From the NY Times:
THE housing market in New Jersey has been on a little roll toward recovery — the number of sales has risen and the number of houses on the market has fallen for four straight months — even though activity cooled slightly in August for the country at large.
But what does that mean for home prices? A halt in the decline? Even, possibly, a start in the other direction?
“In some neighborhoods, I have to say yes, prices are starting to go up,” said Karen Eastman Bigos, a partner in the Towne Realty Group, based in Short Hills, one of the highest-priced markets in northern New Jersey.
On the other hand, she and others say, brokers continue to encounter sellers who are “stuck in 2006.” Some people hear news reports about the improvement in conditions nationally, and insist on pricing their homes at precrash levels, Ms. Bigos said.
Most recently, Jeffrey Otteau, the group’s president, announced his view that it will take until 2016 for prices to recover to their high point in 2006.
Over all, he added, it is “very difficult — and possibly too soon” to say whether prices have even stopped their decline.
For one thing, data on final sales prices are not available until sales close — usually two to six months after a contract is signed — so there is a lag time before conclusions can be drawn. For another, there is no tried-and-true analytical method for determining the direction prices are headed at a time of flux like this.
When pressed to consider what could be discerned from information now at hand, Mr. Otteau came up with this: The seasonal shift downward in prices that occurred from summer to fall was not as sharp as last year’s. This year, the downward shift from the second to third quarters was 7.4 percent; last year, it was 10.4 percent.
Mr. Otteau said his data suggested that “a ground is beginning to form in terms of prices,” and noted that the trend had occurred as government stimulus programs that were intended to stabilize the residential real estate market were taking effect.
No matter how good the numbers are in a particular community, however, realistic pricing is critical.