Little early, but I’m making the call.
The North Jersey 2009 Spring Market is a complete bust
There has been absolutely no sign of increased sales, heck there isn’t even a sign of a bottom. Sorry folks, but this downturn has much longer to go.
While we usually discuss home sales on a closed basis here (looking backwards by 2-3 months) it is often helpful to gauge home sales by looking at contract sales (signed contracts to buy). This measure is very similar (if not exactly the same) as the National Association of Realtors (NAR) pending home sales index. While contract sales are a more recent indicator than closed sales, it is a noisier measure. A percentage of contract sales don’t make it to closing, and that percentage does tend to vary. Closed sales tend to see a less significant revision, which are typically due to data entry mistakes or not logging a closed sale in a timely manner.
There are no bright spots in the February 2009 contract data. Warren did see a bit of a year over year increase in February, but at these depressed levels it is tough to know whether this is market improvement or just noise as we skid further downhill. The biggest improvement in Warren County was in Phillipsburg, where contracts went from 9 last year to 13 in 2009. This is likely due to the severe price declines seen in Phillipsburg. Median contract price was down more than 50% year over year, with average prices falling 34% over that same period. This is similar to what we saw in January, with severely depressed areas seeing the most improvement in terms of sales.
Given the deterioration over the first two months of the year, it is clear that 2009 will not be the year real estate bottoms in New Jersey. The spring market tends to set the pace for the year that follows, and if January and Febuary are any indication, we’re in for further deterioration.
Febuary North Jersey Contract Sales
Bergen
(NJMLS)
February 2007 – 762
February 2008 – 520
February 2009 – 441 (Down 15.2% YOY, Down 42.1% 2xYOY)
Essex
(GSMLS)
February 2007 – 423
February 2008 – 325
February 2009 – 248 (Down 23.7% YOY, Down 41.4% 2xYOY)
Hunterdon
(GSMLS)
February 2007 – 94
February 2008 – 102
February 2009 – 58 (Down 43.1% YOY, Down 38.3% 2xYOY)
Morris
(GSMLS)
February 2007 – 449
February 2008 – 355
February 2009 – 270 (Down 23.9% YOY, Down 39.9% 2xYOY)
Passaic
(GSMLS)
February 2007 – 263
February 2008 – 187
February 2009 – 177 (Down 5.3% YOY, Down 32.7% 2xYOY)
Somerset
(GSMLS)
February 2007 – 323
February 2008 – 252
February 2009 – 172 (Down 31.7% YOY, Down 46.7% 2xYOY)
Sussex
(GSMLS)
February 2007 – 171
February 2008 – 122
February 2009 – 118 (Down 3.3% YOY, Down 31.0% 2xYOY)
Union
(GSMLS)
February 2007 – 349
February 2008 – 261
February 2009 – 212 (Down 18.8% YOY, Down 39.3% 2xYOY)
Warren
(GSMLS)
February 2007 – 103
February 2008 – 60
February 2009 – 67 (Up 11.7% YOY, Down 35.0% 2xYOY)
Year-to-Date North Jersey Contract Sales
Bergen
(NJMLS)
2007 – 1444
2008 – 996
2009 – 804 (Down 19.3% YOY, Down 44.3% 2xYOY)
Essex
(GSMLS)
2007 – 787
2008 – 547
2009 – 474 (Down 13.3% YOY, Down 39.8% 2xYOY)
Hunterdon
(GSMLS)
2007 – 199
2008 – 196
2009 – 114 (Down 41.8% YOY, Down 42.7% 2xYOY)
Morris
(GSMLS)
2007 – 859
2008 – 636
2009 – 484 (Down 23.9% YOY, Down 43.7% 2xYOY)
Passaic
(GSMLS)
2007 – 673
2008 – 468
2009 – 361 (Down 22.9% YOY, Down 46.4% 2xYOY)
Somerset
(GSMLS)
2007 – 635
2008 – 447
2009 – 322 (Down 28.0% YOY, Down 49.3% 2xYOY)
Sussex
(GSMLS)
2007 – 305
2008 – 223
2009 – 205 (Down 8.1% YOY, Down 32.8% 2xYOY)
Union
(GSMLS)
2007 – 651
2008 – 449
2009 – 426 (Down 5.1% YOY, Down 34.6% 2xYOY)
Warren
(GSMLS)
2007 – 206
2008 – 129
2009 – 119 (Down 7.8% YOY, Down 42.2% 2xYOY)