Welcome to my Hunterdon County Market Report—a monthly update where I apply my in-depth expertise to break down the latest developments in our local real estate market. Each edition examines the economic factors and trends that shape property values in our community. This isn’t just a collection of numbers; it features hyper-local insights rarely available elsewhere. By the end, you’ll have a clear grasp of both the “What” and the “Why” behind market movements, equipping you to make confident, informed real estate decisions throughout 2025.

You can also find a version of the report covering Hunterdon County here.

“What’s Happening in Hunterdon County’s Real Estate Market?

156  Under Contract Listings      $693K Average List Price       34 Average Days on Market

Homes for sale have increased by over 40% since January

While homes for sale have increased by about 45% in NJ statewide, since the first of the year, homes sold have seen a modest 1% decline year-to-date.

In Hunterdon County, the unsold inventory has remained relatively unchanged from last year.

Mortgage rates are hovering just under 6.8%, holding steady from last month. Recent trade negotiations briefly pushed rates back above 7%, and they appear to be stabilizing at that level. Forecasts suggest a slow decline over the coming months, potentially dipping into the low 6,5% range by year-end. However, continued bond market volatility could cause rates to rise above 7% again before easing.

Zooming out, the broader real estate market is beginning to show signs of returning to a more balanced state. Inventory levels are approaching a four-month supply in the upper price tiers, which may trend downward. Fewer properties are now selling for significantly more than the asking price, and more offers include traditional contingencies, such as financing, home sale, and inspection clauses. New listings have grown over the past month, boosting overall inventory. Yet, demand continues to exceed supply in our more popular penpoints, keeping upward pressure on prices throughout our region.

For those considering a move, these trends offer essential insights. The market still leans in favor of sellers, mainly due to the fast turnover of available homes, which helps sustain local price stability. However, we are already seeing early signs of a gradual shift toward a buyer’s market in the higher-end segments. Over the past five years, home prices in New Jersey have surged nearly 68%. In 2024 alone, growth was a more modest 8%. Homes priced at $900,000 and above are now experiencing rising inventory, which is beginning to impact supply-demand dynamics.

Meanwhile, properties under the $900K mark continue to appreciate, although the pace has slowed. Future gains are expected to be more moderate yet still positive. Historically, home prices in the state have increased at an average annual rate of under 5% over the past fifty years.

🏡📈

Market Statistics for Hunterdon County:

• Last month, the market saw a decrease in new inventory, with 122 new listings, compared to 152 in the previous month. This decreased from 130 new listings in the same month in 2024.
• As of the beginning of this month, the available inventory has increased slightly to 266 units, up from 265 units last month. This is lower than last year’s 268 units available in the same month.  A lot of this new inventory is in our higher price points.
• The number of units that went “under contract” last month was 156, the same as 156 the previous month but down from 138 in the same month last year.
• Over the past month, the average number of days on the market has risen slightly to 34 from the previous month’s level of 30.
• Currently, the month’s supply of inventory matches last month’s level of 1.7, indicating a strong seller’s market. This trend holds for properties priced under $1,000K
• The current month’s supply still represents a strong seller’s market with rising prices.

Considering the current market conditions, where the supply and demand dynamics favor sellers, postponing your sale until later in 2025 may not be the best choice. The market is likely nearing (or at) its peak, and it’s unlikely that prices will remain elevated for much longer. Therefore, it would be wise to capitalize on the current situation and list your property for sale now.

In summary, acting promptly in the current market could benefit sellers.

New Jersey Residential Real Estate Market Forecast

The second half of 2024 saw solid activity in both listings and sales. Early 2025 was hindered by weather, but inventory levels are now at or above those from a year ago.

Although inventory levels have recently increased, new listings continue to sell quickly, leading to strong sales and favorable prices for sellers. However, the biggest challenge in 2025 remains finding a more suitable home and securing an affordable mortgage.

The recent stability in interest rates has slowed buyers’ optimism compared to a few months ago. This has also similarly impacted trade-up buyers, although we are seeing more of this than in past months.

However, interest rates have priced many first-time buyers out of the market, making most trade-up buyers still hesitant to move.

Until the average month’s supply nears 4 months, we will not see any appreciable price reductions.

Hunterdon County Real Estate Market Inventory Breakdown By Price For Last Month:

• 38% of sales in houses > $500,000
• 37% of sales in the $500,000 to the $1,00,000 range
• 25% of total sales (or 43 in total) in houses >$1,000,000

Hunterdon County Real Estate Market Inventory Breakdown By Municipality For Last Month

Three areas had no sales last month:

• Bloomsbury
• Frenchtown
• Milford

Eight areas had 1 or 2 sales each last month:

• Bethlehem Twp.
• Califon
• Glen Gardner
• Hampton
• Kingwood
• Lebanon Boro.
• Stockton
• W Amwell

Hotspots:

• Clinton/Clinton  Twp. – 22 Sales
• Raritan- 32 Sales
• Readington – 16 Sales

Approximately 45% of sales were concentrated in the hotspot areas in the past month. Here’s a breakdown of the average prices:

• New Listings Entering the Market: The average list price for these new listings was $819,026.
• Units Going Under Contract: The average list price for units that went under contract was  $692,128.
• This represents a 16% difference between the average prices of new listings and units under contract.”

In summary, understanding these price dynamics can provide valuable insights for buyers and sellers in the real estate market.

Note:

If you want to obtain a competitive price for your property based on its location and uniqueness, you can contact me at (908) 304-4660. By leveraging Coldwell Banker’s big data technology and Artificial Intelligence capabilities, you can gain a unique advantage in the market. I can demonstrate your area’s latest age and earnings breakdown, including where people are moving from and how to market directly to those specific areas and demographics. This approach will maximize the selling price while reducing the time on the market. Accurately priced and marketed homes tend to sell faster with the assistance of a seasoned real estate industry veteran and a local area expert.

“Why” is it happening…

New Jersey’s Economic Drivers:

New Jersey Home Sales and Inventory Levels:

Contrary to what you see on the news, remember that real estate is hyper-local, and the Hunterdon and Somerset county markets remain strong.  While the network news is correct for some areas in the country (mainly those with heavy new development sales), my report focuses only on our two counties in NJ, which consist primarily of resales. Our only new construction is mainly from the high-end of the market.

• So far in 2025, we’ve seen a modest 1% decline in units sold year-to-date.
• Locally, sales in June in Hunterdon and Somerset County remained about the same compared to the previous month.
• There are early signs of a pullback in pricing at the higher price tiers, but the lower tiers are still experiencing price increases, albeit not as aggressively as in the past.
• First-time buyers are cooling down considerably due to higher pricing (price resistance), inventory shortages, and interest rates. Their purchasing power has decreased for these reasons, and many have been priced out of the market for the time being. Additionally, higher insurance and taxation are being factored into this equation.
• Potential sellers find it challenging to locate suitable housing in the current market and are hesitant to list until they do. They are also dismayed by the higher interest rates they currently have on their homes and, for the most part, are not willing to make a move unless they have an urgent issue, such as a life event or job transfer. Higher interest rates also diminish their purchasing power, but their equity increases could offset it.
• Current mortgage statistics show that nearly 40% of homeowners own their homes outright. The other 60% are split evenly between mortgages with interest rates under 4% and above 4%. The group under 4% is not likely to make a change due to its current low rates.
• The current month’s inventory supply in Hunterdon County is at 1.7 months. In Somerset County, the average duration is approximately 1.55 months, due to the rapid sales of new listings (velocity), as the market remains active.
• Hunterdon has about the same inventory, and Somerset County has 17% more than it did a year ago. The unsold inventory in New Jersey has steadily decreased since reaching a peak of over 20,000, and it is now down to approximately 17,200. It should be noted that all price points have seen YTD increases statewide.
• New housing development has not kept up with population growth and is now focused on the rental market.

Interest Rates:

• Interest rates hovered around 6.9% again in early July of 2025.
• The Fed cut rates by 1% in the 4th quarter, which was already built into the current rates as they were widely expected.
• Since then, economic conditions (fears of continued inflation and high unemployment) caused the rise back to about 7% and are now down to 6.8%
• Based on recent economic indicators, interest rates are expected to decline gradually. However, we are likely to remain in the 6.75 to 7% range for now (time will tell). We may see further declines in the second half of the year, but not anywhere near 6%.
• Many buyers consider attractive ARM rates and creative other buy-down plans as alternatives.
• Based on the current rates, first-time buyer mortgage applications have dropped, but restructuring debt and paying down high-interest items remain active.
• The Fed’s efforts to slow down the economy have resulted in the above.

National Job Front:

• The U.S. Bureau of Labor Statistics reported that total nonfarm payroll employment increased by 147,000 in June, and unemployment dropped to 4.1 percent. Employment continued to grow in non-government, healthcare, social assistance, and construction.
• At the same time, April and May numbers were revised upwards, affirming that the U.S. labor market remains stable. However, this gets little exposure on the network news channels.
• This first report showed that most jobs were created in the private sector, and the average wage rose by 4%.
• It’s essential to note that this number includes natural job growth of approximately 175,000 per month.
• The labor force participation rate dropped slightly to 62.3 percent. This rate is calculated by dividing the total number of workers employed or actively seeking employment by the working-age population. It also fluctuates because people take a second job to make ends meet.
• Many have resigned to pursue new career paths due to perceived health risks, the desire for more remote work, and a better work-life balance. New technology-based jobs are affecting this trend, which seems to be reversing, especially in larger firms.
• For those under $50K, there is even an incentive not to work and collect benefits, contributing to the current unemployment rate.
• The lower end of the job market has benefited the most from this trend, with higher starting pay rates competing for a lack of workforce. Jobs beginning in the mid to upper $20 per hour are already being offered.

New Jersey Job Front:

• Statewide, we saw a 66% decrease in new jobs in 2024.
• The unemployment rate in NJ for May remained at 4.8%, still quite a bit above the national rate.
• NJ has gained about 39,800 YTD through December of 2024, compared to 90,000 in 2023. The state only added 700 jobs in YTD.
• Job losses remain prevalent in the construction, food services, and accommodation industries. Retail and wholesale trade are also experiencing a downturn in some states. Even health care, social assistance, and manufacturing are shedding workers.
• NJ was hit harder than most states in the early months of the pandemic, but it has made a remarkable recovery since then.
• It is worth noting that the number of jobs in New Jersey lags behind the national average by one month.

Rental Market Trends:

• Rental prices in central New Jersey continued to increase in 2024, with a year-over-year average of 2.1%. They are currently averaging just over $2,400 per unit. However, recent data shows a slight decrease in these prices, and over 32,000 units are now under construction.
• The vacancy rate in central New Jersey is currently at 5.2%, indicating an increase in rental supply and leading to a decrease in rental prices.
• The rental market typically includes low-end buyers who opt to rent due to a shortage of available inventory. However, the recent constraints in the mortgage market have also contributed to the increase in this sector.
• In a nutshell, many renters would prefer to buy a home as it is a good financial investment but face issues with availability and affordability that force them to rent for now.

New Jersey Foreclosures:

• NJ’s delinquency rate (more than 90 days past due) has decreased, which is a positive development.
• NJ’s current foreclosure rate remains low at 1.1%.
• Nationally, $11 trillion in equity is needed to protect homeowners in the event of a potential recession.
• The average FICO score of mortgage holders is over 750, higher than during the 2008 financial crisis.
• A slowdown and recession could still cause job losses and put mortgages at risk.
• A housing bust is not predicted to occur, as there is a significant amount of positive equity in houses, thanks to recent appreciations.

Real Estate Market Recap

Forecast:

• The COVID-19 pandemic is now behind us.
• Supply chain shortages have contributed to inflation, and concerns persist that an undersupply could lead to further price increases.
• The consumer price index, which rose by 3% over the past 12 months, continues to cause havoc on auto, finished goods, and energy pricing and is the enemy of long-term interest rates. The May YOY for this year is at +2.4%, which is encouraging.
• Mortgage rates have reversed their 3Q24 pullback and are now around 6.8%.
• The local inventory accumulates primarily in the more expensive price ranges, and the housing affordability index has increased slightly (based on wages, rates, and home prices). As a result, mortgage payments now have an all-time high gross percentage (which slows spending in other sectors).
• Due to COVID-19 and recent unrest in NYC, interest in living in more suburban counties, such as Hunterdon and Somerset, has declined. Many companies now require more on-site presence, reversing the trend of moving westward.
• Retailing and using vacant industrial space will transform to meet the new, altered demands and lifestyles.
• The local market will have to adapt to the new suburban renaissance, considering where people will work and what they need to accommodate.
• The lingering question has been, “Can we keep this momentum up with low to slightly rising inventory?” as predictions for slower sales and price increases in 2024 have already been made. Price increases were about 11% in 2023 and 8% in 2024 in NJ. In 2025, the predictions are around the 2 to 3% range.
• Days on the market in our area have increased over the past month, indicating that buyers are becoming less active during the winter months.
• However, change will result in a trend towards a more normalized environment if inventory continues to come onto the market and first-time buyer fatigue continues.
• Younger (millennial) buyers are coming of age in the pipeline for at least the next four to five years, which will continue to put more demand on the first-time buyer market, usually under $400K, where inventory is up by 18% over this time in 2024 slaes are down which indicates the affordability issue previously mentioned.
• Housing markets are adding much of the new inventory at higher price points, normalizing those results. Change usually happens from the top down and from east to west.
• In a nutshell, 2025 looks much like 2024, with more inventory and fewer sales. As a result, prices are still rising across Hunterdon and Somerset County until they reach the $1,000,000 mark. The real question remains if and when we will see prices and interest start to drop.

This is substantial information, and the situation is evolving daily. Nevertheless, it appears to be moving in a positive direction for now. If you require further clarification or have any concerns about how this could impact your circumstances, please don’t hesitate to contact me at (908) 304-4660. I’m always available to chat and assist you in gaining a better understanding.

Note: Joe Peters of Coldwell Banker Residential Brokerage presents this information as a public service. Although reasonable care has been taken to provide this information, it is advised that you seek the guidance of a professional sales agent and avoid making any decisions solely based on my views, gathered trends, and statistics. I am not responsible for any consequences of using this data.

If you have any questions or would like to talk out your situation, please call 908-304-4660

Home Prices Forecast To Climb over the Next 5 Years [INFOGRAPHIC]

You can ask me a question or request a monthly newsletter copy here.