The Cost of Waiting to Buy a House: Interest Rates Edition

The Cost of Waiting to Buy a House: Interest Rates Edition

Some Highlights:

  • Interest rates are projected to increase steadily heading into 2019.
  • The higher your interest rate, the more money you end up paying for your home and the higher your monthly payment will be.
  • Rates are still low right now – don’t wait until they hit 5% to start searching for your dream home! 


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Housing Market: Another Gigantic Difference Between 2008 and 2018 in Hunterdon and Somerset Counties

Housing Market: Another Gigantic Difference Between 2008 and 2018 in Hunterdon and Somerset Counties

Some are attempting to compare the current housing market to the market leading up to the “boom and bust” that we experienced a decade ago. They look at price appreciation and conclude that we are on a similar trajectory, speeding toward another housing crisis.

However, there is a major difference between the two markets. Last decade, while demand was being artificially created by extremely loose lending standards, a tremendous amount of inventory was coming to the market to satisfy that demand. Below is a graph of the inventory of homes available for sale leading up to the 2008 crash.

 

Housing Market: Another Gigantic Difference Between 2008 and 2018 | MyKCM

A normal market should have approximately 6 months supply of housing inventory. As we can see, that number jumped to over 11 months supply leading up to the housing crisis. When questionable mortgage practices ceased, and demand dried up, there was a glut of inventory on the market which caused prices to drop as there was too much supply and not enough demand.

Today is radically different!

There are those who believe that low mortgage rates have created an artificial demand in the current market. They fear that if mortgage rates continue to rise, some of the current demand will dry up (which is a possibility).

However, if we look at supply again, we can see that the current supply of homes is well below the norm of 6 months.

Housing Market: Another Gigantic Difference Between 2008 and 2018 | MyKCM

Bottom Line

We will not have a glut of inventory like we did back in 2008 and home values won’t come tumbling down. Instead, if demand weakens, we will return to a normal market (approximately a 6-month supply) with historic levels of appreciation (3.6% annually).

 

 


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Are You Thinking of Selling Your Home in Hunterdon or Somerset County? Competition Is Coming!

Are You Thinking of Selling Your Home in Hunterdon or Somerset County? Competition Is Coming!

The number of building permits issued for single-family homes is the best indicator of how many newly built homes will rise over the next few months. According to the latest U.S. Census Bureau and U.S. Department of Housing & Urban Development Residential Sales Report, the number of building permits issued in June was 850,000, a 0.8% increase from May.

How will this impact buyers?

More inventory means more options. Mark Fleming, First American’s Chief Economist, explained that this is good news for the housing market – especially for those looking to buy:

“The continued year-over-year growth in completions means more homes on the market in the short-term, offering some immediate relief in alleviating housing supply shortages.”

How will this impact sellers?

More inventory means more competition. Today, because of the tremendous lack of inventory, a seller can expect:

  1. A great price on their home as buyers outbid each other for it.
  2. A quick sale as buyers have such little inventory to choose from.
  3. Fewer hassles as buyers don’t want to “rock the boat” on the deal.

Bottom Line

If you are considering selling your house, you’ll want to beat this new competition to market to ensure that you get the most attention on your listing and the best price for your house.

 

 


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NJ SCHOOLS RANKED #2 IN THE COUNTRY

– NJ SCHOOLS RANKED #2 IN THE COUNTRY –

Niche.com Ranked BEST SCHOOLS IN NJ RANKING 8/6/18

  1. Millburn Township Schools
  2. Princeton Public Schools
  3. West Windsor-Plainsboro Regional School District
  4. Summit Public Schools
  5. Livingston Public Schools
  6. School District Chatham
  7. Bernards Township School District
  8. Tenafly Public Schools
  9. Mountain Lakes School District
  10. Haddonfield Public Schools
  11. Fair Lawn School District
  12. Glen Ridge Public Schools
  13. Moorestown Township Public School District
  14. South Brunswick Public Schools
  15. Westfield Public Schools
  16. Hopewell Valley Regional School District, Pennington
  17. Montgomery Township School District
  18. Ridgewood Public Schools
  19. East Brunswick Public Schools
  20. Berkeley Heights Public Schools
  21. Montclair Public Schools
  22. Hillsborough Township Public School District
  23. Edison Township Public Schools
  24. Mahwah Township Public Schools
  25. Northern Valley Regional High School District, Demarest
  26. West Essex Regional School District, North Caldwell
  27. Ramsey Public Schools
  28. Cranford Public School District
  29. Glen Rock Board of Education
  30. Madison Public Schools
  31. Bridgewater-Raritan Regional School District, Martinsville
  32. Holmdel Township School District
  33. Somerset Hills Regional School District, Bernardsville
  34. Pascack Valley Regional High School District, Montvale
  35. Scotch Plains-Fanwood School District
  36. Pompton Lakes School District
  37. Parsippany-Troy Hills Township Schools
  38. Mount Olive Township School District, Flanders
  39. Randolph Township Schools
  40. Ocean City School District
  41. River Dell Regional School District
  42. New Providence School District
  43. Upper Freehold Regional School District
  44. Paramus Public Schools
  45. Wayne Township Public Schools
  46. Highland Park Board of Education
  47. Robbinsville Public Schools
  48. Leonia Public Schools
  49. West Morris Regional High School District, Chester
  50. Lawrence Township Public Schools
  51. Rutherford Public Schools
  52. Kinnelon Board of Education
  53. Dumont Board of Education
  54. Monroe Township School District
  55. Bergenfield Borough School District
  56. North Hunterdon-Voorhees Regional High School District,      Annandale
  57. Sparta Township Public Schools
  58. West Orange Public Schools
  59. Metuchen Public Schools
  60. Somerville Public Schools
  61. Montville Township School District
  62. Point Pleasant Beach Board of Education
  63. Morris School District
  64. Ramapo Indian Hills Regional High School District, Oakland
  65. Old Bridge Township School District
  66. Lenape Regional High School District, Shamong
  67. Egg Harbor Township School District
  68. Cresskill Public School District
  69. Cinnaminson Township Public Schools
  70. Roxbury Township Public Schools
  71. Springfield Public Schools
  72. South Orange-Maplewood School District
  73. Washington Township Public Schools, Sewell
  74. Morris Hills Regional School District, Denville
  75. Matawan-Aberdeen Regional School District
  76. Middletown Township Public Schools
  77. Clearview Regional High School District
  78. Westwood Regional School District
  79. Cherry Hill Public Schools
  80. Delsea Regional High School District
  81. Freehold Regional High School District
  82. Woodstown-Pilesgrove Regional School District
  83. Piscataway Township Schools
  84. Hanover Park Regional High School District
  85. Manasquan School District
  86. Fort Lee Public Schools
  87. Southern Regional School District, Manahawkin
  88. Wall Township Public Schools
  89. Weehawken Board of Education
  90. Point Pleasant Boro Board of Education
  91. Secaucus Board of Education
  92. New Milford School District
  93. Park Ridge Public Schools
  94. Caldwell-West Caldwell Public Schools
  95. Northern Burlington County Regional School District, Columbus
  96. Roselle Park Board of Education
  97. Midland Park Public Schools
  98. Waldwick School District
  99. Woodbridge Township School District
  100. Hasbrouck Heights Board of Education

According to Niche, the Jericho Union Free School District in Jericho, New York, is the best school district in the country overall.

With an overall Niche grade of A+, the district received a grade of A+ in academics, teachers, clubs and activities, college prep and health and safety. In the category of diversity, Niche awarded the school district a B+.

 


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The Wave of Millennial Homebuyers Continues to Swell Across Hunterdon and Somerset Counties

The Wave of Millennial Homebuyers Continues to Swell Across Hunterdon and Somerset Counties

Many have written about the millennial generation and whether or not they, as a whole, believe in homeownership as a part of attaining their American Dream.

Comparatively speaking, millennials have taken longer to obtain traditional milestones (like getting married, having kids and buying a home) than generations before them, but that does not mean that they do not aspire to still achieve those things.

For older millennials (aged 25-34) who have established themselves in their career and are starting to build their families, homeownership is the next logical choice.

According to the Urban Institute’s State of Millennial Housing, the probability of a millennial becoming a homeowner increases by 17.9% if they are married, and by an additional 6.2% if they have children.

Last year, according to the US Census Bureau, the average age at first marriage was 30 for men and 27 for women, while the National Association of Realtors (NAR) reports that the average first-time homebuyer was 32 years old.

With most of this generation having yet to age into the ‘Responsibility Zone’ (the time in their lives when their responsibilities start to dictate their behaviors), there will be a steady wave of buyers for years to come!

Those who are currently out in the market searching for a home are being met with a strong, highly competitive seller’s market. NAR’s Chief Economist Lawrence Yun recently commented,

“Realtors® throughout the country continue to stress that there’s considerable pent-up demand for buying a home among the millennial households in their market.  

Unfortunately, they’re just not making meaningful ground, and continue to be held back by too few choices in their price range, and thereby missing out on homeownership and wealth gains.”

Bottom Line

If you are currently renting and thinking about jumping into the real estate market this year, let’s get together to help you navigate our market.

 

 


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