Jeffrey Otteau, New Jersey real estate market analyst, shows in his graph below, that in June contract sales in NJ were higher than June 2008’s pace, signaling a significant break through for our market. The last time NJ home sales have risen for 6 straight months was back in 2003 during the home buying frenzy fueled by the sub-prime lending boom. The monthly sales pace in NJ has increased 115% since the beginning of the year.
Clearly many home buyers are taking advantage of these low prices, low interest rates and the first time buyer tax credit , which are all adding to the housing market recovery. The problem for buyers who really want to buy is the lack of inventory right now in our Midtown direct towns. Unsold inventory declined by 600 homes in June primarily due to the 7,500 home sales during the month, causing a rise in demand for good, well priced homes , especially in the entry level market.
So why is inventory so low? I hear many potential sellers say that they are “waiting until the market comes back” – how long will that take and what will the rates be then? Certainly we cant expect the market to increase more than 3-5% a year once we do have a recovery. Today many home owners are in a catch-22 because they need to sell first, yet don’t want to sell without having found their dream home first, which they ultimately miss out on because they aren’t in a position to buy. There are many options that your Realtor can help you with to avoid the catch 22 What can we expect in the next few months?
All signs seem to be pointing to an active fall market - For Sellers, it’s a great opportunity to attract the first time home buyers looking to beat the December 1st deadline of the $8,000 tax credit . I’d love to hear from the mortgage or financial industry experts- how long can interest rates be held this low because once the rates jump, affordability will drop again, and the market will most likely be at another stand still.
Maplewood, Short Hills, South Orange, Summit, and Millburn real estate and homes for sale in New Jersey - Robert Northfield, Realtor
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