The Top Ten Events in Somerset County, NJ This Weekend October 18 – 20, 2019

 

 

Presented as a public service by Joe Peters of Coldwell Banker

The Top Ten Events in Somerset County, NJ This Weekend October 18 – 20, 2019

  1. Creature Fest, Duke Farms
  2. Fall Festival, Lord Stirling Stable
  3. Good Libations, The Center for Contemporary Art
  4. Spooky Skies, RVCC Planetatrium
  5. Purina Regional VIP Show Jumping Clinic, USET
  6. New Jersey Paranormal Investigators, Abraham Staats House
  7. Brite Nights, Wagner Farm Arboretum
  8. Reclaiming our Voice, Rockingham Historic Site
  9. Far Hills Race Meeting, Moorland Farm

10. NJ Audubon: Fall Foliage and Tree I.D., Scherman Hoffman Wildlife Sanctuary


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The Top Ten Events in Somerset County, NJ This Weekend October 11 – 13, 2019

 

 

Presented as a public service by Joe Peters of Coldwell Banker

The Top Ten Events in Somerset County, NJ This Weekend October 11 – 13, 2019

  1. Weekend Journey Through the Past, Throughout Somerset County
  2. Somerset County Diversity Festival, County Administration Building
  3. 40th Annual Old Fashioned Country Fair, Fairview Farm Wildlife Preserve
  4. Owl Prowl, Duke Farms
  5. Around the World Tasting Experience, The Bernards Inn
  6. Canal Watch 2020 Calendar Reception, Blackwells Mills Canal House Association
  7. Into the Woods, Jr., Villagers Theatre
  8. Black Holes, Raritan Valley Community College Planetarium
  9. “By the Light of the Moon”, Somerset County Environmental Education Center

10. Brite Nights – Opening Weekend, Wagner Farm Arboretum


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Somerset County's Real Estate Market Conditions October 2019

Somerset County’s Real Estate Market Conditions October 2019

Residential Real Estate

Somerset County's Real Estate Market Conditions October 2019

Somerset County’s Real Estate Market Conditions October 2019

Get ahead of the residential real estate market drivers in Somerset County, New Jersey, with Coldwell Banker Residential Broker sales associate, Joe Peters. Joe’s monthly report walks people through the economic conditions and trends that influence our local markets.  You will come away knowing what is happening and, more importantly, why it is happening. As a result, you will be better informed to make home buying and selling decisions.

What is happening

Based on the last full month’s contract sales, statistics show a supply of approximately four months, indicating a seller’s market. Normal market conditions average four to six months in Somerset County.  Units going under contract averaged 62 days on the market. 332 properties went “under contract” in September compared to 434 in the prior month. Newly listed properties in the same period totaled 459.

Somerset County Inventory Breakdown By Price For Last Month:

September September Total  
Somerset County New Under Active Months’
Listings Contract Listings Supply
Condos/Town Houses * 156 121 431 4
Over 55 Communities* 15 14 61 4
$000K to $199K 13 24 48 2
$200K to $299K 72 84 169 2
$300K to $399K 90 75 231 3
$400K to $499K 62 43 190 4
$500K to $599K 43 34 156 5
$600K to $699K 33 18 119 7
$700K to $799K 45 10 122 12
$800K to $899K 28 17 84 5
$900K to $999K 24 14 74 5
$1,000K and Up 49 13 199 15
Totals for September 459 332 1392 4
Average Price $608,936 $468,784 -23.0%  
Average Days on Market 62
* Included in $ breakdowns
  • 52% of sales in houses < $500,000
  • 38% of sales in houses > $500,000 and < $1,000,000
  • 10% percent of total sales (or 13 in total) in houses >$1,000,000

Somerset County Inventory Breakdown By Municipality For Last Month:

Municipality Active Listings Under Contract in Last Month Months Supply
Bedminster Twp 68 13 5
Bernards Twp 161 41 4
Bernardsville 96 8 12
Bound Brook 15 4 4
Branchburg Twp 85 13 7
Bridgewater Twp 170 50 3
Far Hills Boro 12 0
Franklin Twp 179 63 3
Green Brook 31 7 4
Hillsborough 136 43 3
Manville Boro 24 13 2
Millstone Boro 5 0
Montgomery Twp 144 18 8
North Plainfield 48 19 3
Peapack Gladstone 24 0
Raritan Boro 11 2 6
Rocky Hill Boro 4 0
Somerville Boro 23 10 2
South Bound Brook 14 11 1
Warren Twp 97 16 6
Watchung Boro 45 1 45
Totals 1392 332 4

Only four areas in Somerset County reported no sales in the past month

  • Far Hills
  • Peapack/Gladstone
  • Rocky Hill
  • Millstone

Two areas reported one or two sales each last month

  • Raritan Boro.
  • Watchung

Hotspots:

  • Bernards – 41 sales
  • Bridgewater – 50 sales
  • Franklin – 63 sales
  • Hillsborough – 43 sales
  • Montgomery – 18 sales

These hotspot areas equaled 65% of the sales last month. The average new listing coming on the market last month neared $508,936 The average price of a unit going “under contract” neared $468,784 (23% less).

Note: To get an accurate price point for your property based on its location and price point, contact me. Coldwell Banker’s big data technology capabilities will put you at a unique advantage. I can show you the latest age and earnings breakdown for your particular area, show you where people are moving into that area from and how I can market to those specific areas and demographics directly. The result is in you receiving the maximum selling price with a shorter time on the market.  Houses priced and marketed accurately sell faster, especially with a real estate industry veteran and local expert, helping you navigate the process.

Why it is happening

New Jersey’s Economic Drivers:

New Jersey Home Sales:

The still low inventory numbers lead to a bit of softening in the price appreciation on existing homes and a slowdown in growth. It is turning the tide back to a buyers market (or at least neutralize it to being a normal market).

We saw an increase of 6% in sales in August and year to date; we are ahead of 2018 by 3%.  And, this is not state-wide.  Only 12 of the 21 counties have benefited from an increase in sales.

Increases in inventory have occurred in all price points above $400,000 with the $400,000 to $600,000 range seeing the largest jump (+9%) followed by the $600,000+ with a slight increase.

The under $400,000 range saw a 9% drop n inventory.

Activity still concentrates in the under $400,000 market where Millennial buyers are transitioning into homeownership.  But, this price point only saw only a slight increase vs. 2018 YTD due to lack of inventory.  The $400 to $600K range also saw a nearly 900 increase in units sold YTD while dropping 22z% in inventory levels.

During the same period, all housing sales above $400,000 and below $1 million showed very modest increases showing confidence in the changes made on taxes and deregulation. There has also been an improvement at the very high-end in towns where rail service to Manhattan is available.  Houses above $1 million showed a small increase as well.

At the same time, the number of homes offered for sale in New Jersey remained low. Currently, ~31,000 fewer homes (-45%) are on the market compared to the 2011 peak.

Current unsold inventory in New Jersey varies widely by county with only 3.0 months in some and none being above 8.0.  The state is averaging just under four months.

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

Hunterdon and Somerset County have about 2% & 8% less inventory than we had a year ago, respectively, and the inventory is 2% more in Hunterdon & 11% less in Somerset as compared to 2 years ago.

The market has changed from a seller’s to a buyer’s market above $500K due to the additional inventory coming on to the market.

Also, we are now seeing some millennials coming back into our local markets and buying homes (good news).

 

Interest Rates:

Interest rates have risen slightly over the last month.

The economy is strengthening, and Interest rates have fallen in recent weeks to just over 3.65% for a 30-year conventional mortgage. A fifteen-year conventional mortgage rests at just over the 3.15%  mark. Five-year arms are just under the 3.38% range.

Consumer fears of further rises in interest rates and slowly rising home prices are driving the current market demand. The Fed has made several downward adjustments, and more may still be in order.

The fear of increasing interest rates, coupled with steadily increases in prices, is still driving the current market activity.

 

National Job Front:

On the national level, the US added over 2,700,000+ jobs in 2018.

US unemployment rate in August came in with 130,000 jobs added.  And unemployment remained at 3.7%.

As of the end of August, the US had added a little over 1.3 million jobs vs. around 1.9 million the prior year.

At this rate, they are predicting 1.6 million jobs will be added by year-end.

At the end of August, there were 7.2+ million openings compared to nearly 6.1 million unemployed persons.

 

New Jersey Job Front:

NJ added 39,000+ jobs in 2018 as compared to 47,100 for the same period in 2017.

The NJ unemployment rate fell to 3.2% (the lowest it has been on over ten years), bolstering consumer confidence in NJ as well.  In effect, NJ is rising with the national tide of nearly full employment.   Based on the first eight month’s results, 2019, the state has added 21,000+ jobs in 2019 vs. only 14,000+ for the same period in the prior year.

The level of jobs created has been at consistently higher levels than in the past several years (a silver lining as these additions to our job market will be able to afford to buy houses eventually).

It also should be noted that these jobs are mostly in the northern half of the state.

 

Rental Market Trends:

We have seen an 11 year high in rental availability,

Rental prices in New Jersey rose nearly 5% in 2018, averaging just over $1,600 per unit. Current vacancy rates in New Jersey have fallen to 2.7% in central NJ.

The drop in New Jersey’s homeownership contributes to rental demand.  A 12+ year trend shows a decrease from  71% to 66%.  This 7% decrease compared to an 8% national decrease contributes to the slower recovery of home prices in the state and adds over 20,000+ additional renters in our state. However, the 71% level resulted from the loose lending standards of the early 2000s and is actually at a good level.  Households with no children stand at 65%, reflecting the decline in our school population.

One article states that the average homeowner who is 65+ has an average net wealth of over $318K, while the same for a renter is only just under $8K.  It also offers a stable place to live, an evident hedge against inflation, and a way to build wealth (a strong argument for homeownership).

However, the number of renters has increased by 7% over the past 25 years, with the less educated leading the way.  And, we are now seeing more educated millennials moving east into higher rent and cost of living areas that eat into their discretionary income (including savings).  It makes one wonder where this all is heading.

The pace of new rental construction has increased to meet this demand and now seems to have caught up.

 

New Jersey Foreclosures:

New Jersey continues to face falling foreclosure rate filings dropped to  2.1%. Other states have begun to, or already have recovered. In a tight real estate market, these foreclosures sell at a small discount.

Note: Figures vary by the local market, especially those walloped by Hurricane Sandy three years ago and rural and urban areas. We rank #5 in the country with 2.1%, led by NY with 2.8%, MS with 2.6% (mostly hurricane-related)  LA with 2.4%, ME with 2.1% and trailed by FL, DE, MD, PA, and AL.  The national baseline number sits at a little under 1.3%.

Foreclosures in NJ in 2018 were the lowest in the state in over four years.  And, 2019 looks to be even better with a forecast of under 41,700 foreclosure filings.

Real Estate Market Recap

Economic conditions:

  • Nationally, 2018 was the eighth straight year of 2 million + job gains.
  • We are now in our longest economic expansion period in America’s history with 100+ months of positive job gains.
  • The GDP is still rising (although its rate of increase seems to be slowing).
  • At 3.3% unemployment, NJ is now near to the national average, which is currently at 3.5% & leading economic indicators in NJ are now surpassing the nation by almost two-fold.
  • The best paying and most attractive jobs are in NYC, pulling many of our millennials in that direction (although this trend is diminishing).
  • And, wages are up 3.2% at the same time.
  • Interest rates have dropped to surprising lows of under 3.65% since the first of the year.
  • And, house prices have risen around 3+% in the more popular housing price points and areas further exasperating the situation (although this appreciation now appears to be slowing).
  • Baby boomers who were choosing to “stay put’ and update rather than “move up” to their dream house as it is no longer considered a sound investment (and a lot of times inventory is not available) which is causing most of the housing shortage are now finding available inventory.  This situation has loosened up as many new listings have come on the market over the past few months.
  • And there is still little entry-level construction going on in our area, just larger homes and new rentals (only 50% of what it was in 2005).
  • As a result of the previous two points, we are experiencing the current housing inventory shortage (the shelves are empty in our starter housing price points).
  • And, some empty houses are starting to appear at out higher price points.
  • Foreclosures rates continue to decline (or normalize).
  • There is continued confidence that the new tax and jobs act will further stimulate the economy with more jobs as the economy remains robust.

Changes in lifestyle:

  • The average age at marriage is now in the mid to late ’30s (up seven years from just a decade ago).
  • Families usually have only one to two children due to costs and the ability to choose.
  • 70% of all NJ homes have no children of school age, and 50% do not have more than one person in them. This factor minimizes the need for larger housing not only in NJ but everywhere.
  • As a result of job opportunities, buyers are gravitating to areas within 15 miles of NYC with good mass transportation systems.
  • 80% of consumers still perceive homeownership as part of the American Dream.  It is just what they want to buy (or rent) that has changed.
  • Builders have been thinking larger 4 BR center hall colonials on 1+ acre in the country (based mostly on local building codes).
  • Buyers are thinking of smaller luxury hi-rise close to mass transportation and work in the east (truly a mismatch).
  • 60% of all new housing starts in 2018 in NJ were in the rental sector.

Market conditions:

  • We experienced a sales slump in late 2018 due to interest rate hikes. But the first half of 2019 made up for it by being the best we have seen, and the 2nd half is also promising.
  • It appears that we are now entering the next phase of the housing cycle, which is still active, just less robust in price appreciation.  Sort of a cool down from 2018. Or, maybe back to normal.
  • And, we see some warnings of an economic slowdown starting in late 2020 and beyond.
  • However, these warnings are not holding back sales activity.  We may see fewer sales and less price appreciation as a result.
  • The effect on housing is seen to be limited to curtailing the growth of price appreciation and not in any loss in value.
  • But, in general, homeowners are sitting with more equity than ever (NJ reports 95+% with positive equity) and are no longer using their homes as an ATM.  So, the effect of any slowdown on housing should be minimal (if at all).
  • Consumer confidence remains high nation-wide based on the job and stock market increases.
  • Most consumers still see homeownership as a sound investment.
  • There is a bit of offset to this encouraging news from the discord that we see in our national politics and trade policies.
  • This confidence is reflected in buyer traffic being up at open houses.  However, with a lack of inventory in our lower price points, there are fewer houses for sale.
  • Affordability will never be in this good of shape as interest and price increases start to eat into what you can afford.
  • Millennials make up about 35% of our current homeowners with much more room for expansion at the lower end of the market when adequate inventory supply materializes.
  • Central New Jersey’s trend in early 2019 shows an increase in home sales, but price increases only in houses clustered in < $400,000 market where the first-time buyers and Millennials are focused.
  • The >$400K market holds diminishing slightly due to a lack of inventory.  We have additional new inventory in the $400K to $600K range.
  • Minimal new construction, lack of entry-level new housing, and COAH restrictions add additional value to the current inventory.
  • Analysts’ five-year forecast indicates slow but steady price growth (but at reduced rates) at an annual average of 2 to 4% (depending on location and price point).  This price growth will remain higher in the under $400K market. And, little depreciation in pricing is being forecasted except in the higher-end inventory.
  • There is an acute shortage of inventory in both Hunterdon and Somerset County in our more popular price points and locations, holding back even more sales.  In general, we have only about 65% of the inventory that we had in 2011 but are selling current inventory at faster rates.
  • It is simple; we could sell more houses if we had more inventory on hand,  And, as we have started to see small inventory increases over the past six months, 2019 can be a boom for resales.
  • In 2018 prices rose ~ averaging just over 3.5% and depending on price points and locations.  2019 promises to be more normalized with at least a 3% growth in prices.  But it depends on your price point and location. The following two years will also see less in % but should still show modest positive growth.
  • Mortgage delinquency is normalizing.

 

Forecast:

  • The economy will continue to prosper with no recession currently in sight for the next 18  months.  And, there most likely will be only a slowdown impact on the rate of price appreciation if this happens.
  • Prime Interest rates will probably drop further in 2019.  And, we have just seen a slight drop and are anticipating another.
  • Home prices will rise by an average of another 3% during that same period (this will depend on your price point and location), further decreasing buying power. And, the most bullish projections show at least a 7% increase over the next few years.
  • While improving, supply will remain tight in the more popular price points in the residential real estate.
  • Many new jobs seem to be resulting from the Tax and Jobs act (just look at the help wanted signs).
  • For the first time in memory, the US is reporting 7.2+million open jobs and only 6. million unemployed.  We are at full employment if you consider that 3% of unemployed is the normal level.
  • We now need to match the skills of the unemployed to the job openings to prosper further as many four-year degrees currently being obtained, are not useful in the current job market. It has also opened up the need for inward migration of workers to the economy.  In some areas, this is happening via people immigrating from outside of the US to areas with the skills needed to fill open positions.
  • The affordability index shows that there is room for much more sales; all we need an increase in inventory.  The most affordable time to buy appears to be now!.
  • Some high-end fall-out has resulted in the residential real estate from the SALT and mortgage interest changes in the Tax and Jobs act.
  • The commercial real estate market is flourishing as a result of creating more buying demand.
  • People in their home > 10 years have very positive home equity built up, and a more significant portion of payments applies to principle.  Increases in selling prices should eventually motivate people to make changes in their lifestyle by investing in summer homes or even start a new business with the extra equity cash.
  • And, thirty-seven percent of all homes in the US have no mortgage at all.
  • Small investor activity in the market is up.  In many cases, these are flippers buying-low end unsaleable inventory and bringing it up to marketable status.

Note:  Presented as a public service by Joe Peters of Coldwell Banker Residential Brokerage. I took reasonable precautions in 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.

 

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

 

Somerset County's Real Estate Market Conditions October 2019

 

 

The Top Ten Events in Somerset County, NJ This Weekend October 4 – 6, 2019

 

 

Presented as a public service by Joe Peters of Coldwell Banker

The Top Ten Events in Somerset County, NJ This Weekend October 4 – 6, 2019

1. The Lord Stirling 1770s Festival, Environmental Education Center

2. Tour & Tasting, Sky Acres Winery

3. Birding Big Sit, Environmental Education Center

4. Weekend in Gladstone: Tailgating & Horse Racing, Natirar Park

5. Fall Wedding Showcase, Bridgewater Manor

6. Coming Home: Jim Rodgers – Artist Reception, Studio 7 Fine Art Gallery

7. Build Your Own Scarecrow, Colonial Park Gardens Stone Cottage

8. Peony Propagation and Garden Design Workshops, Peony’s Envy

9. Farmers Market, Duke Farms

10. VNA Fall Rummage Sale, Far Hills Fairgrounds


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The Top Ten Events in Somerset County, NJ This Weekend September 26 – September 30, 2019

 

 

Presented as a public service by Joe Peters of Coldwell Banker

The Top Ten Events in Somerset County, NJ This Weekend September 26 – September 30, 2019

  1. 7th Annual Oktoberfest, Tapastre Somerville
  2. Aiken & Friends Fest and RVCC Community Day, Raritan Valley Community College
  3. Franklin Day Festival, Colonial Park
  4. Family Fun Day, Branchburg Sports Complex
  5. Branchburg Country Fair, White Oak Park
  6. Hawkwatch, Somerset County Environmental Education Center
  7. Scare Farm – Opening Night, Norz Hill Farm & Market
  8. National Alpaca Farm Weekend, Hidden Spring Lavender
  9. Downtown Somerville Sidewalk Sale, Downtown Somerville

10. ArtSee Tour, Locations Throughout Bernards Township


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