From the Record:
This spring — traditionally the busiest time in the housing market — buyers may find they’ve got fewer choices than they’d like, because the inventory of homes on the market is down, compared with last year. In Bergen County, the number of single-family homes for sale dropped 25 percent in January and February, and in Passaic County, about 15 percent.
One big reason is that many sellers have held off because of the unusually harsh winter weather, and they’re likely to list their properties soon, which may bring a surge of properties to the market.
But other homeowners — especially those who bought during the housing boom — still can’t sell without taking a loss, and those properties are likely to stay off the market, shrinking the potential pool of available homes.
“There are still sellers waiting for the market to improve in order for them to get out,” said Jeff Adler, a Keller Williams agent in Ridgewood.
“A lot of sellers have been taken aback by the amount of decline from the peak to where the market is now,” agreed Jorge Ledesma, a Re/Max agent in Teaneck. “It’s a bitter pill to swallow when you see so much equity in your home, and through no fault of your own, you see it go away.”
Home prices in the region are still, on average, about 20 percent below their 2006 peaks, so owners who bought during the housing boom may well be “underwater” — that is, owing more on the mortgage than their home is worth. Others may not be underwater but still have 2006 prices stuck in their heads as the “real” value of their home, and are reluctant to sell for less.
As home prices rise, more of these homeowners will be willing and able to sell, observers say. With prices up statewide an estimated 4.3 percent last year, many homeowners are already moving out of the underwater category, said Jeffrey Otteau, an East Brunswick appraiser who follows home prices statewide.
The bad weather was a factor in many sellers’ decision to delay listing their homes, real estate agents say. Ledesma said he knows of sellers who held off because they couldn’t do exterior painting and other “curb appeal” chores during the bitter cold. Other sellers didn’t like the idea of buyers tracking snow into the home.
“If you’re going to sell, you want to put your best foot forward,” Funabashi said.
“Normally our spring market starts in March, but it’s really late this year because of the weather,” said Ellen Horowytz, an agent with Prominent Properties Sotheby’s International Realty in Franklin Lakes. “People have been waiting; they’re saying, let’s wait till things start to bloom a little bit.” She expects a surge of listings soon.
The laws of supply and demand would suggest that tight inventory should push prices up, and agents report that attractive properties are drawing multiple bids and higher prices.
But buyers and appraisers seem to have limits on how high prices can go, they said.
“It still has to be priced right,” Horowytz said. “Buyers are very savvy out there. Everybody does their due diligence.”
Some homeowners who are not underwater, but are holding out for a higher price, may have to wait a while. Otteau estimates that average prices in New Jersey — outside of the most desirable towns — won’t return to their housing-boom peaks until 2022. And if prices go up, sellers will have to pay more for their next house.
“A lot of people come to us and say, ‘We’ve got to wait till we get X dollars for our house,’ but if you wait, the next house you get will go up by the same percentage,” Aiosa said.
“Whatever you gain by waiting on the house you’re selling, you’re going to give back on the house you’re buying,” Otteau agreed.