Q. I’m not sure when I am going to sell my home, this year or next. How can I get information on the current market conditions in northern NJ?
A. This is an excellent question! With so many articles in the media, TV news stories and discussion on this topic everywhere from politicians or business pundits to the latest cocktail party gossip, it’s hard to know whom to rely on for accurate data and analysis. Certainly, you can read up on local market conditions through newspapers, as well as check articles and blog discussions online through various well-regarded nationwide real estate websites (Realtor.com, Trulia.com, Homes.com) or on New Jersey’s local multiple listing website (www.njmls.com), but the best source of information would come from interviewing local realtors. Experienced real estate agents such as I have to keep informed of local market data, and will be happy to share the statistics with you as well as discuss what your home is worth in today’s market.
Q. Can you give me some general market forecasts that can help guide my decision?
A. One of the best real estate market “gurus” is Jeffrey Otteau, who speaks often to hundreds of realtors about the current and future state of the real estate market. His organization, The Otteau Group, studies all kinds of economic factors such as job statistics, local and nationwide economic data, reports from utilities and transportation companies etc. and all the data from multiple listing websites to analyze trends in the real estate marketplace. I was fortunate to attend one of his latest workshops last month, and here are some of the general trends he highlighted:
2016 * Migration close to NYC continues to draw buyers
* Single Family Home Sales still strong in a moderate sellers’ market, will rise about 4%
* First-Time Buyers the strongest market trend, especially among the Millenial Generation
2017 * Interest rates will slowly continue to rise again
* Home prices still rising, but more slowly (especially in upper-income areas)
* Increasing likelihood for next recession due to worldwide economic issues
2018 * Home prices stall as economy loses momentum
* Interest rates approach 6 percent, affecting buyers’ purchasing strengths
* Access to credit begins to tighten
Q. How do these statistics and trends affect the real estate market in my local community?
A. Another good question—it varies from town to town, depending on average sales data, property-tax levels, proximity to public transportation (train and bus) to NYC and other community factors. Your local realtor will have access to more specific data through NJMLS, their local Board of Realtors, and from their own research using websites such as The Otteau Report and nationwide real estate magazines. For instance, The Otteau Report will supply its membership of realtors with data for each specific town in NJ, where trends may vary depending on amount of housing stock, past performance of the marketplace, and the appeal for future homebuyers. If inventory is light in certain price ranges, the sellers are seeing offers close to asking price or even multiple offers. If inventory is heavy, the opposite is true and homes will sit on the market longer before receiving an offer. Location, condition of the home and balance of commercial to residential real estate in each town also play a role in pricing a home correctly.
Q. Seems like a lot of research to digest—how can I understand it all?
A. With the help of your advisors—your accountant, perhaps an attorney, but most certainly local realtors who do considerable business in the community—you now can understand how the asking price of your home is critical to getting a qualified offer in the least amount of time. First-time buyers are out there in droves, looking mainly for either condos in the $100,000–$250,000 price point, or single-family homes from $200,000 to $500,000. Of course there are also other buyers who are ready to consider more expensive, larger homes in many Bergen County communities, but Mr. Otteau has predicted that the inventory glut of large 4–5 BR homes from $600,000 to $2 million will continue to grow, since the desire to “downsize” is not balanced by the number of first-time “Millenial” buyers who are not inclined to overspend at the top of their price range, especially if they want to maintain their currently active lifestyle that enables them to travel, head into the city for entertainment etc. Of course, other factors such as proximity to houses of worship, convenient NYC transportation, shopping etc. can help to support a higher price in some cases. Sellers should keep this trend in mind as they make their future financial plans for retirement and relocate to smaller homes or apartments.
For recommendations, feel free to contact me for more information. I will help you with a comprehensive market analysis (CMA) of your home, answer any questions you have and advise you on how to approach preparing it for sale—now or anytime in the near future!
By Barbara Ostroth
Barbara Ostroth of Coldwell Banker Residential RE, can be reached (201)262-6600 in the office, (201)965-3105 on her cell, or email or visit her on the web at [email protected] and www.BarbaraOstroth.com.