NJ adds 59,100 jobs in 2012, still a long way to go

Posted on March 19, 2013 by grim

From the APP:

NJ’s 2012 job growth was strongest in a dozen years, despite Sandy

New Jersey’s job market withstood the shock of superstorm Sandy in 2012 to post its strongest annual growth since the waning days of high-tech bubble more than a decade ago, the state reported Monday.

The gain required no small portion of resourcefulness from workers, particularly at the Shore, where they battled floods and power outages last fall simply to stay in business.
“Really, we formed, like, a little family,” said Andrea Canton, a hair stylist who moved into S&G Hair Studio in Point Pleasant Beach after her own salon in the borough was severely damaged. “Everybody was leaning on everybody, trying to get back to normal.”

The report by the U.S. Bureau of Labor Statistics is part of annual revision process that it calls benchmarking, providing a more accurate look at the labor market than the preliminary results it releases each month.
…
New Jersey had been lagging the nation since the recession ended. But the state last year added 66,400 jobs – 59,100 in the private sector and 7,300 in the public sector – keeping up with the pace of job growth nationwide. It was the strongest year since the state added 76,800 jobs in 2000.

The unemployment rate at the end of 2012 was 9.5 percent, still higher than U.S. jobless rate of 7.8 percent.

January’s figures, also released on Monday, showed the state returned to modest growth. It added 2,600 jobs, and its unemployment rate remained at 9.5 percent.
“It turns out that 2012 was a much better year than we had originally thought,” said James W. Hughes, an economist and dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University.
…
Either way, economists said New Jersey has a long way to go before it fills the hole left by the collapse of the housing bubble. The state has recovered fewer than half of the 241,000 private-sector jobs it lost during the recession, Hughes said.

Posted in Economics, Housing Recovery, New Jersey Real Estate | 179 Comments

Home equity up, mortgage debt down

Posted on March 18, 2013 by grim

From the LA Times:

Many underwater homeowners are coming up for air

Home equity is back, and it’s growing fast.

According to the latest data from the Federal Reserve, Americans’ net equity in their houses jumped nearly $500 billion during the last three months of 2012 and $1.7 trillion since spring 2011.

What does this mean to you personally? Depending on where your home is, it could mean that finally — after years of struggling with an underwater mortgage, one that exceeds the value of the home — you are seeing the market value of your property rise into positive equity territory, or at least closer to the break-even mark. Zillow Real Estate Research estimates that nearly 2 million U.S. homeowners exited negative equity status during 2012 alone.
…
Here’s what the Fed found in its “flow of funds” study released March 7:

• Thanks to recovering housing values, total home equity is now at its highest level — about $8.2 trillion — since the bust and is gaining rapidly. In 2012, it rose a stunning $1.2 trillion.

• Outstanding mortgage debt continued to fall as owners paid down their balances and refinanced into smaller loans, taking advantage of unprecedented low mortgage rates. Foreclosures and principal forgiveness by lenders also have helped whittle away mortgage debt. Americans now owe about $1 trillion less on their homes than they did in 2008.

Jed Kolko, chief economist for Trulia, an online real estate research and information company, said growing home equity has three key effects. First, owners feel wealthier and are more likely to spend some of that perceived wealth — even if it’s illiquid in the form of real estate equity — on goods and services.

Second, higher equity reduces the likelihood of mortgage defaults. People have a deeper financial stake in their properties and are less willing to risk loss through foreclosure.

Fewer delinquencies, in turn, “mean less stress on the financial system,” thereby reducing the probability of another banking crisis a la 2008-09, Kolko said in an interview.

Finally, by encouraging owners to consider selling — either now or later in the cycle when prices could be even higher — growing equity holdings allow the real estate market to work better, with more transactions, more mobility for families, more new construction, more jobs and so on.
…
Doug Duncan, chief economist for mortgage investor Fannie Mae, said the recent jump in equity “puts us back on track toward where we were prior to the crisis” and represents a “transition to normal” conditions in the housing market. Though there are markets where last year’s double-digit price gains look bubbly and unsustainable to Duncan — notably in some of the inland cities of California — the increases in values elsewhere tend to be more modest and solid, simply making up for the declines experienced in the latter half of the last decade.

Posted in Economics, Housing Recovery, National Real Estate | 101 Comments

How I Learned to Stop Worrying and Love the Wreck

Posted on March 16, 2013 by grim

From the NYT:

Home Buyers Seek Manhattan Wrecks

For people scrambling to make their way in the real estate market, there are many routes, and one of the most adventurous involves buying what brokers often describe as wrecks (fixer-upper is the more diplomatic term). An anemic inventory combined with increasing reluctance to shell out huge sums of money for other people’s taste is sending a growing number of buyers to places they can redo to their own liking, right down to the shape of the kitchen island and the color of the bathroom tile.

These buyers willingly shoulder the often formidable financial and emotional costs of stripping a place to the studs and rebuilding it so as to end up with exactly the sort of home they want and may save money along the way.

Real estate brokers and analysts report a significant uptick in Manhattan in the number of buyers seeking properties in need of major overhaul, alert for such tipoff phrases as “bring your contractor and your imagination.”

According to Jonathan J. Miller, the president of Miller Samuel, the real estate appraisal firm, an analysis of sales of properties rated as “wrecks” or in “fair” or “poor” condition jumped 40 percent between the fourth quarter of 2011 and the same period in 2012. Between those two Decembers, the increase was a hefty 83 percent, indicating soaring desire for such properties at year’s end.

As for the limited inventory driving this trend, “the listing of properties in Manhattan fell 34 percent from the fourth quarter of 2011 to the same period last year, the lowest level we’ve tracked in more than 12 years,” Mr. Miller said. “So we’re seeing more creative and flexible buyers who are faced with a lack of choices as inventory remains tight. As a result, we’ve seen an increase in sales of places in poor condition — a k a wrecks.”
…
“There are always buyers who want places they can put their mark on and don’t want to pay for someone else’s renovation,” said Doug Perlson, RealDirect’s chief executive officer. “And in the last few months, with inventory so light, especially for middle-of-the-road buyers, we’re seeing more appetite for these properties. Buyers are seeing an upside to purchasing a home where they can both get a better deal and start from scratch.”

Posted in National Real Estate | 73 Comments

Can the early Spring trend be sustained? Or will low inventory kill it?

Posted on March 15, 2013 by grim

From Realtor.com:

Spring Home Buying Season Starts Early According to realtor.com®’s February Trend Data

Realtor.com’s February 2013 national housing data indicates that listing inventories increased 1.15 percent month-over-month; median age of inventory was at 98 days, a 9.26 percent decrease month-over-month; and median list prices were slightly higher month-over-month at $189,900. These numbers show that home buyers are getting an early start on the spring season despite the fact that inventories recently hit record lows.

“As we enter the busiest time of the year for home buyers and sellers, our latest housing trend data shows just how competitive the market is with a significant national housing recovery well underway,” said Steve Berkowitz, chief executive officer of Move, Inc. “Looking ahead, we can expect the amount of inventory to increase this spring along with higher list prices as sellers become more comfortable with the market conditions.”
…
The median age of inventory was down by 9.26 percent month over month and total listings are up 1.15 percent month over month, suggesting that many reluctant home sellers are starting to take an early advantage of the recent improvements in housing prices. Annual inventory decreases of -15.97 percent are consistent with a gradual, yet persistent downward trend that has been occurring over the last two years. From January 2013 to February 2013, the median age of inventory decreased in 145 of the 146 markets tracked by realtor.com. The national median list price also reversed its downward trend, rising by 1.55 percent over the month of February and 1.01 percent on an annual basis. In addition, the number of markets experiencing a decline in home prices is shrinking, implying more good news for the housing market and U.S. economy at large.

There continue to be pronounced regional differences in the strength of the housing market. Several areas in California are experiencing the highest increases in list prices coupled with the largest inventory declines. Phoenix, Seattle and Denver are also among the top performers across the U.S. However, many smaller industrialized markets in the Midwest and the Northeast registered year-over-year price declines, as did Philadelphia, Chicago and New York City. While the number of markets experiencing year-over-year list price declines had been increasing, this pattern appears to be turning around as home list prices increased in 78 markets last month on a year-over-year basis and declined in 39.

Posted in Economics, Housing Recovery, National Real Estate | 91 Comments

Foreclosures improve nationally, local markets not so rosy

Posted on March 14, 2013 by grim

From MarketWatch:

The number of U.S. properties with foreclosure filings fell 25% in February from a year earlier as U.S. bank reposessions dropped to a 65-month low, according to market researcher RealtyTrac.

There were 154,281 U.S. properties with default notices, scheduled auctions and bank repossessions in February, a 2% increase from January, RealtyTrac reported. One in every 849 U.S. housing units had a foreclosure filing last month.

“At a high level the U.S. foreclosure inferno has been effectively contained and should be reduced to a slow burn in the next two years,” said Vice President Daren Blomquist. “But dangerous foreclosure flare-ups are still popping up in states where foreclosures have been delayed by a lengthy court process or by new legislation making it more difficult to foreclose outside of the court system.”

Mr. Blomquist noted foreclosure starts have been steadily rising in those states over the last several months and likely will end up as bank repossessions or short sales later this year.
…
Properties starting the foreclosure process also fell 25% in February from a year earlier. U.S. bank reposessions were down 29% on a year-over-year basis to its lowest level since September 2007.

Florida posted the highest foreclosure rate among all states for the sixth month in a row. One in every 282 Florida housing units had a foreclosure filing last month–more than three times the national average. Nevada and Illinois again had the second- and third-highest foreclosure rates, respectively.

Posted in Economics, Foreclosures, National Real Estate | 57 Comments

I think she just called you lazy … and boring.

Posted on March 13, 2013 by grim

From HousingWire:

Millennials prefer a ‘fixer-upper’ to a cookie cutter home

The Millennials, recently deemed the next generation of homebuyers, have earned a new nickname for themselves: the Fix-It Generation.

According to a national survey released by Better Homes and Gardens Real Estate, 72% of Millennials (those born between 1982 and 2002) consider themselves just as handy — if not more so — than their parents.

Of those surveyed, 77% would prefer purposeful homes equipped with the technological capabilities many of us have grown accustomed to versus the “cookie cutter” luxury homes our parents’ generation wanted.

As soon as I read this, it made sense. I’ve written before about my personal home search experience. You see, I am a part of the Fix-It Generation, as we’re apparently being called now. My husband and I are targeting homes in an established North Texas suburb.

My preferred suburb is notorious for housing the wealthy and is considered a very safe and settled city. About 15 minutes up the road is a much newer city, where you can get more home for your money. You’re also farther from major highways as well as inconveniently farther from our favorite sushi place.

So my husband and I made a decision to look for an older home in the established – closer to work – suburb, which we considered a much better location, rather than finding a newer home a few miles up the road.

Posted in Demographics, Economics, National Real Estate | 166 Comments

Thank the Rich

Posted on March 12, 2013 by grim

From NJ Spotlight:

Christie’s Luck: Income Tax Surge Bails Out Budget

Three months ago, Gov. Chris Christie’s budget was in deep trouble. His revenue forecasts for FY2012 and FY2013 had come up a total of $750 million short. Standard & Poor’s had downgraded New Jersey’s revenue picture from “stable” to “negative,” and nobody knew what the real budget impact of Hurricane Sandy would be.

Today, however, thanks to a surge in income tax payments by wealthy taxpayers cashing out before federal tax hikes and cashing in on a bull market, it’s clear that Christie has dodged what could have been a major fiscal nightmare heading into his November reelection.

Yes, the Republican governor had to downgrade his revenue forecast for the year by $406.3 million and push off paying $396 million in property tax rebates until August, giving Democrats ammunition for the fall campaign. And yes, he did have to give up the income tax cut that was the centerpiece of last year’s budget speech.

But it could have been a lot worse.

Christie’s bold projection of an 8.3 percent revenue surge in FY2013 was built on assumptions of a broad-based “New Jersey Comeback,” an economic boom that would transform a state that had the fourth-highest unemployment rate in the nation and had ranked 47th in economic growth for two years in a row.
Christie’s bullishness led him to certify a budget built on more than 25 percent growth in corporate taxes and realty transfer fees, an 18 percent jump in casino revenues, 15 percent more from the lottery, 13 percent higher inheritance taxes, a 6.1 percent jump in sales taxes, and 5.7 percent in income taxes.

Eight months into the fiscal year, corporate taxes, inheritance taxes and casino winnings are all running lower than last year, and even motor vehicle and gas taxes are down, reflecting a weak economy. But despite an unemployment rate that still ranks among the highest in the nation, New Jersey’s income tax collections are soaring.
…
It is just the latest example of the disconnect between New Jersey income tax collections and the overall economy in a state whose highly progressive income tax structure and heavy reliance on healthy Wall Street financial markets creates its own boom-and-bust state budget cycle.
…
Wealthy taxpayers in New Jersey and other states pushed hundreds of millions of dollars of income into 2012 to avoid paying higher taxes in 2013 and future years. On January 1, the top tax bracket on individuals earning over $400,000 and families above $450,000 rose from 35 percent to 39.6 percent, and capital gains taxes jumped from 15 percent to 20 percent.
…
New Jersey’s approximately 16,000 millionaires paid $2.289 billion — or 26.4 percent — of the $8.686 billion in income taxes collected in 2010, the last year for which the Department of Treasury provided its detailed Statistics of Income report.

Overall, the top 20 percent of taxpayers, who make over $100,000, paid $7.263 billion, or more than 85 percent of total income taxes that year.
…
Most states, including New York, have significant income tax rates kick in at $25,000 or less, but not New Jersey, whose effective income tax rate on those earning under $75,000 is the lowest of any of the 43 states that have a state income tax.

It didn’t start out that way. New Jersey’s original 1977 income tax, pushed through by Democratic Gov. Brendan T. Byrne under a school-funding order from the state Supreme Court, was a virtual “flat tax,” with a 2 percent rate on income under $20,000 and 2.5 percent above that – not much different from the 3.07 percent flat rate that Pennsylvania currently imposes on both families and individuals.

Each of the five elected governors that succeeded Byrne made changes in the state income tax structure that made the system more progressive and thus increased reliance on wealthy taxpayers.

Posted in Economics, New Jersey Real Estate, Politics, Property Taxes | 131 Comments

Deep pockets needed to cash in on Sandy deals

Posted on March 11, 2013 by grim

From the AP:

Homebuyers Searching for Real Estate Deals in Hurricane Sandy Wreckage

It sounds like the premise for a new reality TV series: “Hurricane House” — people scouring waterside communities looking to buy homes damaged by Hurricane Sandy at a deep discount. While there are bargains out there, ranging from 10 percent off pre-storm prices for upscale homes on New York’s Long Island and the Jersey Shore to as much as 60 percent off modest bungalows on Staten Island and Queens, it’s still very much a game of buyer beware.

Not only are buyers on the hook for repairs and in some cases total rebuilds, they’re also wading into a host of potentially expensive uncertainties about new flood maps and future insurance rates, zoning changes and updated building codes. “It’s totally changed the way I sell real estate,” said Lawrence Greenberg, a sales associate with Van Skiver Realtors, whose own Mantoloking, N.J., office was wrecked in the storm.
…
There is no sign of a mass exodus from shoreline communities. The number of for-sale listings in January in the 380 Zip codes hit by the storm was about 2 percent below the same time last year, according to online real estate information company Zillow. That indicates that most homeowners are rebuilding, or have not yet decided how to proceed. But real estate agents in New York and New Jersey say the majority of homes for sale in these areas have some damage from the Oct. 29 storm, and it appears to them that a rising number are being put on the market as the spring home-buying season approaches.

New listings range from destroyed oceanfront properties being sold for the land, to flooded bayside homes untouched since the storm that must be gutted. Even the few undamaged homes in affected neighborhoods are listing at prices about 10 percent lower than they would have been pre-storm. Some sellers are overwhelmed by the daunting prospect of restoring a damaged home. Some are older homeowners who had stayed in the houses where they raised their families, but now are relocating. Some didn’t have flood insurance.

“They either don’t have the funds or don’t have the energy to go through the renovating and rebuilding process,” said Jeff Childers, a broker with Childers Sotheby’s International Realty in Normandy Beach, N.J.

Posted in Housing Recovery, Shore Real Estate | 74 Comments

How to get paid to live in a $1m house

Posted on March 10, 2013 by grim

From MarketWatch:

How luxury-home owners dodge foreclosure

When the owners of high-end homes fall way behind on their mortgage payments, foreclosure is not a foregone conclusion.

Lenders can be more willing to craft a new payment plan to make high-dollar homes more affordable. Paperwork and procedures are also often delayed, keeping homeowners in some states in their homes for two or more years after they’ve stopped making mortgage payments. And in some cases, lenders are offering homeowners tens of thousands of dollars in cash in exchange for their agreeing to a short sale, in which a home is sold for less than the borrower owes on the mortgage.

Repossession rates show the difference. Last year, roughly 85% of homes worth up to $1 million that received default notices were eventually repossessed, according to RealtyTrac, which tracks real-estate data. For homes worth more than $1 million, about 28%, or around 1,400 homes, were repossessed.

For lenders, it’s worth the extra effort to avert foreclosure on luxury properties. They incur substantial expenses holding these homes, including paying property taxes, maintenance costs and, often, homeowners’ fees. The homes are also more difficult to sell, since fewer buyers can afford to purchase them. And when lenders eventually unload them, it’s often at a loss. “Lenders have more of an incentive to work out payment plans for these borrowers than with the ones [whose homes] may move quickly,” says Jon Maddux, co-founder of YouWalkAway.com, which helps borrowers, including luxury homeowners, in default or foreclosure.
…

Separately, some lenders will encourage owners to consider a short sale. Armando Tiongson Jr. of Rockaway, N.J., says Bank of America recently offered him and his wife up to $30,000 in cash to sell their 4,100-square-foot home, which they purchased for roughly $1 million in 2006, in a short sale. Tiongson, an IT program manager, says he and his wife haven’t paid their mortgage in 18 months after the monthly payments on their loan, which initially required just interest payments, spiked. By offering this cash in exchange for a short sale, Bank of America says it can reduce the losses that would kick in if the loan goes to foreclosure. (The bank adds that it has been making such cash offers to homeowners of all loan levels since last year.)

The Tiongsons are going to take the bank up on its offer and sell. “We are going in for the short sale mainly to avoid foreclosure,” Tiongson says. “The cash option is really just a benefit.”

Posted in Foreclosures, New Jersey Real Estate | 33 Comments

Bailouts finally working?

Posted on March 9, 2013 by grim

From HousingWire:

Programs save 1.5 million homeowners: Obama Housing Scorecard

The Obama Administration’s foreclosure mitigation programs continue to provide relief for millions of homeowners in the housing recovery.

As a result, the Making Home Affordable Program has assisted more than 1.5 million distressed borrowers since its inception in 2009, the Obama Administration said in its February Housing Scorecard report.

HOPE Now lenders alone offered families and individuals more than 3.4 million proprietary mortgage modifications from the program’s beginnings through December 2012.

The Home Affordable Refinance Program also grew, continuing to offer homeowners affordable and sustainable relief to avoid foreclosure.

As of January, more than 1.1 million homeowners received a permanent modification through Home Affordable Modification Program, saving $546 on their monthly mortgage payments, and an estimated $17.9 billion altogether, the report noted.

Homeowners currently in permanent HAMP modifications were granted about $9.2 billion in total principal reduction. Of all non-agency loans eligible for principal reduction entering HAMP in January, 69% received a principal writedown.

The Federal Housing Administration has offered more than 1.6 million in loss mitigation and early delinquency interventions since the launch of HAMP.

In January, more than 105,000 second-lien modifications were completed through the Second Lien Modification Program. Additionally, more than 114,000 homeowners exited their homes through a short sale or deed-in-lieu of foreclosure with the assistance of the government’s Home Affordable Foreclosure Alternatives Program.

Posted in Economics, Housing Recovery, National Real Estate, Politics | 20 Comments

March Beige Book

Posted on March 6, 2013 by grim

From the Federal Reserve:

Beige Book – March 6, 2013 – Second District–New York

Economic activity in the Second District has continued to expand at a moderate pace since the last report. Business contacts report some pickup in input price pressures but relatively few say they are increasing their selling prices. The labor market has shown scattered signs of improvement: manufacturers report an upturn in hiring, and a major employment agency notes increasingly strong demand for temps. Retailers report that sales have generally been strong and ahead of plan in January and early February. Auto sales in upstate New York were also described as robust since the beginning of the year. Tourism activity has been mixed but generally strong thus far in 2013, with hotels getting an additional boost from displaced residents and recovery workers in the aftermath of Superstorm Sandy. Both residential and commercial real estate markets showed signs of improving since the last report. Finally, bankers report increased loan demand, no change in credit standards, further narrowing in loan spreads, and lower delinquency rates on commercial loans and mortgages.
…
Construction and Real Estate

Residential real estate markets in the District have shown signs of improvement in recent weeks. A major appraisal firm reports that New York City’s co-op and condo market has remained surprisingly active in early 2013, following an exceptionally strong fourth quarter. Apartment sales are up strongly from a year ago, and tight inventories are starting to nudge up prices across the board. One contact notes that year-end inventory levels were the lowest he has seen in more than 12 years. The apartment rental market, however, has leveled off; after rising at a roughly 5-10 percent rate in 2012, rents on apartments in both Manhattan and the outer boroughs are estimated to be running just 1-2 percent ahead of a year ago in early 2013.

An expert on northern New Jersey’s housing market reports a pickup in activity and an improvement in the general tone of the market, describing the current season as the best since 2007. Residential builders are reported to be increasingly optimistic–they anticipate a substantially better year than 2012 and are investing more heavily in new projects. Single-family construction is seen as picking up, as multi-family construction retains momentum. While there remains a large overhang of foreclosed and distressed properties, many of these are expected to be snapped up by investors. Realtors in the Buffalo area report continued favorable conditions in the housing market: prices have risen steadily at a moderate pace, inventory levels are fairly low, and sales activity has been steady.

Posted in Economics, Housing Recovery, New Jersey Real Estate | 169 Comments

CoreLogic: New Jersey Home Prices Positive (Case Shiller to follow)

Posted on March 6, 2013 by grim

From CoreLogic:

CoreLogic Home Price Index Rises by Almost 10 Percent Year Over Year in January

CoreLogic® (NYSE: CLGX), a leading residential property information, analytics and services provider, today released its January CoreLogic HPI® report. Home prices nationwide, including distressed sales, increased on a year-over-year basis by 9.7 percent in January 2013 compared to January 2012. This change represents the biggest increase since April 2006 and the 11th consecutive monthly increase in home prices nationally. On a month-over-month basis, including distressed sales, home prices increased by 0.7 percent in January 2013 compared to December 2012*. The HPI analysis shows that all but two states, Delaware and Illinois, are experiencing year-over-year price gains.

Excluding distressed sales, home prices increased on a year-over-year basis by 9.0 percent in January 2013 compared to January 2012. On a month-over-month basis, excluding distressed sales, home prices increased 1.8 percent in January 2013 compared to December 2012. Distressed sales include short sales and real estate owned (REO) transactions.

The CoreLogic Pending HPI indicates that February 2013 home prices, including distressed sales, are expected to rise by 9.7 percent on a year-over-year basis from February 2012 and fall by 0.3 percent on a month-over-month basis from January 2013, reflecting a seasonal winter slowdown. Excluding distressed sales, February 2013 home prices are poised to rise 11.3 percent year over year from February 2012 and by 1.8 percent month over month from January 2013. The CoreLogic Pending HPI is a proprietary and exclusive metric that provides the most current indication of trends in home prices. It is based on Multiple Listing Service (MLS) data that measure price changes for the most recent month.

“The HPI showed strong growth during the typically slow winter season,” said Mark Fleming, chief economist for CoreLogic. “With these gains, the housing market is poised to enter the spring selling season on sound footing. The improvements are materializing across the country, with all but Delaware and Illinois showing increasing HPI and 15 states within 10 percent of their peak values.”


Posted in Economics, Housing Recovery, New Jersey Real Estate | 96 Comments

Fiserv – Bold Forecast?

Posted on March 5, 2013 by grim

Hat tip to the reader who provided me with the Fiserv Home Price forecast data:

Metro Area / 2013-2014 Forecast / 2012 – 2017 Annualized Forecast
Atlantic City-Hammonton, NJ Metropolitan Statistical Area / 0.4% / 1.9%
Camden, NJ Metropolitan Division / 6.4% / 4.5%
Edison-New Brunswick, NJ Metropolitan Division / 2.1% / 2.6%
Newark-Union, NJ-PA Metropolitan Division / 5.9% / 4.1%
Ocean City, NJ Metropolitan Statistical Area / -0.3% / 2.1%
Trenton-Ewing, NJ Metropolitan Statistical Area / 7.5% / 6.5%
Vineland-Millville-Bridgeton, NJ Metropolitan Statistical Area / 6.6% / 5.3%

From UPI:

Home prices expected to rise at least 3.3 percent annually through 2017

Both home prices and home sales volumes increased steadily last year, making 2012 the first positive year for both prices and sales since the housing market crash, excluding gains induced by the home buyer tax credits in 2009 and 2010.

“Although some recent real estate activity has been speculative, it seems as if buyers have more realistic expectations about housing market returns after having lived through the largest housing market crash in U.S. history”

“2012 was the first year since 1997 that the housing market has resembled something recognizable as normal. For the past 15 years, home price changes and sales volumes have either been boosted by a bubble mentality or crushed by crash psychology,” said David Stiff, chief economist, Fiserv. “Back in 1997, housing prices grew 3 percent, just below the 5 percent long-term average rate of appreciation. From 1998 to 2006, prices appreciated at levels above 5 percent, with double-digit price increases in many of those years. Then, after 2006, the market collapsed as euphoria turned to panic. It took until the end of 2011 before housing markets finally started to stabilize. The latest Case-Shiller results show a return to a historically normal pace of price appreciation in the last year.”

The recovery in home prices has been solid and broad-based. At the end of the 2012 third quarter, prices were rising in approximately 62 percent of all U.S. metro areas, compared to 12.5 percent in the same period a year ago. Average U.S. home prices increased 3.6 percent from the third quarter of 2011 to the comparable period of 2012. Many of the metro areas that suffered the most severe declines during the housing market crash enjoyed the highest price increases in that period.

Fiserv Case-Shiller projects that by the end of 2013, home prices will be rising in nearly every metro area in the U.S. Some markets may experience short-term double-digit price jumps that could be partially reversed by price declines as large tranches of bank-owned inventory (REO) are liquidated. In other markets, price appreciation will slowly return to normal rates as home buyers regain confidence that the market has found its footing.
…
The Fiserv Case-Shiller Indexes, which include data covering thousands of zip codes, counties, metro areas and state markets, are owned and generated by Fiserv. The historical and forecast home price trend information in this report is calculated with the Fiserv proprietary Case-Shiller indexes, supplemented with data from the FHFA. The historical home price trends highlighted in this release are for the 12-month period that ended September 30, 2012. One-year forecasts are for the 12 months ending on September 30, 2013. The Fiserv Case-Shiller home price forecasts are produced by Fiserv and Moody’s Analytics.

Posted in Economics, Housing Recovery, New Jersey Real Estate | 87 Comments

People still want to live here?

Posted on March 4, 2013 by grim

From the Star Ledger:

Brooklynites planting roots in the Garden State

It’s almost like a dating service for people looking for a home. It starts with answering an involved questionnaire that poses the usual questions, such as how many bedrooms and bathrooms are you looking for.
But then it gets a bit more personal: Where did you grow up? What did you love-hate about it? What’s your work schedule like? How do you spend your summers? What type of commute do you prefer — train, boat, bus, car?

It’s a holistic approach to house shopping for people who want to leave the big city hassles, but not the city experience. It’s for folks who want to live in a neighborhood where the barista knows their name.

James and Samantha Cordon filled out the questionaire by Suburban Jungle Realty Group, a Manhattan-based real estate brokerage geared exclusively to helping New York City dwellers adjust to a move to the ’burbs.

According to U.S. Census Bureau data, about 41,450 New Yorkers crossed the Hudson River to plant their roots in the Garden State in 2011.

The Cordons were among the 2012 crop of transplants. They lived in the Park Slope section of Brooklyn for 10 years. He’s originally from Minnesota, and she grew up in Randolph. They met in college at Colgate University, found jobs in Manhattan, married and moved to Brooklyn.

“It was a great neighborhood,” James Cordon said. “It had old brownstones, great restaurants, great bars, great everything.”

But then along came their daughter, “and as soon as she started to walk,” he said, “we felt the walls collapse on us. It was a space issue.”

Alison Bernstein, founder of Suburban Jungle Realty Group, said a significant portion of her business comes from Brooklyn, the once-trendy but now almost-as-pricey alternative to Manhattan.

“We work with a significant number of Brooklyn buyers,” she said, “and typically what I hear is, ‘I don’t want to be in the suburbs, I want a Brooklyn-y type environment.’ ”

She points them north to Connecticut, east to Long Island, and west toward New Jersey.

“New Jersey is always very popular with us,” she said, mentioning towns like Montclair and Cedar Grove that have a chic feel and easy access into Manhattan.

The Cordons found their home in Glen Ridge and moved from a “great”-but-cramped condo into a six-bedroom house with a fenced-in yard.

“We loved Park Slope,” said Cordon, a financial adviser with Morgan Stanley, “but we also loved Glen Ridge because it had a nice urban vibe that hearkened back to Brooklyn.”

Posted in Demographics, Economics, New Jersey Real Estate | 147 Comments

North Jersey Contracts – February 2013

Posted on March 2, 2013 by grim

Here it is! The first look at pending home sales (contracts) for Northern NJ.

(Source GSMLS, except Bergen- NJMLS) – Updated with 2011 Data

February Pending Home Sales (Contracts)
——————————-

Bergen County
February 2011 – 490
February 2012 – 564
February 2013 – 682 (Up 20.9% YOY, Up 39.2% Two Year)

Essex County
February 2011 – 221
February 2012 – 313
February 2013 – 364 (Up 16.3% YOY, Up 64.7% Two Year)

Hunterdon County
February 2011 – 90
February 2012 – 92
February 2013 – 126 (Up 40.0% YOY, Up 40.0% Two Year)

Morris County
February 2011 – 264
February 2012 – 320
February 2013 – 403 (Up 25.9% YOY, Up 52.7% Two Year)

Passaic County
February 2011 – 138
February 2012 – 153
February 2013 – 215 (Up 40.5% YOY, Up 55.8% Two Year)

Somerset County
February 2011 – 176
February 2012 – 201
February 2013 – 270 (Up 34.3% YOY, Up 53.4% Two Year)

Sussex County
February 2011 – 68
February 2012 – 106
February 2013 – 125 (Up 18.0% YOY, Up 83.8% Two Year)

Union County
February 2011 – 204
February 2012 – 273
February 2013 – 292 (Up 7.0% YOY, Up 43.1% Two Year)

Warren County
February 2011 – 59
February 2012 – 69
February 2013 – 92 (Up 33.3% YOY, Up 55.9% Two Year)

Posted in Economics, Housing Recovery, North Jersey Real Estate | 24 Comments