Real Estate Market Update Report Somerset County NJ

Somerset County’s Real Estate Market Conditions | February of 2018

Somerset County’s Real Estate Market Conditions | February of 2018

Real Estate Market Conditions

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 65 days on the market. 263 properties went “under contract” in January, down from 338 in the prior month. Newly listed properties in the same period totaled 352.

Somerset County Inventory Breakdown by Price for last month:

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:

  • 74 % of sales in houses < $500,000
  • 22 %of sales in houses > $500,000 and < $1,000,000
  • 04 % percent of total sales (or 10 in total) in houses >$1,000,000

Somerset County Inventory Breakdown by Municipality for last month.

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

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

Seven areas reported one or two sales each last month:

  • Bound Brook
  • Millstone
  • N Plainfield
  • Raritan
  • Rock Hill
  • Somerville
  • S Bound Brook

Hotspots:

  • Bernards – 22 sales
  • Bridgewater – 25 sales
  • Franklin – 57 sales
  • Hillsborough – 34 sales
  • Montgomery – 14 sales
  • N Plainfield – 20 sales

These hotspot areas equaled 65% of the sales last month. The average new listing coming on the market last month neared $570,645 The average price of a unit going “under contract” neared $432,685 (24% less).

It is curious that sales over $700K were down noticeably.  Could the new tax rules already having an effect?  Going to take a few more months to understand the better.

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. Plus, we can now tell you where people are moving in to your area from and market to that area directly. Houses priced and marketed accurately sell fast, especially with a real estate industry veteran and local expert helping you navigate the process.

 

New Jersey’s Economic Drivers:

 

New Jersey Home Sales:

Home purchase demand was flat for December in New Jersey after two consecutive months of increases before that (These numbers run a month behind).  This is about a 4% over 2016.

But, a 12 year high was achieved in 2017 (and a 5% increase over 2016) with over 115K contracts reported.

The effect of the new Tax and Jobs Act is still being digested and may slow things down while this takes place.

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. There has also been some improvement at the very high end in towns where rail service to Manhattan is available.

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, ~40,000 fewer (-55%) homes are on the market compared to the 2011 peak.

Current unsold inventory in New Jersey sits at just under five months vs. 5.8 months from a year ago.

We have an acute shortage of inventory in both Hunterdon and Somerset county in our more popular price points and locations.

Hunterdon County has ~14% less inventory, and Somerset County has ~ 16% less inventory than a year ago.  And, both counties have about 24% less inventory than two years ago.

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

 

Interest Rates:

Interest rates at the end of January rose slightly to a level of just over 4% for a 30-year conventional mortgage. A fifteen-year conventional mortgage rests at just under the 3.65% range. Five and seven-year arms are just under the 3.5% 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 to be nearly 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%. The lowest it has been in over seventeen years and new claims are the lowest in 44 years! This trend is expected to continue as a result of the recent tax reform.

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 2,100,000 jobs in 2017 leave us at  -5% from 2016.

  • The national U-3 unemployment rate stands at 4.1%
  • U-6 unemployment rate stands at 8%

 

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 5.1%, bolstering consumer confidence remains high in NJ as well.

In December, NJ lost a disappointing 11,000 jobs.

New Jersey job growth increased by 65,000+ in 2015, the best in 15 years. Based 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 only 23,000 jobs in 2017 vs. the 59,000 in 2016 (- 61%).

Although these numbers are disappointing, the level of jobs created was at a much higher level than in the past several years (a silver lining?).

 

Rental Market Trends:

We have an extremely tight rental market!

Prior restrictive mortgage standards nudged Millennials to postpone home ownership in life later 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 ~ 4% in 2017, averaging over $1,500 per unit. Current vacancy rates in central New Jersey rest at 2.4%, the lowest in the state (which is at 4.2%) and the 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 62%.  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 rank #2 in the country at 3.7%, led by only NY and followed by 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 slightly with 2016 YTD.  Forecasts project 70,100+ or -5%, putting pressure home prices in concentrated areas.

 

Tax cuts and Jobs Act effect:

Three specific areas are evident:

  1. State and Local Taxes (SALT) are now limited to a $10,000 deduction going forward.
  2. Mortgage and Interest Deductions (MID) are now limited to a maximum principal balance of $750,000.
  3. Home Equity Line of Credit (HELOC) Loan interest deductions is for the most part eliminated

Although it is too early to tell how these areas will impact real estate values in New Jersey, they are sure to have some impact. New Jersey is one of the highest taxed states in the union, and our home values are also some of the highest. How this affects each of us on an individual basis needs to be better understood as there is some trade-off such as higher deductions and overall lower income brackets.

Obviously, the higher income luxury market is probably most at risk.  But how it affects the overall incentive to own a home is still unfolding.

There were several proposals on the new tax code and most consumers are not up to date on what actual passed.  It will take time to be digested.

It also is evident that the out-migration from New Jersey to other more affordable states has continued.

In a nutshell too early to tell, but there will be people affected, and that will, in turn, affect the market…

 

Real Estate Market Recap

  • Consumer confidence is extremely high based on the job and stock market increases.
  • Buyer traffic is up at open houses reflecting this confidence.
  • 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 at 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 ~ averaging 3% and depending on price points and locations.  2018promises to be better yet.
  • 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.
  • Interest rates are forecasted to rise another .5% in 2018 taking away from they ability to buy the house that you want.
  • 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.
  • 92% of homeowners in NJ currently have positive equity with 77% have greater than 20% equity which is leading to a pent up demand.
  • Minimal new construction adds additional value to the current inventory.
  • Foreclosures help to offset fewer listings.
  • Also, there is some confidence that the new tax and jobs act will stimulate the economy with more jobs.
  • There is an acute shortage of inventory in both Hunterdon and Somerset county in our more popular price points and locations which holds back sales. In turn this effect will hold back additional sales as sellers move up or right-size.

 

Net-Net

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

  • Still low-interest rates
  • Much pent-up demand
  • An 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.

 

 


Presented as a public service by:

Joe Peters Logo
 


USAA members and their families can receive a substantial reduction on their next real estate transaction.

USAA Logo


 

 

Real Estate Market Update Hunterdon County, NJ

Hunterdon County’s Real Estate Market Conditions | February of 2018

Hunterdon County’s Real Estate Market Conditions | February of 2018

Hunterdon County's Real Estate Market Conditions

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

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

  1. Clinton Township
  2. Flemington
  3. Raritan Township
  4. Readington Township
  5. Clinton

Based on the last full month’s contract sales, statistics show a supply of approximately six months. Normal market conditions average four to six months in Hunterdon County.  Units sold averaged 70 days on the market. 107 properties went “under contract” in January, down from 108 in the prior month. Newly listed properties in the same period totaled 164.

Hunterdon County Inventory Breakdown by Price for last month:

New Listings Under Contract Active Listings Month’s Supply
Condos/Town Houses * 42 34 131 4
Over 55 Communities * 9 8 18 2
$000K to $199K 23 27 106 4
$200K to $299K 28 24 119 5
$300K to $399K 33 41 126 3
$400K to $499K 16 24 98 4
$500K to $599K 21 9 102 11
$600K to $699K 10 8 82 10
$700K to $799K 6 2 42 21
$800K to $899K 2 1 19 19
$900K to $999K 3 1 23 23
$1,000K and Up 5 3 63 21
Totals for November 147 140 780 6
Average Price $542,327 $375,793 -30.7%
Average DOM 67
* Included in $ breakdowns

 

Hunterdon County Sales Breakdown Overview:

  • 79 % of sales in houses < $500,000
  • 21 % of sales in houses > $500,000
  • 02 % percent of total sales (or 2 in total) in houses >$700,000

Hunterdon County Inventory Breakdown by Municipality for last month:

Active Listings Under Contract Month’s Supply
Alexandria Twp. 34 6 6
Bethlehem Twp. 20 3 7
Bloomsbury Boro. 7 0
Califon Boro. 6 1 6
Clinton Town 16 3 5
Clinton Twp. 72 9 8
Delaware Twp. 37 0
East Amwell Twp. 32 6 5
Flemington Boro. 17 1 17
Franklin Twp. 27 6 5
Frenchtown Boro. 26 1 26
Glen Gardner Boro. 15 1 15
Hampton Boro 11 4 3
High Bridge Boro. 21 6 4
Holland twp. 27 4 7
Kingwood Twp. 20 8 3
Lambertville City 18 9 2
Lebanon Boro. 3 4 1
Lebanon Twp. 36 4 9
Milford Boro. 9 0
RaritanTwp. 123 26 5
Readington Twp. 83 23 4
Stockton Boro. 1 0
Tewksbury Twp. 74 9 8
Union Twp. 35 5 7
West Amwell Twp. 10 1 10
Totals 780 140

 

Hunterdon County Sales Breakdown Detailed:

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

  • Bloomsbury
  • Kingwood

Seven areas reported one sale each last month:

  • Califon
  • E. Amwell
  • Flemington
  • Franklin Twp.
  • Glen Gardner
  • Lambertville
  • Milford

Hotspots:

  • Clinton/Clinton Township – 11 sales
  • Raritan Township – 22 sales
  • Readington Township – 13 sales

Hotspot areas equaled 43% of the sales last month. The average new listing coming on the market last month neared $457,578. The average price of a unit going “under contract” neared $359,559 (21% less).

It is curious that we had o sales over the $700K bracket.  Could the new tax rules have already had an effect?

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. Plus, we can now tell you where people are moving into your area from and market to that area directly.  Houses priced and marketed accurately sell fast, especially with a real estate industry veteran and local expert helping you navigate the process.

New Jersey’s Economic Drivers:

 

New Jersey Home Sales:

Home purchase demand was flat for December in New Jersey after two consecutive months of increases before that (These numbers run a month behind).  This is about a 4% over 2016.

But, a 12 year high was achieved in 2017 (and a 5% increase over 2016) with over 115K contracts reported.

The effect of the new Tax and Jobs Act is still being digested and may slow things down while this takes place.

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. There has also been some improvement at the very high end in towns where rail service to Manhattan is available.

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, ~40,000 fewer (-55%) homes are on the market compared to the 2011 peak.

Current unsold inventory in New Jersey sits at just under five months vs. 5.8 months from a year ago.

We have an acute shortage of inventory in both Hunterdon and Somerset county in our more popular price points and locations.

Hunterdon County has ~14% less inventory, and Somerset County has ~ 16% less inventory than a year ago.  And, both counties have about 24% less inventory than two years ago.

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

 

Interest Rates:

Interest rates at the end of January rose slightly to a level of just over 4% for a 30-year conventional mortgage. A fifteen-year conventional mortgage rests at just under the 3.65% range. Five and seven-year arms are just under the 3.5% 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 to be nearly 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%. The lowest it has been in over seventeen years and new claims are the lowest in 44 years! This trend is expected to continue as a result of the recent tax reform.

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 2,100,000 jobs in 2017 leave us at  -5% from 2016.

  • The national U-3 unemployment rate stands at 4.1%
  • U-6 unemployment rate stands at 8%

 

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 5.1%, bolstering consumer confidence remains high in NJ as well.

In December, NJ lost a disappointing 11,000 jobs.

New Jersey job growth increased by 65,000+ in 2015, the best in 15 years. Based 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 only 23,000 jobs in 2017 vs. the 59,000 in 2016 (- 61%).

Although these numbers are disappointing, the level of jobs created was at a much higher level than in the past several years (a silver lining?).

 

Rental Market Trends:

We have an extremely tight rental market!

Prior restrictive mortgage standards nudged Millennials to postpone home ownership in life later 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 ~ 4% in 2017, averaging over $1,500 per unit. Current vacancy rates in central New Jersey rest at 2.4%, the lowest in the state (which is at 4.2%) and the 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 62%.  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 rank #2 in the country at 3.7%, led by only NY and followed by 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 slightly with 2016 YTD.  Forecasts project 70,100+ or -5%, putting pressure home prices in concentrated areas.

 

Tax cuts and Jobs Act effect:

Three specific areas are evident:

  1. State and Local Taxes (SALT) are now limited to a $10,000 deduction going forward.
  2. Mortgage and Interest Deductions (MID) are now limited to a maximum principal balance of $750,000.
  3. Home Equity Line of Credit (HELOC) Loan interest deductions is for the most part eliminated

Although it is too early to tell how these areas will impact real estate values in New Jersey, they are sure to have some impact. New Jersey is one of the highest taxed states in the union, and our home values are also some of the highest. How this affects each of us on an individual basis needs to be better understood as there is some trade-off such as higher deductions and overall lower income brackets.

Obviously, the higher income luxury market is probably most at risk.  But how it affects the overall incentive to own a home is still unfolding.

There were several proposals on the new tax code and most consumers are not up to date on what actual passed.  It will take time to be digested.

It also is evident that the out-migration from New Jersey to other more affordable states has continued.

In a nutshell too early to tell, but there will be people affected, and that will, in turn, affect the market…

 

Real Estate Market Recap

  • Consumer confidence is extremely high based on the job and stock market increases.
  • Buyer traffic is up at open houses reflecting this confidence.
  • 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 at 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 ~ averaging 3% and depending on price points and locations.  2018promises to be better yet.
  • 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.
  • Interest rates are forecasted to rise another .5% in 2018 taking away from they ability to buy the house that you want.
  • 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.
  • 92% of homeowners in NJ currently have positive equity with 77% have greater than 20% equity which is leading to a pent up demand.
  • Minimal new construction adds additional value to the current inventory.
  • Foreclosures help to offset fewer listings.
  • Also, there is some confidence that the new tax and jobs act will stimulate the economy with more jobs.
  • There is an acute shortage of inventory in both Hunterdon and Somerset county in our more popular price points and locations which holds back sales. In turn this effect will hold back additional sales as sellers move up or right-size.

 

Net-Net

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

  • Still low-interest rates
  • Much pent-up demand
  • An 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.

 


Presented as a public service by:

Joe Peters Logo
 


USAA members and their families can receive a substantial reduction on their next real estate transaction.

USAA Logo


 

 

Real Estate Market Update Hunterdon County, NJ

Hunterdon County’s Real Estate Market Conditions | January of 2018

Hunterdon County’s Real Estate Market Conditions | January of 2018

Hunterdon County's Real Estate Market Conditions

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

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

  1. Clinton Township
  2. Flemington
  3. Raritan Township
  4. Readington Township
  5. Clinton

Based on the last full month’s contract sales, statistics show a supply of approximately six months. Normal market conditions average four to six months in Hunterdon County.  Units sold averaged 83 days on the market. 108 properties went “under contract” in December, down from 140 in the prior month. Newly listed properties in the same period totaled 196.

Hunterdon County Inventory Breakdown by Price for last month:

New Listings Under Contract Active Listings Month’s Supply
Condos/Town Houses * 42 34 131 4
Over 55 Communities * 9 8 18 2
$000K to $199K 23 27 106 4
$200K to $299K 28 24 119 5
$300K to $399K 33 41 126 3
$400K to $499K 16 24 98 4
$500K to $599K 21 9 102 11
$600K to $699K 10 8 82 10
$700K to $799K 6 2 42 21
$800K to $899K 2 1 19 19
$900K to $999K 3 1 23 23
$1,000K and Up 5 3 63 21
Totals for November 147 140 780 6
Average Price $542,327 $375,793 -30.7%
Average DOM 67
* Included in $ breakdowns

 

Hunterdon County Sales Breakdown Overview:

  • 79 % of sales in houses < $500,000
  • 21 % of sales in houses > $500,000
  • 06 % percent of total sales (or 7 in total) in houses >$700,000

Hunterdon County Inventory Breakdown by Municipality for last month:

Active Listings Under Contract Month’s Supply
Alexandria Twp. 34 6 6
Bethlehem Twp. 20 3 7
Bloomsbury Boro. 7 0
Califon Boro. 6 1 6
Clinton Town 16 3 5
Clinton Twp. 72 9 8
Delaware Twp. 37 0
East Amwell Twp. 32 6 5
Flemington Boro. 17 1 17
Franklin Twp. 27 6 5
Frenchtown Boro. 26 1 26
Glen Gardner Boro. 15 1 15
Hampton Boro 11 4 3
High Bridge Boro. 21 6 4
Holland twp. 27 4 7
Kingwood Twp. 20 8 3
Lambertville City 18 9 2
Lebanon Boro. 3 4 1
Lebanon Twp. 36 4 9
Milford Boro. 9 0
RaritanTwp. 123 26 5
Readington Twp. 83 23 4
Stockton Boro. 1 0
Tewksbury Twp. 74 9 8
Union Twp. 35 5 7
West Amwell Twp. 10 1 10
Totals 780 140

Three areas in Hunterdon County reported no sales in the past month:

Hunterdon County Sales Breakdown Detailed:

  • Hampton
  • Stockton
  • W Amwell

Five areas reported one sale each last month:

  • Bloomsbury
  • Califon
  • Flemington
  • Frenchtown
  • Lebanon Boro

Hotspots:

  • Clinton/Clinton Township – 12 sales
  • Raritan Township – 21 sales
  • Readington Township – 17 sales

Hotspot areas equaled 46% of the sales last month. The average new listing coming on the market last month neared $509,046. The average price of a unit going “under contract” neared $395,484 (22% 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. Plus, we can now tell you where people are moving in to your area from and market to that area directly.  Houses priced and marketed accurately sell fast, especially with a real estate industry veteran and local expert helping you navigate the process.

New Jersey’s Economic Drivers:

New Jersey Home Sales:

Home purchase demand increased by 5% in New Jersey during November giving the state its 7th consecutive month of increases. (These numbers run a month behind).  The same number were about 9% in 2016.

New Jersey experienced a compounded growth rate of 17% 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. There has also been some improvement at the very high end in towns where rail service to Manhattan is available.

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, ~37,000 fewer (-50%) homes are on the market compared to the 2011 peak.

Current unsold inventory in New Jersey sits at just under 4.4 months vs. 5.4 months from a year ago.

We have an acute shortage of inventory in both Hunterdon and Somerset county in our more popular price points and locations.

Hunterdon County has ~18% less inventory, and Somerset County also has ~ 16% less inventory than a year ago.

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

Interest Rates:

Interest rates at the end of December rose slightly to a level of just over 3.98% for a 30-year conventional mortgage. A fifteen-year conventional mortgage rests at just under the 3.4% range. Five and seven-year arms are just under the 3.5% 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 to be nearly 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 2,100,000 jobs in 2017 leave us at  -5% from 2016.

  • The national U-3 unemployment rate stands at 4.1% (the lowest in over forty years)
  • U-6 unemployment rate stands at 8%

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 5.1%, 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 39,000 jobs this year vs. 59,000 being added in 2016 (- 34%).

Thru November, 33,000 additional jobs were added YTD vs. 50,900 for the same period last year.

It should be noted that even though these numbers are somewhat 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 central New Jersey rest at 2.4%, the lowest in the state (which is at 4.2%) and the 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 62%.  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 3.8%, 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 -4%, putting pressure home prices in concentrated areas.

Tax cuts and Jobs Act effect:

There are two specific areas that are evident:

  1. State and Local Taxes (SALT) have been limited to a $10,000 deduction going forward.
  2. Mortgage and Interest Deductions (MID) has been limited to a maximum principal balance of $750,000.

Although it is too early to tell how these 2 areas will impact real estate values in New Jersey, they are sure to have some impact. This is based on our state being one of the highest taxed states in the union and our home values being some of the highest. How this affects each of us on an individual basis needs to be better understood as there are some trade-off such as higher deductions.

In a nutshell too early to tell…

 Real Estate Market Recap

  • Consumer confidence is extremely 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 ~ nearly 5% in the more popular price points with ideal locations.
  • 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.
  • Also, there is some confidence that the new tax and jobs act will stimulate the economy with more jobs.
  • We have an acute shortage of inventory in both Hunterdon and Somerset county in our more popular price points and locations. This is holding back sales which would lead to more sales as sellers move up or right size.

Hunterdon County

Net-Net

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

  • Still low-interest rates
  • Much pent-up demand
  • An active market with increasing prices in the more popular price points and locations
  • High consumer confidence
  • We have an acute shortage off inventory

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 Logo
 


USAA members and their families can receive a substantial reduction on their next real estate transaction.

USAA Logo


 

 

Real Estate Market Update Report Somerset County NJ

Somerset County’s Real Estate Market Conditions | January of 2018

Somerset County’s Real Estate Market Conditions | January of 2018

Real Estate Market Conditions

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 75 days on the market. 270 properties went “under contract” in December, down from 307 in the prior month. Newly listed properties in the same period totaled 183.

Somerset County Inventory Breakdown by Price for last month:

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:

  • 69 % of sales in houses < $500,000
  • 22 %of sales in houses > $500,000 and < $1,000,000
  • 09 % percent of total sales (or 15 in total) in houses >$1,000,000

Somerset County Inventory Breakdown by Municipality for last month.

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
  • Rocky Hill

Three areas reported one or two sales each last month:

  • Peapack/Gladstone
  • Raritan
  • S Bound Brook

Hotspots:

  • Bernards – 24 sales
  • Bridgewater – 33 sales
  • Franklin – 51 sales
  • Hillsborough – 33 sales
  • Montgomery – 16 sales
  • N Plainfield – 31 sales

These hotspot areas equaled 69% of the sales last month. The average new listing coming on the market last month neared $561,667 The average price of a unit going “under contract” neared $435,911 (22% 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. Plus, we can now tell you where people are moving in to your area from and market to that area directly. Houses priced and marketed accurately sell fast, especially with a real estate industry veteran and local expert helping you navigate the process.

 

New Jersey’s Economic Drivers:

New Jersey Home Sales:

Home purchase demand increased by 5% in New Jersey during November giving the state its 7th consecutive month of increases. (These numbers run a month behind).  The same number were about 9% in 2016.

New Jersey experienced a compounded growth rate of 17% 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. There has also been some improvement at the very high end in towns where rail service to Manhattan is available.

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, ~37,000 fewer (-50%) homes are on the market compared to the 2011 peak.

Current unsold inventory in New Jersey sits at just under 4.4 months vs. 5.4 months from a year ago.

We have an acute shortage of inventory in both Hunterdon and Somerset county in our more popular price points and locations.

Hunterdon County has ~18% less inventory, and Somerset County also has ~ 16% less inventory than a year ago.

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

Interest Rates:

Interest rates at the end of December rose slightly to a level of just over 3.98% for a 30-year conventional mortgage. A fifteen-year conventional mortgage rests at just under the 3.4% range. Five and seven-year arms are just under the 3.5% 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 to be nearly 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 2,100,000 jobs in 2017 leave us at  -5% from 2016.

  • The national U-3 unemployment rate stands at 4.1% (the lowest in over forty years)
  • U-6 unemployment rate stands at 8%

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 5.1%, 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 39,000 jobs this year vs. 59,000 being added in 2016 (- 34%).

Thru November, 33,000 additional jobs were added YTD vs. 50,900 for the same period last year.

It should be noted that even though these numbers are somewhat 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 central New Jersey rest at 2.4%, the lowest in the state (which is at 4.2%) and the 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 62%.  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 3.8%, 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 -4%, putting pressure home prices in concentrated areas.

Tax cuts and Jobs Act effect:

There are two specific areas that are evident:

  1. State and Local Taxes (SALT) have been limited to a $10,000 deduction going forward.
  2. Mortgage and Interest Deductions (MID) has been limited to a maximum principal balance of $750,000.

Although it is too early to tell how these 2 areas will impact real estate values in New Jersey, they are sure to have some impact. This is based on our state being one of the highest taxed states in the union and our home values being some of the highest. How this affects each of us on an individual basis needs to be better understood as there are some trade-off such as higher deductions.

In a nutshell too early to tell…

 Real Estate Market Recap

  • Consumer confidence is extremely 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 ~ nearly 5% in the more popular price points with ideal locations.
  • 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.
  • Also, there is some confidence that the new tax and jobs act will stimulate the economy with more jobs.
  • We have an acute shortage of inventory in both Hunterdon and Somerset county in our more popular price points and locations. This is holding back sales which would lead to more sales as sellers move up or right size.

Somerset County

Net-Net

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

  • Still low-interest rates
  • Much pent-up demand
  • Anactive 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.

 


Presented as a public service by:

Joe Peters Logo
 


USAA members and their families can receive a substantial reduction on their next real estate transaction.

USAA Logo


 

 

Real Estate Market Update Hunterdon County, NJ

Hunterdon County’s Real Estate Market Conditions | December of 2017

Hunterdon County’s Real Estate Market Conditions | December of 2017

Monthly Market Update Newsletter Banner

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

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

  1. Clinton Township
  2. Flemington
  3. Raritan Township
  4. Readington Township
  5. Clinton

Based on the last full month’s contract sales, statistics show a supply of approximately five months. Normal market conditions average four to six months in Hunterdon County.  Units sold averaged 67 days on the market. 140 properties went “under contract” in November, down from 162 in the prior month. Newly listed properties in the same period totaled 147.

Hunterdon County Inventory Breakdown by Price | November:

New Listings Under Contract Active Listings Month’s Supply
Condos/Town Houses * 42 34 131 4
Over 55 Communities * 9 8 18 2
$000K to $199K 23 27 106 4
$200K to $299K 28 24 119 5
$300K to $399K 33 41 126 3
$400K to $499K 16 24 98 4
$500K to $599K 21 9 102 11
$600K to $699K 10 8 82 10
$700K to $799K 6 2 42 21
$800K to $899K 2 1 19 19
$900K to $999K 3 1 23 23
$1,000K and Up 5 3 63 21
Totals for November 147 140 780 6
Average Price $542,327 $375,793 -30.7%
Average DOM 67
* Included in $ breakdowns

83 % of sales in houses < $500,000

Hunterdon County Sales Breakdown Overview:

  • 17 %of sales in houses > $500,000
  • 5% percent of total sales (or 9 in total) in houses >$700,000

Hunterdon County Inventory Breakdown by Municipality | November

Active Listings Under Contract Month’s Supply
Alexandria Twp. 34 6 6
Bethlehem Twp. 20 3 7
Bloomsbury Boro. 7 0
Califon Boro. 6 1 6
Clinton Town 16 3 5
Clinton Twp. 72 9 8
Delaware Twp. 37 0
East Amwell Twp. 32 6 5
Flemington Boro. 17 1 17
Franklin Twp. 27 6 5
Frenchtown Boro. 26 1 26
Glen Gardner Boro. 15 1 15
Hampton Boro 11 4 3
High Bridge Boro. 21 6 4
Holland twp. 27 4 7
Kingwood Twp. 20 8 3
Lambertville City 18 9 2
Lebanon Boro. 3 4 1
Lebanon Twp. 36 4 9
Milford Boro. 9 0
RaritanTwp. 123 26 5
Readington Twp. 83 23 4
Stockton Boro. 1 0
Tewksbury Twp. 74 9 8
Union Twp. 35 5 7
West Amwell Twp. 10 1 10
Totals 780 140

Four areas in Hunterdon County reported no sales in the past month:

Hunterdon County Sales Breakdown Detailed:

  • Bloomsbury
  • Delaware
  • Milford
  • Stockton

Six areas reported one or two sales each last month:

  • Bloomsbury
  • Califon
  • Flemington
  • Frenchtown
  • Glen Gardner
  • W. Amwell

Hotspots:

  • Clinton/Clinton Township – 12 sales
  • Raritan Township – 26 sales
  • Readington Township – 23 sales

Hotspot areas equaled 44% of the sales last month. The average new listing coming on the market last month neared $542,327. The average price of a unit going “under contract” neared $375,792 (31% 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.

New Jersey’s Economic Drivers:

New Jersey Home Sales:

Home purchase demand increased by  9% in New Jersey during October 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 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 3.3% 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.

Hunterdon County

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.