From the Record:
David DeFabiis of Hackensack has been house-hunting for more than a year.
He’s got a good job, a great credit score, a sizable down payment. He’s been prequalified for a mortgage.
But he’s afraid.
“I’m afraid that a house I buy today will not be worth what I paid down the road,” he said. “I am concerned [about whether] I should play the waiting game some more.”
DeFabiis represents a new breed of house-hunter: the fence-sitter. In a National Association of Realtors survey this spring, 20 percent of Realtors said they have potential buyers waiting it out.
“They’re a very big percentage of home buyers now, people waiting for the market to hit bottom,” said Dianna Ivanov of Terrie O’Connor Realtors in Ramsey. “We have a standard Realtor phrase: ‘You don’t know when the market has hit bottom until prices start rising.’ ”
Denise Cerone of Gentry Realty Associates in Maywood, who has been working with fence-sitter DeFabiis, added, “Everybody’s hoping they get the best buy and don’t overpay. It’s a little hard to tell them differently because prices have come down.”
The fence-sitters are not sitting idly by. They are more like air traffic controllers monitoring the downward progress of a whole slew of properties in which they’re interested, working the Internet and strategizing the most propitious time to make an offer.
Walter M., who asked that his full name not be used, has been house-hunting with his wife for a year. They can spend up to $750,000 (without having to sell their South Bergen condo) and have been searching in Upper Saddle River, Woodcliff Lake, Montvale, Mahwah, Franklin Lakes, Cresskill and Demarest, as well as Wayne and Ringwood.
Walter has a roster of NJMLS listings he tracks regularly. He forwarded a list with his commentary.
Of a $625,000 ranch in Upper Saddle River, he said: “Price just dropped for the third time in one month.”
Of a $799,000 five-bedroom home with a pool in Upper Saddle River, he said: “Listed well over $1 million originally.”
Of a $700,000 three-bedroom ranch in Woodcliff Lake, he said: ‘This would be a good deal at $600,000.”
And a five-bedroom, 3 1/2-bath contemporary colonial listed at $925,000 in Upper Saddle River prompted this comment: “Nice modern house. Originally listed over $1 million. According to the agent, the owners turned down an $850,000 offer not too long ago. By March, they will wish they accepted it.”
Francine O. (who doesn’t want her full name used) is another self-described fence-sitter. She and her husband owned a home in Montvale for 45 years, bought a home in Florida for their retirement, and sold that home in 2005 to move back to Bergen County to be near their family. They have $250,000 in cash from the sale of their Florida home to put into a small single-family home in Bergen County. They don’t want to carry a mortgage. They’ve been looking for a year.
“Prices are down, but they’re not down enough,” Francine said.
When these fence-sitters do make a bid, it is often an extreme low-ball. DeFabiis bid on a house in Maywood a little more than a month ago.
“It was an estate sale, and the ad said, ‘Bring all offers,’ ” said DeFabiis. “It needed a new kitchen, a new bath. It was certainly not a turnkey house. They were looking for $379,000 and I offered $305,000. They never responded to the offer, and I finally withdrew it.”
A year ago, said Walter M., if you indicated you were going to make a low-ball bid, the agent would tell you to go to a more affordable town.
Now, he said, “If you’re going to make an offer that’s $150,000 off price, the agent will say, ‘Put it on paper.’ ”
Real estate analyst Jeff Otteau of the Otteau Valuation Group in East Brunswick said prices in North Jersey have dropped 19 percent since the high of 2005 and will likely continue to drop for the next six months or so, by 5 percent to 10 percent more.