A long way to “recovery”

From the Star Ledger:

N.J. home prices slowly recover from housing bubble

Slowly but steadily, New Jersey’s housing market is recovering.

The average home sale price in New Jersey in 2015 was $397,279, according to the state Division of Taxation. But most towns throughout New Jersey are still showing average sales below the pre-housing bubble peaks.

“We’re not out of the woods yet,” said Tg Glazer, president of the New Jersey Realtors Association. “There’s still work to be done, but everything is looking very positive and I believe that things will continue to move forward throughout the year.”

Figures from the New Jersey Realtors Association for 2015 show home sales rose 12.3 percent to 93,635 and there were small upticks in the median and average sales prices, according to figures from the New Jersey Realtors Association — a hopeful sign as the spring selling season gets underway.

The 22.7 percent jump in pending sales in December over the year before pointed to 2016 getting off to a strong start. But even as job gains, low mortgage rates and consumer confidence help boost home sales, the number of homes for sale has fallen.

In December, for example, there were 10.6 percent fewer listings — 49,829 compared to 55,720 at the same time in 2014.

“Our economy and housing sector are both better than where they were in the recession, but both have a ways to go before anybody would want to cheer at the pace of activity,” said Patrick O’Keefe, director of economic research at CohnReznick, an accounting and consulting firm.

Even though home prices are showing signs of increasing, there is still a large number of homeowners who are underwater on their mortgages and are reluctant to sell at a loss, he said.

“If they bought from 2005 to 2007, they paid prices that were still well above where the market is today,” O’Keefe said. “As a consequence, if they list their homes for sale, they’re going to get offers well below what they paid and unless it’s a distressed situation where they have to move, it would be irrational to sell the house at the discounts.”

New Jersey housing prices continue to lag behind the national average, he said, citing the housing price index calculated by the Federal Housing Finance Agency.

Nationally, prices in the last quarter of 2015 were 0.3 percent higher than in 2007, while New Jersey’s prices were 13.8 percent less. But compared with New Jersey’s own peak in the second quarter of 2006, prices are down 21.3 percent.

“Those price factors are a major reason why the state’s housing recovery has lagged the rest of the country,” O’Keefe said. “Our prices ran up more sharply prior to the housing meltdown and have recovered far more slowly in the aftermath of the meltdown.”

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33 Responses to A long way to “recovery”

  1. Mike says:

    Good Morning New Jersey

  2. GOP's broken (the good one) says:

    while there are countless moronic, insipid, boring comedians like Seinfield,
    only a few true geniuses like Shandling.

    RIP Garry. We will miss you

  3. Comrade Nom Deplume, Recovering From The Slopes says:

    [2] twitless

    This has to be the seventh sign of the apocalypse. I agree with the twitiot on something.

  4. Fast Eddie says:

    I’m on the train reading today’s post and I have to restrain myself from laughing out loud. What a useless f.ucking industry that is the real estate business. Purely mindless.

  5. Not Fasty Eddie says:

    #4 Eddie, best explanation.

    The first few minutes


  6. Now Spanky, be reasonable says:

    #5 Continue watching to discover the origins of modern fiscal policy, at 26:56 or so…

  7. Fabius Maximus says:

    #32 (Previous thread)

    Getting $20 out of someone is no indication they won’t walk on the $2K consult fee. In this case, it is a perfect example of the problems of retail moving to IPADs.

    Get to the office in IMUS, try to check in on the kiosk. Told information incomplete need to pay the copay, up two floors to a “helpdesk” or whatever they called it. Queued, told to go down a floor to finance to pay the copay. Downstairs, queue, pay. Back upstairs to the “helpdesk” to show proof of payment . Receptionist flags the payment in the system. Downstairs back to the kiosk 40mins after arriving to finally check-in. Two minutes later, a stroppy nurse calls our name and tells me we are 20mins late for our appointment.

  8. The Great Pumpkin says:

    “The traditional case never said that free trade makes everybody better off, let alone that it makes everybody better off immediately. The consensus view always acknowledged that there would be winners and losers. (Why would the demand for trade barriers arise if competition from imports didn’t hurt somebody?) The argument has only ever been that free trade raises real incomes in the aggregate — that the gains exceed the losses. The new work leaves this claim intact.

    The force of Autor’s findings actually has little to do with trade policy as such. Its value lies, or ought to lie, in the emphasis it puts on helping workers, towns and regions adjust to economic dislocation. Trade is only one cause of such dislocation, and usually not the most powerful, China notwithstanding. Bear in mind, manufacturing employment has been declining in the U.S. for decades, since long before the Chinese export machine started up. The most disruptive force in any economy is technology.

    The new research matters because it shows that the U.S. labor market is a lot less flexible than its reputation has suggested. Workers are more likely to get trapped, with or without work, in depressed towns and regions. They find it hard to switch to good alternative occupations. It’s true that this inflexibility adds to the costs of free trade — but it adds to the costs of all kinds of economic disruption. Labor-saving automation and other forms of innovation are more costly if workers can’t move; so is domestic competition. Those forces involve dislocation too; they also create winners and losers.

    Rather than try to block trade, technological progress and competition, it seems more promising to make labor markets more adaptable by helping workers move from job to job and place to place — and to give more support to those who can’t make the transition even with the extra help.

    It’s fair to say that free-trade evangelists have often too blithely assumed that helping the losers is not a first-order concern, and in some cases no concern at all. That has always been a mistake, which the new research may help to correct. But it would be strange to make providing such help a condition for supporting free trade — unless you also make it a condition for supporting competition and technological progress.

    Incidentally, it’s worth noting that the gains China reaped from trade have been vastly greater than the gains derived by the U.S. Hundreds of millions of Chinese have been lifted out of poverty, supporting one of the greatest surges in economic and social progress the world has ever seen. If distribution matters — a point that’s often emphasized by progressive free-trade skeptics — the enormous relief of poverty outside the U.S. should presumably count for something.

    The debate over TPP introduces new complications, and involves more than the traditional presumption in favor of free trade. This new pact involves new kinds of trade — not just goods but also services, investment and intellectual property — and therefore different economic trade-offs apply. One thorough study of its effects predicts global gains of roughly half a trillion dollars a year by 2030, with the U.S. claiming the biggest share. In the aggregate, it will raise U.S. wages but “impose adjustment costs on some workers.”

    Again, winners and losers. Here, though, the research mentioned earlier isn’t directly relevant. The mechanisms explored in that work are about trade in manufactures. From the U.S. point of view, the case for TPP is stronger, not weaker, than the case for ordinary trade liberalization. Last year, in an article for the Washington Post, none other than Autor and his co-authors explained why. TPP has “little downside” for the U.S., they said; it would allow American companies to “excel in the sectors where they are strong,” and “give a substantial boost to U.S. trade.”

    That would seem to call for strong expert support of TPP, rather than the apologies, shuffling of feet, and lukewarm opposition that has characterized so many responses. Surprisingly, the general public remains relatively well disposed toward trade: Voters may have a better grasp of the issue than many commentators and most politicians.

    That’s something. But the prevailing mood of expert disenchantment with free trade is still disappointing. It misconstrues important new research, directs attention to the wrong questions, and supports the adoption of bad policies. It does the country a grave disservice”

  9. The Great Pumpkin says:

    8- Good piece and opened my mind to looking at the issues of free trade in another light.

    “Does economics still believe in free trade? The discipline has urged the case for open markets since its earliest days, but lately not so much. Recent research is seen as calling the faith into question.

    When Mitt Romney recently attacked Donald Trump for threatening a trade war that would plunge the U.S. back into recession, Paul Krugman, a leading authority on the economics of trade, assaulted Romney for his misunderstanding:

    Now suppose we have a trade war. This will cut exports, which other things equal depresses the economy. But it will also cut imports, which other things equal is expansionary. For the world as a whole, the cuts in exports and imports will by definition be equal, so as far as world demand is concerned, trade wars are a wash.
    Set aside the idea that a trade war, “other things equal,” would have no effect on world demand — a questionable claim (even if it comes from a Nobel laureate who assures his readers, “I really, truly know what I’m talking about”). What’s striking is that Krugman thought it more useful to attack Romney for his flawed thinking on trade than Trump for his. On the Trans-Pacific Partnership, Krugman has described himself as a “lukewarm opponent,” and has said that the case for more trade agreements is “very, very weak,” adding:

    And if a progressive makes it to the White House, she should devote no political capital whatsoever to such things.
    So much for Adam Smith.

    The lack of expert enthusiasm for trade liberalization isn’t confined to Krugman. Contributing to it most recently is a new strand of the trade literature that looks carefully at the costs of adjusting to foreign competition. This work, notably papers by David Autor of MIT and collaborators, has attracted a lot of attention.

    The Economist, which has campaigned for free trade since it was founded in 1843, discussed the findings in an article ominously titled “Trade in the balance.” It said the results “provide convincing evidence that workers in the rich world suffered much more from the rise of China than economists thought was possible.”

    Well, Autor and his co-authors find that some workers have suffered more from Chinese competition than most economists would have thought likely. That’s still an important thing to know, and policy prescriptions follow from it. But those prescriptions aren’t new, and they sure don’t include raising trade barriers. This research doesn’t come close to refuting the traditional case for liberal trade — and its authors are careful never to suggest otherwise.”

  10. The Great Pumpkin says:

    8- Pretty good comments on that piece that I felt were worth sharing.

    “Free trade has a few problems. One is that the gains of free trade will only go to certain sectors and industries, while the losses go to others. For TPP, it looks like mftg will take another hit, while financial services may do well. So poorer workers in mftg take the loss, while the wealthier get the gains. Mftg companies will be fine because they can just outsource their brand overseas, mind you. This might all be fine, except we don’t believe in distributing income in the Federal govt. We certainly don’t believe in increasing govt-funded micro investment to help poorer people without credit access start businesses, nor investment in infrastructure, and we only half-heartedly believe in job retraining. All of these are key because the transition costs of free trade most likely last 30 years or longer, which is almost as long as the careers of many workers affected by free trade.”

    “Yup, the best economists can come up with is that “free trade” has helped people — just not most Americans. So why did we do it, again?”

  11. Captain Nom Deplume, Besotted Rummy says:
  12. chicagofinance says:

    Patten commented “Education is not indoctrination. Our history is not a blank page on which we can write our own version of what it should have been according to our contemporary views and prejudice”

    “Dear Scrotty Students,

    Cecil Rhodes’s generous bequest has contributed greatly to the comfort and well being of many generations of Oxford students – a good many of them, dare we say it, better, brighter and more deserving than you.

    This does not necessarily mean we approve of everything Rhodes did in his lifetime – but then we don’t have to. Cecil Rhodes died over a century ago. Autres temps, autres moeurs. If you don’t understand what this means – and it would not remotely surprise us if that were the case – then we really think you should ask yourself the question: “Why am I at Oxford?”

    Oxford, let us remind you, is the world’s second oldest extant university. Scholars have been studying here since at least the 11th century. We’ve played a major part in the invention of Western civilisation, from the 12th century intellectual renaissance through the Enlightenment and beyond. Our alumni include William of Ockham, Roger Bacon, William Tyndale, John Donne, Sir Walter Raleigh, Erasmus, Sir Christopher Wren, William Penn, Rep. Adam Smith (D-WA), Samuel Johnson, Robert Hooke, William Morris, Oscar Wilde, Emily Davison, Cardinal Newman, Julie C^cks. We’re a big deal. And most of the people privileged to come and study here are conscious of what a big deal we are. Oxford is their alma mater – their dear mother – and they respect and revere her accordingly.

    And what were your ancestors doing in that period? Living in mud huts, mainly. Sure we’ll concede you the short lived Southern African civilisation of Great Zimbabwe. But let’s be brutally honest here. The contribution of the Bantu tribes to modern civilisation has been as near as damn it to zilch.

    You’ll probably say that’s “racist”. But it’s what we here at Oxford prefer to call “true.” Perhaps the rules are different at other universities. In fact, we know things are different at other universities. We’ve watched with horror at what has been happening across the pond from the University of Missouri to the University of Virginia and even to revered institutions like Harvard and Yale: the “safe spaces”; the‪ #‎blacklivesmatter; the creeping cultural relativism; the stifling political correctness; what Allan Bloom rightly called “the closing of the American mind”. At Oxford however, we will always prefer facts and free, open debate to petty grievance-mongering, identity politics and empty sloganeering. The day we cease to do so is the day we lose the right to call ourselves the world’s greatest university.

    Of course, you are perfectly within your rights to squander your time at Oxford on silly, vexatious, single-issue political campaigns. (Though it does make us wonder how stringent the vetting procedure is these days for Rhodes scholarships and even more so, for Mandela Rhodes scholarships) We are well used to seeing undergraduates – or, in your case – postgraduates, making idiots of themselves. Just don’t expect us to indulge your idiocy, let alone genuflect before it. You may be black – “BME” as the grisly modern terminology has it – but we are colour blind. We have been educating gifted undergraduates from our former colonies, our Empire, our Commonwealth and beyond for many generations. We do not discriminate over sex, race, colour or creed. We do, however, discriminate according to intellect.

    That means, inter alia, that when our undergrads or postgrads come up with fatuous ideas, we don’t pat them on the back, give them a red rosette and say: “Ooh, you’re black and you come from South Africa. What a clever chap you are!” No. We prefer to see the quality of those ideas tested in the crucible of public debate. That’s another key part of the Oxford intellectual tradition you see: you can argue any damn thing you like but you need to be able to justify it with facts and logic – otherwise your idea is worthless.

    This ludicrous notion you have that a bronze statue of Cecil Rhodes should be removed from Oriel College, because it’s symbolic of “institutional racism” and “white slavery”. Well even if it is – which we dispute – so bloody what? Any undergraduate so feeble-minded that they can’t pass a bronze statue without having their “safe space” violated really does not deserve to be here. And besides, if we were to remove Rhodes’s statue on the premise that his life wasn’t blemish-free, where would we stop? As one of our alumni Dan Hannan has pointed out, Oriel’s other benefactors include two kings so awful – Edward II and Charles I – that their subjects had them killed. The college opposite – Christ Church – was built by a murderous, thieving bully who bumped off two of his wives. Thomas Jefferson kept slaves: does that invalidate the US Constitution? Winston Churchill had unenlightened views about Muslims and India: was he then the wrong man to lead Britain in the war?”

    Actually, we’ll go further than that. Your Rhodes Must Fall campaign is not merely fatuous but ugly, vandalistic and dangerous. We agree with Oxford historian RW Johnson that what you are trying to do here is no different from what ISIS and the Al-Qaeda have been doing to artefacts in places like Mali and Syria. You are murdering history.

    And who are you, anyway, to be lecturing Oxford University on how it should order its affairs? Your ‪#‎rhodesmustfall campaign, we understand, originates in South Africa and was initiated by a black activist who told one of his lecturers “whites have to be killed”. One of you – Sizwe Mpofu-Walsh – is the privileged son of a rich politician and a member of a party whose slogan is “Kill the Boer; Kill the Farmer”; another of you, Ntokozo Qwabe, who is only in Oxford as a beneficiary of a Rhodes scholarship, has boasted about the need for “socially conscious black students” to “dominate white universities, and do so ruthlessly and decisively!

    Great. That’s just what Oxford University needs. Some cultural enrichment from the land of Winnie Mandela, burning tyre necklaces, an AIDS epidemic almost entirely the result of government indifference and ignorance, one of the world’s highest per capita murder rates, institutionalised corruption, tribal politics, anti-white racism and a collapsing economy. Please name which of the above items you think will enhance the lives of the 22,000 students studying here at Oxford.

    And then please explain what it is that makes your attention grabbing campaign to remove a listed statue from an Oxford college more urgent, more deserving than the desire of probably at least 20,000 of those 22,000 students to enjoy their time here unencumbered by the irritation of spoilt, ungrateful little tossers on scholarships they clearly don’t merit using racial politics and cheap guilt-tripping to ruin the life and fabric of our beloved university.

    Understand us and understand this clearly: you have everything to learn from us; we have nothing to learn from you.

    Oriel College, Oxford

  13. Juice Box says:

    Some pretty wild prices out there.

    Case in point, a few blocks from me a corner lot on very busy 40 mph road, house has been for sale all winter. It was built in 200o, sold for 532K new construction, 4 Br Center Hall on an acre, was listed for $910K in Jan 2016 and then reduced to $899k in Feburary. Pictures of home interior show all original equipment and fixtures even probably the same paint from the year 2000. Tax assessment is 740k with 14k a year in taxes, assessment was reduced a few times down from $820K, so it looks like they appeal every year. I suspect listing will expire and the next realtor with a fish eye lens will attempt to stage it, and another season will go by with no offers.

  14. Fast Eddie says:


    What general area, if you can reveal.

  15. Juice Box says:

    Re: 14 Gary – Haughty Court, every town has one.

  16. walking bye says:

    Juice box. So from the article above, prices peaked in 2006 and are down 21%. Figure the house probably peaked at $900k-1m from 523k in 2006? Which would put it at 800k? without knowing much more hard to tell what you feel should be a fair price.

  17. Fast Eddie says:

    “If they bought from 2005 to 2007, they paid prices that were still well above where the market is today,” O’Keefe said. “As a consequence, if they list their homes for sale, they’re going to get offers well below what they paid and unless it’s a distressed situation where they have to move, it would be irrational to sell the house at the discounts.”

    In further news, day is followed by night!

  18. Juice Box says:

    re # 16 – Point is home owner did their own comps for the tax appeal and still overpriced it.

    In 2010 was assessed at $810,000 they appealed assessment using comps and got it down -12.8% to $722,000. In 2014 they appealed assessment again and got it down another to -6.7%to $650,000.

    Now they are asking currently $899,00 was $910,000 and it has been sitting for nearly 4 months.

    Tax collector thinks it is now worth 720k. Homeowner is probably angry about the tax assessment going up again and are now selling especially since they listed in January after the the tax card arrived, yet they over priced it.

  19. Juice Box says:

    re: # 18 – The again two recent sales Jan 2016 and July 2013 on same street Haughty Court sold recently, bigger and 5 Br homes sold for 1.1m and 1.03m at the end of the court. Both are bigger updated homes in same development built in year 2000, homes were much bigger and better to begin with and had had some really nice updates. I would share pics but I don’t want Clot to find me :)

  20. walking bye says:

    Juice, I thought you were making a point about asking price vs market price aka reality. I was chastised a bit some weeks ago about home prices. one commentator stated that homes were selling briskly and the time to buy was 2011 as prices have appreciated. Homes were selling above peak prices. I don’t see it in Bergen county. I still see avg 20% below peak asking/selling. There is stuff that sits on the MLS for months which is priced above peak.

  21. Juice Box says:

    re: #20 – Walking comps are reality, you are not getting your tax assessment reduced to 650k without the comps, there are plenty of 4 BR homes listed by me none are near 900k mark. This home owner is still about 20% too high, on a busy road with no updates.

  22. Juice Box says:

    Another real estate anecdotal story for today.

    A coworker of mine is busy doing two flips. He is from cow tipping country up near Albany, and he bought two flips up there for around $50k each and is putting in about $35k updates in each one, first one now has an offer and he says he will net about $20k on the first and the second to be listed soon with about same profit. Should be interesting to see how he fares in the next month or so.

  23. walking bye says:

    Juice- could be possible. $105k for nice home with a new home depot kitchen, some pergo floors, and new baths. In Albany you would need an income of $50k. to buy this on a 30 year. Wish him well. Have a friend looking to retire (mid 40’s) after doing this and rentals.

  24. GOP's broken (the good one) says:

    don’t know what’s your point but makes me wonder if oxford has as many frauds as Chicago’s finance biz skool

    chicagofinance says:
    March 28, 2016 at 12:17 pm

    Patten commented…..

  25. Statler Waldorf says:

    Today “free trade” means China and other countries can import slave-labor goods into the United States with out any barriers, while goods made in the US with non-slave-labor, environmental considerations, worker safety, etc, face tariffs and obstacles when imported into China.

    Only the ivory tower set, and those removed from the reality, think sensible tariffs are a bad thing. The decimation of Detroit and cities across the country speak for themselves.


  26. joyce says:

    Protectionism is the devil!

  27. Libturd at home for one more night before CHOP says:

    I thought the white man was the devil?

  28. Statler Waldorf says:

    “Protectionism is the devil!”

    It’s working well for China.

  29. 10 “happiest” places in NJ. Isn’t that like the 10 best cells at Riker’s?

  30. The Great Pumkin says:

    That’s the bottom line.

    Statler Waldorf says:
    March 28, 2016 at 10:42 pm
    “Protectionism is the devil!”

    It’s working well for China.

  31. The Great Pumkin says:

    Theory is great, but if your comp is playing by another set of rules, throw the theory out the window.

  32. Bonjour,
    un petit mot pour vous dire que j’adore votre blog, alors je ne me prive pas !

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