Even NJ Hates NJ

Posted in Demographics, Economics, Employment, New Jersey Real Estate, Unrest | 69 Comments

From the Star Ledger:

N.J. residents’ positive feelings about their state hits 35-year low, poll shows

New Jersey and you, imperfect together.

The percentage of New Jersey residents considering their state a good or excellent place to live dropped to a 35-year low, according to a Monmouth poll released Thursday.

The poll said 55 percent had a positive opinion about their state, down from 63 percent in February and the lowest percentage recorded since the question was first asked in 1980. The previous low point was 57 percent in August 2011.

Residents felt differently about their hometowns: 71 percent felt positively, virtually unchanged from 72 percent in February.

“New Jerseyans still like their towns and their neighbors,” said Patrick Murray, director of the Monmouth University Polling Institute in West Long Branch. “They’re just having a hard time with the state as a whole.”

The statewide views lowered the Garden State Quality of Life Index to +18, down from +23 in February. It was last that low in September 2014, and hasn’t dropped below that since September 2010.

Fewer Underwater Homeowners in NJ

Posted in Economics, Housing Recovery, New Jersey Real Estate | 214 Comments

From the Record:

Share of underwater homeowners declines in NJ, US

About one in every seven New Jersey homeowners with mortgages, or 14.6 percent, are “seriously underwater” — owing much more on their mortgages than the home is worth, according to RealtyTrac, a California real-estate information company.

That’s down from 19 percent, or almost one in every five, in the second quarter of 2014. The drop in seriously underwater properties is the result of a rise in home prices, which is giving homeowners more equity.

Nationally, about 7.7 million homeowners, or 13.3 percent of those with mortgages, are seriously underwater, which RealtyTrac defines as owing at least 25 percent more than the property is worth. The percentage of seriously underwater homeowners has dropped from 17.2 in the second quarter of 2014.

Unsurprisingly, homes bought during the housing boom — when mortgage standards loosened and home prices soared — account for a large share of all those seriously underwater. Nationally, homes owned for seven to 11 years accounted for 38 percent of all seriously underwater properties, RealtyTrac said Wednesday.

Underwater mortgages affect the entire housing market, because people who owe more than their homes are worth can’t sell without taking a loss. That has led to a low inventory of homes for sale, slowing housing activity. In addition, underwater homeowners who struggle to pay their mortgages can’t simply solve their problems by selling the home.

Case Shiller – US Up 4.4% YOY in May

Posted in Economics, Housing Recovery, National Real Estate | 135 Comments

From the WSJ:

Home-Price Growth Remained Solid in May

Home prices made solid gains in May, according to a report released Tuesday, as home price growth appears to be largely flattening out after a long, uneven recovery.

The S&P/Case-Shiller Home Price Index, covering the entire nation, rose 4.4% in the 12 months ended in May, slightly greater than a 4.3% increase in April.

The 10-city and 20-city indexes saw similar increases in May as in April. The 10-city index gained 4.7% from a year earlier, slightly stronger than a 4.6% increase in April. The 20-city index gained 4.9% year-over-year, identical to the increase in April.

Economists surveyed by The Wall Street Journal expected a 5.7% increase to the 20-city index.

Price gains have remained largely flat in 2015 at just over 4%, after low double-digit gains in 2013. Economists said that is likely a good sign that the market is stabilizing closer to levels that most buyers can afford.

David Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices, said that price gains are likely to continue slowing, eventually stabilizing at around 3%.

NJ Building Permits Near 30 Year High

Posted in Economics, New Development, New Jersey Real Estate | 223 Comments

From the Star Ledger:

N.J. home building permits soar to nearly 30-year high

Homebuilders in New Jersey received more permits in June than they had in nearly 30 years, new data shows.

Roughly 4,800 permits were authorized in New Jersey last month, the U.S. Census Bureau reported, an increase of 12 percent from May. Nearly 80 percent of the permits obtained in June were for multifamily projects, the data shows.

Patrick O’Keefe, director of economic research at CohnReznick, said the 4,792 units authorized in June represent the largest number of permits obtained since mid-1988. The 3,776 multifamily units approved in June was the highest level of any month from 1980 forward, he said.

“It was the third consecutive month in which multifamily authorizations reached a historic peak,” O’Keefe said in a memo.

More than 1,000 single-family permits were obtained in June, the Census data shows, a jump of roughly 29 percent over May. June was only the fifth month since the beginning of 2008 that more than 1,000 single-family construction permits were issued, O’Keefe said.

Home prices near peaks across US

Posted in Demographics, Economics, Housing Recovery, National Real Estate | 129 Comments

From HousingWire:

Black Knight: Home prices approach pre-crisis peak

Home prices are approaching their pre-crisis peak, according to a new report from Black Knight Financial Services (BKFS).

Black Knight’s latest Home Price Index report, based on May 2015 residential real estate transactions, showed that the U.S. HPI is now just 6.5% off the June 2006 peak of $268,000, and up over 25% from the market’s bottom.

The Black Knight HPI combines the company’s extensive property and loan-level databases to produce a repeat sales analysis of home prices as of their transaction dates every month for each of more than 18,500 U.S. ZIP codes.

The Black Knight HPI represents the price of non-distressed sales by taking into account price discounts for REO and short sales.

According to Black Knight’s report, the HPI now rests at $251,000, up 1.1% over the previous month and up 5.1% over the previous year.

New York led gains among the states, seeing a 1.8% in month-over-month appreciation.

Of the nation’s 40 largest metros, 12 hit new peaks:

Austin, TX up 1.0% to $279,000
Boston, MA $up 1.5% to 402,000
Columbus, OH up 0.7% to $184,000
Dallas, TX up 1.0% to $211,000
Denver, CO up 1.5% to $318,000
Houston, TX up 0.9% to $215,000
Nashville, TN up 1.2% to $216,000
Pittsburgh, PA up 1.4% to $187,000
Portland, OR up 1.4% to $311,000
San Antonio, TX up 0.8% to $190,000
San Francisco, CA up 1.5% to $713,000
San Jose, CA up 1.1% to $854,000

The top 10 movers on the state level were:

New York: 1.8%
Vermont: 1.6%
New Jersey: 1.6%
Connecticut: 1.6%
New Hampshire: 1.6%
Rhode Island: 1.6%
Pennsylvania: 1.5%
Massachusetts: 1.5%
Oregon: 1.4%
Colorado: 1.4%

Vote for Christie – Get a Tunnel

Posted in Economics, NYC, New Jersey Real Estate, Politics | 51 Comments

From the NYT:

Chris Christie Claims He Will Pursue the Trans-Hudson Tunnel Project as President

Several days of severe delays for rail commuters trying to cross the Hudson River this week has been a painful reminder of the deteriorating state of the tunnels that carry the trains and brought renewed attention to a decision made years ago to halt a project that might have helped improve the situation.

In a radio interview that will be broadcast this weekend, Gov. Chris Christie of New Jersey made clear his reasoning for blocking the construction of a new tunnel and other infrastructure in 2010 that was intended to increase passenger service capacity between his state and Manhattan. He said it was a regional project that would have left New Jersey taxpayers to bear the brunt of its cost.

The governor, a Republican candidate for president, added that if he were to make it to the White House, he would push for an equitable solution.

“If I am president of the United States, I call a meeting between the president, my secretary of transportation, the governor of New York and the governor of New Jersey and say, ‘Listen, if we are all in this even Steven, if we are all going to put in an equal share, then let’s go build these tunnels under the Hudson River,’ ” Mr. Christie said in an interview with the radio talk show host Larry Kudlow, which will be broadcast on Saturday on WABC-AM.

“Then, everyone has an incentive to have the project run right, to run efficiently because everybody is on the hook,” Mr. Christie added.

The governor’s comments — and his hypothetical phrasing — has attracted the attention of his critics, who say his statements emphasize how little he has done to help improve transportation.

“This is not a hypothetical issue, this is a real issue, and he could be doing something about it,” said Martin Robins, the founding director of the Alan M. Voorhees Transportation Center at Rutgers University, who was the director of the tunnel project during the mid-1990s. “The question is, what has he done, what will he do in the next 18 months as the governor of New Jersey?”

Canary?

Posted in Housing Bubble, Housing Recovery, Shore Real Estate | 88 Comments

From Bloomberg:

Hamptons Home Prices Fall as More Sellers List Properties

The real estate market in New York’s Hamptons has cooled from a frenzied pace, with the median sale price in the beachfront towns falling to the lowest in a year and a half.

In the three months through June, Hamptons homes sold for a median of $849,000, down 6.5 percent from the second quarter of 2014, according to a report Thursday by brokerage Douglas Elliman Real Estate and appraiser Miller Samuel Inc. Completed deals in the area, the favored summer retreat of Wall Street financiers, tumbled 16 percent to 590.

More owners are putting their homes on the market after a surge in demand pushed prices to a seven-year high in 2014. Listings at the end of June totaled 1,694, up 2.9 percent from a year earlier and higher than the six-year quarterly average of 1,571, the firms said. With increased choices in most price ranges, shoppers were able to take their time on deals.

“The intensity has slowed a bit,” said Jonathan Miller, president of New York-based Miller Samuel and a Bloomberg View contributor. “Any time you have a pronounced period of growth, which we had in 2014, that pulls in more inventory because sellers say, ‘Hey it’s time to sell.’”

At the current pace of transactions, it would take 8.6 months to sell all the homes on the market, up from 7.1 months at the end of June 2014, the firms said.

Home sales at highest level since 2007

Posted in Housing Recovery, National Real Estate | 103 Comments

From Reuters:

U.S. home sales approach eight-and-a-half-year high, prices surge

U.S. home resales rose in June to their highest level in nearly 8-1/2 years, a sign of pent-up demand that should buoy the housing market recovery and likely keep the Federal Reserve on track to raise interest rates later this year.

The National Association of Realtors said on Wednesday existing home sales increased 3.2 percent to an annual rate of 5.49 million units, the highest level since February 2007.

“The economy really has the wind at its back now,” said Chris Rupkey, chief financial economist at MUFG Union Bank in New York.

Home resales this year are on track to record their biggest gain in eight years, the NAR said.

Economists had forecast sales rising to an annual rate of 5.40 million units last month. Sales were up 9.6 percent from a year ago.

June’s solid home sales report came on the heels of last week’s strong housing starts and building permits data. A tightening labor market is starting to push up wages, helping to boost demand for housing, especially among young adults.

But a tight supply of properties for sale remains a constraint. The string of strong housing reports indicate the economy continues to be on firmer footing despite a drop in retail sales and a slowdown in job growth last month.

“Strong home resale numbers throughout the spring and into summer are welcome news to those who feared the housing market was a weak point in the overall economy,” said Bill Banfield, vice president at Quicken Loans in Detroit.

“As housing numbers trend more positive, the Fed will become increasingly comfortable in beginning to raise rates.”

At June’s sales pace, it would take 5.0 months to clear houses from the market, down from 5.1 months in May. A six-month supply is viewed as a healthy balance between supply and demand.

With supply well below what it was during the housing bubble in 2006, the median price for a previously owned home increased 6.5 percent from a year ago to a record $236,400.

While some buyers may be forced out of the market by higher prices, homeowners are seeing their equity rise. That could lead to more houses being put up for sale. Realtors and economists say insufficient equity has contributed to the tight housing inventories.

Time to clean house? Vote all incumbents out.

Posted in Demographics, Economics, New Development, New Jersey Real Estate | 168 Comments

From the APP:

Where does New Jersey’s job market rank?

Just when you thought it was safe to come out.

New Jersey’s job market, which showed signs of life early this year, slumped in June, leaving the Garden State 36th in job growth nationwide, according to statistics released during the past week.

“I have a feeling this is that pattern of three steps forward, one step back,” said James W. Hughes, an economist and dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University. “It’s not a smooth, even pattern of job growth.”

New Jersey’s rocky path to recovery has grabbed national attention thanks to Gov. Chris Christie’s presidential bid. But there are stronger forces at work.

Perhaps the biggest? New Jersey’s suburban landscape – with isolated corporate campuses, sprawling housing developments, and long, gas-guzzling commutes – was a strength in the ‘80s and ‘90s, but it has fallen out of favor in the new economy, Hughes said.

The giant millennial generation, now in its 20s and 30s, is quickly replacing the baby boom generation in the workplace. It is technically savvy. It prizes teamwork. It doesn’t mind mass transit. It can work any time of the day. And employers are following them, Hughes said.

The shift has prompted New Jersey business groups and entrepreneurs to call on the state to adapt – whether to fix the crumbling transportation network or finds ways employers can partner with high schools and colleges to convince talented students to stay in New Jersey.

“The paradigm shift is, let’s forget about the blame game,” Tom Bracken, president of the New Jersey Chamber of Commerce, said during a recent interview. “Let’s forget about having 15 hearings on the (depleted) transportation trust fund; what else do you need to know? Let’s talk about hearings and meetings where we have solutions and identify the real problems that we need to address, and find ways to start working on those problems.”

Everyone wants out?

Posted in Economics, Employment, New Jersey Real Estate | 150 Comments

From the Star Ledger:

14 percent of N.J. businesses thinking of moving out of state

The New Jersey Chamber of Commerce’s biannual Baker Tilly Spring Economic Outlook Survey brings grim news for the state’s lagging employment prospects: Fourteen percent of those surveyed said they were currently considering moving their businesses out of New Jersey.

Ten of the 14 business leaders considering relocating their businesses blamed high taxes or high cost of living as their reason. Just four cited opportunities elsewhere.

“It is no surprise that high taxes are at the top of the list,” said Tom Bracken, president and CEO of the New Jersey Chamber of Commerce.

“New Jersey-based corporations pay a 9.4 percent tax rate, one of the highest in the country. Despite that, some in the state Legislature last month proposed increasing the corporate tax rate again to 10.75 percent. We fought hard against it and thankfully Gov. Christie vetoed it.”

There was also some good news in the Baker Tilly survey, which consults 100 Garden State business owners, CEOs and senior executives. More than four out of 10 respondents (42 percent) said they expect the state’s economy to improve over the next 12 months, while only 16 percent said they expect it to worsen. This is an improved outlook from survey results a year ago, when only 35 percent of respondents said they expected the economy to improve, while 26 percent said they expected it would worsen.

And large majority of respondents — 82 percent — said they expect their companies will either maintain or increase their staffing levels over the next 12 months. Some 77 percent of the respondents said they expect their companies’ revenue to stay even or increase.

In-depth look into NJ’s foreclosure situation

Posted in Foreclosures, New Jersey Real Estate, Risky Lending | 118 Comments

From the Record:

Fuller impact of home foreclosure debacle hits N.J.

The number of New Jersey home repossessions by lenders has soared in the past two years and is on track to increase again in 2015, in sharp divergence to the national trend.

Completed foreclosures, where banks and mortgage companies have taken the homes, climbed 34 percent in the state last year, to about 5,780, after an 11 percent surge in 2013, according to The Record’s analysis of RealtyTrac data. By contrast, on the national level, completed foreclosures fell by double digits in each of the past three years.

In the first three months of this year, Bergen County was on pace to nearly double last year’s total of sheriff’s auction sales with 201 properties sold.

A CoreLogic report released Tuesday showed that in May 4.9 percent of mortgaged homes in New Jersey were completed foreclosures, the top rate in the country. The percentage of homes where the mortgages are seriously delinquent also was the highest at 8.4 percent.

The statistics indicate the foreclosure debacle, which has eased in other states following the housing meltdown that began in 2007, may only now be peaking in New Jersey, where foreclosures had been crawling through the system.

The reasons for the slow processing include a state judiciary that has tried harder than other states to hold banks accountable for illegal and improper paperwork. Also, New Jersey’s non-profit housing groups, which have support in the state Legislature, have worked to help keep homeowners in their homes. It has taken debt collectors about two years and 10 months on average from the time an initial notice is delivered until the property is repossessed, according to real estate information company RealtyTrac. Only Hawaii’s process is longer.

Now repossessions are moving faster. According to housing activists and lawyers who defend homeowners faced with foreclosure, the acceleration has coincided with a pickup in the real estate market. Although bankers deny it, homeowner advocates say that uptick seems to have made banks more eager to complete foreclosures, cash out and recover what they can from their losses.

“There have been secondary-market buyers coming in as a reaction to the housing market starting to rebound a bit,” said Adam Deutsch, a lawyer with Denbeaux & Denbeaux in Westwood, which has defended hundreds of New Jersey homeowners in contested foreclosures.

New Jersey has throughout the foreclosure debacle had a lower home-repossession rate than most states when measured as a percentage of the total number of homes. Last year, for example, the state ranked 30th, with about one in 350 homes going all the way through the repossession process, according to an analysis of RealtyTrac data. Nationwide, the rate in 2014 was about one in 225 homes.

Bankers tend to blame the courts, lawmakers and housing activists for the state’s inability to clean up its foreclosure mess in a timely fashion. They say homeowner assistance programs have delayed the inevitable.

“This [surge in repossessions] represents the ones that should have been completed years ago,” said Michael Affuso, director of government relations for the New Jersey Bankers Association.

Homeowners facing foreclosure often stay in their homes without making any mortgage payments for years as the process drags on, partly because lenders refuse to accept partial payments once a loan is in default.

But it’s not a free ride for the homeowner. Missed interest payments and late fees, as well as arrears in taxes and insurance, typically are added to what is owed.

Bankers are reluctant to speak on the record about their foreclosure practices. “It is a politically sensitive and customer-sensitive issue,” one industry veteran said. But regulatory filings by publicly traded lenders offer some insight into the effect the surge in homeowner defaults has had on these companies.

Homes in foreclosure continue to be a drag on New Jersey’s housing recovery, and the sooner they are sold to buyers who want to live in them, or to investors who want to resell them or rent them, the better, said the New Jersey Bankers Association’s Affuso.

“This is a nightmare for a bank,” Affuso said. “They’ve already written the loans down and they want to get rid of them.”

Even so, there were nearly 49,000 new foreclosure complaints filed statewide last year, the most since 2010, according to data from the Office of Foreclosure. The counties with the highest numbers last year were Essex, Camden, Ocean, Middlesex and Bergen, in that order.

“It’s a difficult situation,” Affuso said. “We are closer to the next recession than we are from the last recession and there are still about 85,000 properties in foreclosure, and probably 40 percent are older than 2013.”

Hammers start swinging again

Posted in Housing Recovery, National Real Estate, New Development | 26 Comments

From Bloomberg:

Housing Starts in U.S. Surge to Second-Highest Level Since 2007

New-home construction in the U.S. climbed in June to the second-highest level since November 2007 as builders stepped up work on apartment projects.

Housing starts rose 9.8 percent to a 1.17 million annualized rate from a revised 1.07 million in May that was stronger than previously estimated, figures from the Commerce Department showed Friday in Washington. The median estimate of economists surveyed by Bloomberg was a 1.11 million rate. Ground-breaking on multifamily dwellings jumped 29.4 percent.

Building permits for single and multifamily properties, a gauge of future construction, climbed to an almost eight-year high, the report showed. Steady job gains, low mortgage rates and a gradual easing of lending standards are propelling sales, indicating housing will become a bigger source of strength for the economy.

“They’re pretty positive numbers,” said Lewis Alexander, chief economist at Nomura Securities International Inc. in New York. “You’ve got decent employment growth that’s been particularly good for young people, you’ve got relatively low interest rates, somewhat easing of credit standard — all of those things are helping.”

Estimates for housing starts in the Bloomberg survey of 76 economists ranged from 1.03 million to 1.23 million. The May figure was revised up from 1.04 million.

The gain in starts of multifamily homes followed a 16.9 percent decrease the previous month and a 37.5 percent April surge. Data on these projects, which have led housing starts in recent years, can be volatile.

Applications to begin work on single-family projects rose to 687,000 in June, the most since January 2008. Permits for construction of apartments and other multifamily dwellings rose 15.3 percent after a 20 percent jump the previous month.

NJ loses jobs, unemployment rate tumbles to 6.1%

Posted in Economics, Employment, New Jersey Real Estate | 54 Comments

From the Star Ledger:

N.J. sheds 7,400 jobs in June as construction industry shrinks

New Jersey lost more than 7,000 jobs in June with the biggest employment loss posted in the construction industry, according to new labor data released on Thursday.

The state’s unemployment rate, which is measured by a different survey, fell last month to 6.1 percent, its lowest level since October 2008. That’s down from 6.5 percent in May but still above the national rate of 5.3 percent.

A total of 7,400 jobs were lost in June, the data shows, including 5,700 private sector positions.

The construction industry took the biggest hit last month, with a job loss of 4,600, according to the federal data released by the state labor department. Education and health services lost 3,000 jobs in June and 2,700 jobs were eliminated in professional and business services.

The sectors that saw job growth in June include leisure and hospitality, which added 2,000 jobs. The information sector also added 1,900 jobs and manufacturing added 1,600 jobs.

June’s job losses follow a month where the state gained roughly 10,000 jobs. New Jersey has now added 41,600 jobs in total since last June.

Shocking: Expectations between the dumb and the blind don’t align

Posted in Housing Recovery, National Real Estate | 113 Comments

From HousingWire:

Chasm developing between homeowner, appraiser opinions

Appraiser home value opinions fell further below homeowner estimates in June, marking the fifth consecutive month of this trend at the national level, according to Quicken Loans.

Appraiser opinions of home values were 1.4% lower than homeowner estimates, according to Quicken Loans’ monthly national Home Price Perception Index.

Quicken Loans’ national Home Value Index (HVI) reported a slight increase of 0.74% in June, with home values increasing in all regions of the country except for the South, which posted a decline of 0.09%. National home values are up 4.38% from the year prior.

June marks the fifth consecutive month appraisers have estimated home values below homeowner estimates. During this five-month period, the gap between homeowner and appraiser estimates has increased each month, with an average 1.4% difference in June.

“Over the last five months we’ve seen homeowners continually value their homes higher than appraisers,” said Bob Walters, Quicken Loans chief economist. “While each local market has a different story to tell, a large part of this perception gap is likely due to the normalization of home prices. After about a year of home values trending upward, it takes some time for many homeowners to realize home values are stabilizing in their neighborhoods.”

“Home prices seem to be a bit frozen for the time being – validating that we are in a market that is well into the stabilization cycle,” said Walters. “The real test for home price solidity will be when inventory increases to a level of equilibrium between supply and demand.”

Lonely at the top

Posted in Foreclosures, Housing Recovery, New Jersey Real Estate | 138 Comments

From the Star Ledger:

N.J. has largest share of homes in foreclosure, report shows

A greater share of homes in New Jersey are facing foreclosure than anywhere else in the country, according to a report released Tuesday morning.

The report from the Irvine, Calif.-based firm CoreLogic shows 4.9 percent of mortgaged homes in New Jersey were in the foreclosure process in May, which is nearly quadruple the national rate of 1.3 percent. In May 2014, 5.8 percent of mortgaged homes in New Jersey were in foreclosure, compared to 1.7 percent of homes nationwide.

New Jersey has been dealing with a backlog of foreclosures, which are slowly winding their way through the state’s judicial process.

New York (3.7 percent), Florida (2.9 percent), Hawaii (2.5 percent) and the District of Columbia (2.4 percent) also have among the highest foreclosure rates in the nation, according the CoreLogic report.

Roughly 9,200 foreclosures were completed in New Jersey over the last year, according to the report, up from more than 6,300 completed foreclosure in the year ending in May 2014. That’s counter to the national trend. The number of completed foreclosures declined between those time frames 595,000 to roughly 528,000.