From the NY Times:
OVER the last six months or so, it seems several New Jersey towns have developed symptoms of split personality — at least when it comes to their real estate markets.
Take Montclair, for instance: the median sales price has been declining, as anyone can clearly see from looking at the downward pitch of the line graph updated weekly on many brokers’ Web pages by Altos Research. But decline means different things in different places. In the area often called Upper Montclair (ZIP code 07043), the descent to $615,000 from $700,000 was herky-jerky, up and down, between April 1 and the middle of September, according to Altos. But in the rest of town (ZIP code 07042), the median skied nonstop down a steep mountain: $700,000 all the way to $400,000.
Likewise, median prices harmonized in Millburn Township and its Short Hills section — another area with its own ZIP code — while clearly singing different parts. Millburn/Short Hills is one of the very few communities in the state where sales values are rising again, according to Karen Eastman Bigos, a broker with the Towne Realty Group.
The median for the township rose to $620,000 from $570,000 from April 1 to mid-September. Over the same period, the median for Short Hills rose to $1.6 million from $1.5 million. That means property in Short Hills escalated more in value — by about a percentage point — even though it is more than twice as expensive.
“How do we explain these things?” asked Ken Baris, the president of Jordan Baris Realty, a company that recently developed a “hyperlocal” computer system for analyzing price trends by school district or neighborhood. “Local, local, local — there is no other word but local in real estate.”
In Montclair, where there is a concerted emphasis on thinking of the town as one diverse whole — children are bused to “magnet” schools, and the moniker “Upper” is discouraged as divisive — several agents resisted comparisons of trends on the two sides of town.
“Sometimes people come in saying they only want to buy in the one ZIP code, 07043,” said Linda Grotenstein, an agent at Coldwell Banker. “I usually find they have a misunderstanding of what the ZIP codes imply.”
The housing stock is more homogeneous in the northern half: mostly well-groomed Victorians with three to six bedrooms. The south end has far greater range: everything from run-down, run-of-the-mill triplexes on narrow lots to peerless mansions on manicured grounds, in the “estate section.”
In fact, by Mr. Baris’s reckoning, the estate section in the southern part of Montclair has kept overall average sales value afloat. It had 42 listings this year, and 18 houses sold, at a median price of $1.218 million, 31 percent more than last year.
“If you took out the estate section,” Mr. Baris said, “Montclair would have depreciated as a town.”
In Millburn/Short Hills, Ms. Bigos ascribes the huge price disparity to the teardown craze that swept Short Hills starting in the late 1990s.
“That is when the spread started to widen,” said Ms. Bigos, a lifelong resident of Short Hills. “All the new houses going up doubled and tripled in value.”