THE HOUSING MARKET IN NORTHERN NEW JERSEY
by Fran Lichtman
Home sales in NJ were a booming 132,000 for 2020 which is the highest number EVER! Second to that was 119,000 homes sold in 2019. We expect 2021 to perhaps beat that 2020 number by a small amount. Prices rose 11% overall during 2020 and probably closer to 12-15% in this area.
Starting off 2021 we are actually seeing a slight drop in the number of contracts as compared to last year but a lot of that is due to the tightness of the inventory. We expect the market to remain strong with prices continuing to increase but at a slower pace. As we move further out of COVID, we expect that more people will begin putting their homes on the market which will make the home buying process a bit easier for the public.
The Millennials are out there in force making up about 72% of the buyer pool. With the job market and the economy strengthening, we expect to see mortgage rates slowly begin to rise. While the competition out there is brutal, it is a great time to buy in terms of “buying power”. When rates are low enough to make the home you want accessible, it is best to pull the trigger and make that purchase.
Every 1 point increase in interest rates reduces your buying power by 9-11%. In short, what you can afford in payments today may not exist one year from now. We have become accustomed to low interest rates but they may not be here to stay. Some of you may remember that before 2003, interest rates never dipped below 6% and from 1979 –1990 they never went below 10%! I cannot even imagine what the market would look like if that were the case now. And please remember, while the price you offer definitely matters, your terms can also differentiate you from the pack. When the time comes to make that offer we can advise on how to stand out.
IF YOU ARE CONSIDERING A SALE OF YOUR HOME, TALK TO US NOW TO HELP YOU CREATE A PLAN TO MOVE FORWARD. WE CAN ALSO HELP YOU TO ANSWER THE ‘BUT WHERE WOULD WE GO’ QUESTION.
LOCAL MARKET STATISTICS **SINGLE FAMILY HOMES ONLY
ACTIVE TODAY (active 3/5) UNDER CONTRACT SINCE 3/1
MAPLEWOOD 16 (16) 19
SOUTH ORANGE 13 (12) 13
WEST ORANGE 29 (28) 27
MONTCLAIR 24 (21) 17
BLOOMFIELD 29 (21) 30
MILLBURN/SHORT HILLS 55 (37) 24
ORANGE 15 (15) 3
UNION 33 (29) 33
SUMMIT 37 (28) 23