downturns.

The net result of these actions are continuing to cause rental prices to quickly rise in New Jersey (about +10% annually) and keeping rental inventory extremely low. We currently have a 3.4% vacancy rate in NJ (with the average rental price topping $1,300).

Contributing to the demand in rentals is the drop in home ownership in NJ which has dropped from 71% to 62% over the past 12+ years.  This is a drop of nearly 13% in NJ as compared to a drop of nearly 8% at the national level and contributes to the slower recovery of home prices in the state.  Also affecting it is the increase in 1 or 2 person households that have no children (now 65%).  This is also reflected in our school population.

As a result of this shift, there are now nearly 300,000 more renters in NJ and very few rentals available.

Foreclosures:

NJ continues to face very high foreclosure rate filings while other states have begun to, or already have recovered.

This figure varies widely by local market.  It is also impacted greatly in areas hit particularly hard by hurricane Sandy (which was just about three years ago).  Also the rural and urban areas have the highest concentration of foreclosures.

NJ still ranks as number one in the country at 4.3% followed by NY and then LA, MS , ME, FL, MD and DE.  Nationally this number is just around 1.7%.

NJ experienced a slightly decreased rate in foreclosure filings. In 2016 there was a 3% decrease over the prior year and added an additional nearly 71,100 filings as compared to 76,800 in 2015.  In 2017 foreclosure filings in NJ are forecasted to be in the vicinity 0f 75,000. These foreclosures will continue to add pressure to home prices (especially in areas where they are concentrated).

The positive news is that in a market starved for inventory, these foreclosures are now only selling at a small discount.

Recap:

Last year, 2016 was not a normal year from the elections viewpoint to the US and NJ economy viewpoint.

And, we did not have a severe winter which has kept the buyers out (also not normal).

2017 has started off strong with increases in the stock market, interest rates and, as a result, an increased consumer confidence.  The affordability index is also fueling this confidence.

Yet, industry forecasters are concerned that this confidence could begin to diminish as interest rates and prices continue to rise.

We saw surge in home sales  (but not prices) in central NJ in 2016 and early 2017.  Especially in the sub $500,000 market.  We are plagued my not having enough inventory in those more popular price points and these sales increases could be even better if we had more inventory.  But, as inventory builds up as prices continue to rise (and people are no longer under water), this should have a positive effect on prices.  In 2016 we saw a less than 1% rise in prices in NJ.  In 2017 prices have already risen by about 4% in the more popular price points. And, it is dependent on location and price point.

Year over year in 2017 we have seen a 4% rise so far and it is predicted the this should rise to 5% by end of year in NJ.  Once again, this dependent on location and price point

We are also seeing people in their home over 10 years thinking about making a change.   They were reluctant over the past five or so years because of the poor economy.  Their equity has built back up and they now can more comfortably make a change and is now rising greatly as the portion of payments going towards principal has increased. Also, the increase in pricing is fueling this.

We are seeing the most effect on prices in the under $400K markets where the first time buyers and millennials are shopping.  The just over $600K market is holding steady to diminishing slightly depending on location and price.  A lot of times when a $600K property come on the market, it is completing with a $700K that really needs to sell is and now in the $600s competing with them (and so on…). And, in the higher price points there is definite pressure on pricing.

There is also minimal new construction in  our area which adds additional value to the current inventory.

And, the foreclosures are to some extent helping to offset the fewer listings.

Net, net:  As either a seller or buyer, the time could not be better to be in the market.  We still have low (but increasing) interest rates, a pent up demand from both a buyer and seller viewpoint and a very active market with increasing prices in the more popular price points.  Give me a call at 908-238-0118 to discuss your particular situation and let me put my expertise to work for you.

Note: The information presented is deemed accurate but not reliable or guaranteed. Reasonable precautions were taken in the preparation and presentation of this information to ensure accuracy, but the author assumed no liability for any actions taken based on this information. Some opinions expressed represent forecasts of economic conditions as the impact real estate values. All such information is solely conjecture and should be regarded as opinion only and not serve as the sole basis of any financial decision.

Presented as a public service by Joe Peters of Coldwell Banker Residential Brokerage

Joe Peters logo
Request a monthly copy of this newsletter to be sent to you here. 

Canal Walk Market Report

Somerset County’s Real Estate Market Conditions – as of August of 2017 – Canal Walk Edition

Somerset County’s Real Estate Market Conditions – as of August of 2017 – Canal Walk Edition

Somerset County July sales active with 378 homes sold 

 

 

Below is a market update on the real estate and property activity in Somerset County

including Branchburg, Bridgewater, Somerville and Hillsborough

This information is provided by courtesy of Somerset County Realtor Joe Peters.

In July, 378 properties went “under contract” in Somerset County, as compared to 475 reported as going “under contract” in the prior month. During that same period, 426 properties were newly listed during the same period.  Based on the most current month’s contract sales, statistics show an overall current supply of about 4 months (4 to 6 months is a normal market) for Somerset County, with an average of 57 days on the market for the units that were sold.

Sales broke down as follows:

  • 69 percent of sales were in houses under $500,000
  • And, 27 percent of sales were in houses between $500,000 and $1 Million
  • Leaving only 4 percent of sales were in houses more than $1 Million

Only three areas in Somerset County reported no sales last month:

  • Far Hills
  • Manville
  • Rocky Hill

And one had only 2 sales or less:

  • Peapack Gladstone

At the same time, there are the usual hot spots:

  • Bridgewater Township with 50 sales
  • Franklin Township with 75 sales
  • Hillsborough Township with 53 sales

These three areas combined for 47% of total sales last month.  The average new listing coming on the market last month was at nearly $521,180 while the average price of a unit going “under contract” was at nearly $467,019 or about 10% less.

Note:  In order to get a true picture of the status of your particular property, this needs to be done by price point within your specific town.  I do this as part of my research when listing a property and can do it for you.  I also can show you how the market is currently trending for your particular town.  Just give me a call.

Houses that are priced properly are selling. There is a current market for them with many active buyers. But more than ever, buyers and sellers need to be working with an experienced agent who has a strong grasp of the market conditions specific to your local area. I can share information on all of these statistics with you. Just call me at 908-238-0118. I can offer you knowledgeable and proven advice based upon my more than 20 years of experience, with a special emphasis on Somerset County.

Canal Walk Statistics:

  • Canal Walk offers one floor units, town houses and various models of single family units
  • There are 11 homes currently for sale in Canal Walk as of this writing with an average list price of $418,671.
  • Of the 11, three are Enclave single floor units
  • There were five new listings this month with an average list price of $431,720.
  • Three units have gone under contract in the past 30 days with an average list price of $391,100 with an average days on the market of 29.
  • Giving us nearly 4 months’ of inventory
  • Close to 50 units changed hands over the past 12 months ranging from the low $300’s in to the low $600’s
  • The actual price per unit varies by type, model, location and upgrades
  • Call for more details…

Other conditions impacting sales in our area are:

New Jersey Home Sales:

Home purchase demand increased by 6% in New Jersey during June after an 11% increase in the prior month. This is tied to the limited number of homes on the market and these figures run about a month behind.

Home sales have increased by 17% over the past two years.  May’s gain was the highest number of purchase contracts in that month over the past 12 years. And, NJ sales have increased by 6% YTD.

Activity has been most widely seen in the under $400,000 market where the millennial buyers are most active as they transition in to home ownership.  During the same period luxury housing sales showed an increase showing confidence in the new administration’s plans on taxes and deregulation.

At the same time, the number of homes being offered for sale in New Jersey, has remained low, and has recently decreased.  The supply has decreased by some 7,100 homes as compared to a year ago or minus 14%.  And, there are currently 28,000+ fewer (-39%) homes on the market in New Jersey than there were at our peak in NJ in 2011.

The current unsold inventory in New Jersey sits at just under 3.9 month vs. 4.7 months a year ago. Hunterdon County has almost 11% less inventory and Somerset County has 13% less inventory than just a year ago.

Current increasing interest rates (combined with the fear of higher interest rates in the future) combined with the Fed’s slightly loosening lending standards seems to be driving the current market activity.

Interest Rates:

Interest rates at the end of July have recently increased to just under the 4% level at 3.9% for a 30 year conventional mortgage. A fifteen year conventional mortgages is at just under the 3.2% range. Five and seven year arms are at the 3.15% range.

The combination of the fear of steadily rising rates and slowly rising home prices is a driving factor in the current market.   And, the Fed has already instituted initial increases in rates and are currently talking about more to come. Most industry experts are forecasting  a 4.7% rate by the end of the year, 5% by the end of of 2018 and 5.5% by the end of 2019. If the rate merely increases form 4% to 5%, buyers will loose 9% of their buying power.

National and New Jersey Job Front:

On the national level the US reached full recovery in May of 2014 and saw an increase of 2,700,000+ in 2015. Revised figures show a gain of 2,242,000+ in 2016 (a decrease of 17% from 2015) . And, we are on track to add 2.3000,000 jobs in 2017.  In June 222,000 jobs were added based on preliminary figures.

The national U-3 unemployment rate stand at 4.4% at the end of June.  It should be noted, due to full-time and part-time jobs being counted equally by the BLS, these numbers are misleading. Actually, the US Economy still needs to create nearly an additional 2.6+ Million jobs to achieve the same employment situation that existed prior to the start of the 2007 to 2009 recession and the U-6 unemployment rate actually stand at 8.7+%

NJ job growth increase by 65,000+ jobs in 2015 (the best in 15 years). At that pace, NJ was on track to recover all of its jobs lost in the recession by 2017 (3 years later than the national level) and has recovered about 96% of those jobs to date.

Finalized numbers show that this number was more in the range of 59,000 in 2016 (also good).

In March and May, NJ reported large decreases in jobs jobs resulting in a net increase of jobs in the first five months of 2017 of only 100 as compared to 15,700 over the same period in the prior year. In June 10,600 additional jobs were added giving the state a net gain of 14,500 jobs YTD vs. 25,100 for the same period last year.

NJ still trails the nation and is on pace to add 34,000 jobs for the year vs. 59,000 being added in 2016.

The NJ unemployment rate has decreased slightly to 4.1% which is now under the overall US rate of 4.3%.

Still consumer confidence in NJ seems to remain high.

Rental Market Trends:

Prior restrictive mortgage standards have forced younger age buyers (millennials) to postpone their transition to home ownership until later in life than was previously seen.  For the most part, these potential buyers have been living with mom and dad or sharing rentals with others in the same situation.

Yet, we are starting to see them now re-enter the rental and first time buyer markets.

The average age of our first time buyer is reported to have risen from 29 to 37 years over the past five years.

And, many older age households are selling their homes and moving into rentals to close their gap in underfunded retirement plans which were affected by the recent economic downturns.

The net result of these actions are continuing to cause rental prices to quickly rise in New Jersey (about +10% annually) and keeping rental inventory extremely low. We currently have a 3.4% vacancy rate in NJ (with the average rental price topping $1,300).

Contributing to the demand in rentals is the drop in home ownership in NJ which has dropped from 71% to 62% over the past 12+ years.  This is a drop of nearly 13% in NJ as compared to a drop of nearly 8% at the national level and contributes to the slower recovery of home prices in the state.  Also affecting it is the increase in 1 or 2 person households that have no children (now 65%).  This is also reflected in our school population.

As a result of this shift, there are now nearly 300,000 more renters in NJ and very few rentals available.

Foreclosures:

NJ continues to face very high foreclosure rate filings while other states have begun to, or already have recovered.

This figure varies widely by local market.  It is also impacted greatly in areas hit particularly hard by hurricane Sandy (which was just about three years ago).  Also the rural and urban areas have the highest concentration of foreclosures.

NJ still ranks as number one in the country at 4.4% followed by NY and then LA, MS , ME, FL, MD and DE.  Nationally this number is just around 1.7%.

NJ experienced a slightly decreased rate in foreclosure filings. In 2016 there was a 3% decrease over the prior year and added an additional nearly 71,100 filings as compared to 76,800 in 2015.  In 2017 foreclosure filings in NJ are forecasted to be in the vicinity 0f 76,500. These foreclosures will continue to add pressure to home prices (especially in areas where they are concentrated).

The positive news is that in a market starved for inventory, these foreclosures are now only selling at a small discount.

Recap:

Last year, 2016 was not a normal year from the elections viewpoint to the US and NJ economy viewpoint.

And, we did not have a severe winter which has kept the buyers out (also not normal).

2017 has started off strong with increases in the stock market, interest rates and, as a result, an increased consumer confidence.  The affordability index is also fueling this confidence.

Yet, industry forecasters are concerned that this confidence could begin to diminish as interest rates and prices continue to rise.

We saw surge in home sales  (but not prices) in central NJ in 2016 and early 2017.  Especially in the sub $500,000 market.  We are plagued my not having enough inventory in those more popular price points and these sales increases could be even better if we had more inventory.  But, as inventory builds up as prices continue to rise (and people are no longer under water), this should have a positive effect on prices.  In 2016 we saw a less than 1% rise in prices in NJ.  In 2017 prices have already risen by about 3% in the more popular price points. And, it is dependent on location and price point.

Year over year in 2017 we have seen a 3% rise so far and it is predicted the this should rise to 5% by end of year in NJ.  Once again, this dependent on location and price point

We are also seeing people in their home over 10 years thinking about making a change.   They were reluctant over the past five or so years because of the poor economy.  Their equity has built back up and they now can more comfortably make a change and is now rising greatly as the portion of payments going towards principal has increased. Also, the increase in pricing is fueling this.

We are seeing the most effect on prices in the under $400K markets where the first time buyers and millennials are shopping.  The just over $600K market is holding steady to diminishing slightly depending on location and price.  A lot of times when a $600K property come on the market, it is completing with a $700K that really needs to sell is and now in the $600s competing with them (and so on…). And, in the higher price points there is definite pressure on pricing.

There is also minimal new construction in  our area which adds additional value to the current inventory.

And, the foreclosures are to some extent helping to offset the fewer listings.

Net, net:  As either a seller or buyer, the time could not be better to be in the market.  We still have low (but increasing) interest rates, a pent up demand from both a buyer and seller viewpoint and a very active market with increasing prices in the more popular price points.  Give me a call at 908-238-0118 to discuss your particular situation and let me put my expertise to work for you.

Note: The information presented is deemed accurate but not reliable or guaranteed. Reasonable precautions were taken in the preparation and presentation of this information to ensure accuracy, but the author assumed no liability for any actions taken based on this information. Some opinions expressed represent forecasts of economic conditions as the impact real estate values. All such information is solely conjecture and should be regarded as opinion only and not serve as the sole basis of any financial decision.

Presented as a public service by Joe Peters of Coldwell Banker Residential Brokerage

Request a monthly copy of this newsletter to be sent to you here.