New Jersey Real Estate Report

From CNBC:

April existing home sales drop, marking three straight months of declines

Sales of existing homes dropped 2.7% in April from March to a seasonally adjusted annualized rate of 5.85 million units, according to the National Association of Realtors.

It was the third straight month of declines, the group said.

Sales were 33.9% higher than April 2020, but that comparison is an anomaly because the housing market and economy shut down at the start of the pandemic. Housing then rebounded strongly last summer. Sales were still 11% stronger than April 2019.

“I would say it is hot, that is the one word description even with the sales decline,” said Lawrence Yun, chief economist for the Realtors. For every listing there are 5.1 offers. Half of the homes are being sold above list price.”

The supply of homes for sale at the end of April was down 20%. There were 1.16 million homes for sale, representing a 2.4-month supply at the current sales pace.

High demand and rock-bottom supply continued to push prices higher. The median price of an existing home sold in April was $341,600, an increase of 19.1% from April 2020. That is both the highest median price on record and the largest annual increase on record.

Much of that large increase in the median price is due to the mix of homes that are selling. There is far more activity on the higher end of the market, where supply is more plentiful, and very little activity on the low end, where the shortage is most severe.

From CNBC:

Homebuyers are applying for ever bigger mortgages as home prices soar

Sky-high home prices mean demand for ever bigger mortgages, but those prices may also be causing a pullback in homebuying overall.

Mortgage applications to purchase a home fell 4% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Volume was just 2% higher than the same week one year ago, when the housing market was just starting to come back after the pandemic shut it down.

“A decline in purchase applications was seen for both conventional and government loans,” said Joel Kan, an MBA economist. “There continues to be strong demand for buying a home, but persistent supply shortages are constraining purchase activity, and building material shortages and higher costs are making it more difficult to increase supply.”

The extreme shortage has prices continuing to climb at the fastest pace in over 15 years, and as a result, average purchase loan balances are climbing in tandem. Last week, that average hit $411,400 — the highest since February.

From the Star Ledger:

What happens if the appraisal is lower than your offer? Here’s what N.J. real estate agents say.

More homes are under-appraising in this quick-changing market for two reasons, he said. “The first being there are no comparable sales to support the purchase price. Secondly, there are a ton of homes under contract that have not closed yet therefore the increase in some home prices are not accurately reflected until the comps actually close.”

…

James Hughes, a broker-salesman with Compass in Montclair, said his clients are typically offering to bridge the appraisal gap to a set point – $10,000, $20,000 or even $50,000.

Updated Vaccination by Age Range for NJ:
5/8 vs 5/13

At Least 1 Dose
Total Pop: 9.2m
Total 1st Doses: 4.5m – 49% of total pop (Up from 48%) – Bloomberg reporting 55%

16-17 – 240k population – 45k dosed – 19% 1 Dose (Up from 18%)
18-29 – 1.5m population – 495k dosed – 33% 1 Dose (Up from 32%)
30-49 – 2.4m population – 1.2m dosed – 50% 1 Dose (Flat from 50%)
50-64 – 2m population – 1.3m dosed – 65% 1 Dose (Flat from 65%)
65-79 – 1.1m population – 1.1m dosed – 100% 1 Dose (Flat from 100%) 
80+ – 415k population – 360k dosed – 87% 1 Dose (Up from 85%)

From Property Shark:

COVID-19 was a complete game-changer in many areas, including the real estate market. Many New Yorkers sought alternatives to city life and, although prices for homes in New York City remained steady, the number of transactions dropped by 28% in NYC between March 2020 and February 2021. 

Residents found the things that made city life unique and exciting were mostly shut down temporarily, and as companies switched to remote work, time spent commuting was no longer a factor. As a result, areas outside the city soared in popularity with homebuyers.

To see which areas won out in the dash for the suburbs, we analyzed and ranked NYC’s suburbs based on the increase in home sales in 2020 compared to 2019.

Updated Vaccination by Age Range for NJ:
4/30 vs 5/8

At Least 1 Dose
Total Pop: 9.2m (UPDATED FOR NEW CENSUS)
Total 1st Doses: 4.4m – 48% of total pop (Up from 46%) – Bloomberg reporting 54%

16-17 – 240k population – 44k dosed – 18% 1 Dose (Flat from 18%)
18-29 – 1.5m population – 484k dosed – 32% 1 Dose (Flat from 32%)
30-49 – 2.4m population – 1.2m dosed – 50% 1 Dose (Flat from 50%)
50-64 – 2m population – 1.3m dosed – 65% 1 Dose (Up from 63%)
65-79 – 1.1m population – 1.1m dosed – 100% 1 Dose (Up from 91%)
80+ – 415k population – 352k dosed – 85% 1 Dose (Up from 83%)

34 NJ breweries now offering free beer for COVID vaccines

Another 21 breweries in the state are offering free beer to anyone over the age of 21 who gets their first COVID-19 vaccine in May, according to Gov. Phil Murphy, bringing the total list of participants to 34 breweries.

“Many more craft breweries up and down the state have asked to be part of our ‘Shot and a Beer’ program,” the governor said during his daily COVID-19 press briefing on May 5.

There were an initial 13 participants announced on Monday, in what became a national headline: Get a vaccine and win a free beer.

It’s part of an aggressive marketing effort under “Operation Jersey Summer” to fully vaccinate 4.7 million New Jersey adults by June 30. As of May 5, the state fully vaccinated 3.2 million adults who live, work or study in the state.

“Let’s keep our eye on the finish line. This is a marathon, and we have now passed … the 20-mile mark. But it’s always that last 6.2 … that is the biggest test, and the hardest,” Murphy said.

From the Star Ledger:

The average price of an N.J. home is $100K more than what it was last year

The average price of a single family home in New Jersey has increased almost $100,000 in the past year, according to data from New Jersey Realtors.

The average home price for the first quarter of 2021 was $500,628 or 24% more than the $403,785 for the first quarter of 2020, the data shows.

“It has jumped dramatically,” said Robert White, President-elect of NJR and Managing broker at Coldwell Banker Realty in Spring Lake.

The price increase is being driven by low inventory and eager buyers.

“With the current inventory situation and the buying frenzy, you’re seeing … many homes selling over asking price in today’s market and that is forcing values to increase because appraisers are coming out and appraising at those higher numbers,” he said.

Updated Vaccination by Age Range for NJ:
4/27 vs 4/30

At Least 1 Dose
Total Pop: 9.2m (UPDATED FOR NEW CENSUS)
Total 1st Doses: 4.3m – 46% of total pop (Flat from 46%) – Bloomberg reporting 52%

16-17 – 240k population – 43k dosed – 18% 1 dose (Flat from 18%)
18-29 – 1.5m population – 473k dosed – 32% 1 Dose (Flat from 32%)
30-49 – 2.4m population – 1.2m dosed – 50% 1 Dose (Up from 48%)
50-64 – 2m population – 1.2m dosed – 60% 1 Dose (Down from 63%)
65-79 – 1.1m population – 1.0m dosed – 91% 1 Dose (Flat from 91%)
80+ – 415k population – 344k dosed – 83% 1 Dose (Up from 82%)

From the Star Ledger:

N.J. will see ‘accelerating opening up of the state’ with announcements soon, Murphy says

Gov. Phil Murphy said Wednesday he’ll have “more news on Monday” about further lifting New Jersey’s coronavirusrestrictions after news that neighboring New York is taking big steps to get rid of some rules for dining at bars and restaurants.

Murphy reacted to New York Gov. Andrew Cuomo announcing people can get served at bars in New York City beginning Monday and that outdoor and indoor curfews for bars and restaurants in the city will both be lifted by the end of May.

“You’re going to see us accelerating opening up of the state,” Murphy said during his latest COVID-19 briefing in Trenton. “There’s just no other way to put it. We’ll have more news on that on Monday.”

Murphy cited the likelihood of people traveling to New York or Pennsylvania restaurants or bars if restrictions in those states differ greatly from New Jersey.

”We don’t want that and New York doesn’t want that,” he said.

Updated Vaccination by Age Range for NJ:
Morning of 4/22 vs Morning of 4/27

At Least 1 Dose
Total Pop: 8.9m (Not adjusted for new census data)
Total 1st Doses: 4.1m – 46% of total pop (Up from 44%) – Bloomberg reporting 49%

16-17 – 230k population – 41k dosed – 18% 1 dose (Up from 17%)
18-29 – 1.4m population – 451k dosed – 32% 1 Dose (Up from 28%)
30-49 – 2.3m population – 1.1m dosed – 48% 1 Dose (Up from 46%)
50-64 – 1.9m population – 1.2m dosed – 63% 1 Dose (Up from 60%)
65-79 – 1.1m population – 1.0m dosed – 91% 1 Dose (Up from 89%)
80+ – 400k population – 328k dosed – 82% 1 Dose (Up from 78%)

From HousingWire:

Home prices soared in March amid record demand

This is getting to be a problem. Home prices in the U.S. soared 18% year-over-year in March 2021 to a median of $356,000, according to a report Redfin released Friday that provided stark evidence of a housing market where demand greatly exceeds supply.

Homes sold in March were on the market for 21 days, per the report, the shortest period between listing and sale since 2012. Forty-six percent of homes sold within a week after the hitting the market.

At first, such high demand was leading to record home sales. A National Association of Realtors’report from 2020’s end found the highest volume of home sales since 2006. But the NAR reported this week that home sales in March fell for the second month in a row as inventory plunged and home prices climbed to record levels.

Where matters are becoming problematic is that high demand is now a direct cause for the low inventory.

For months there was a question in the market “about whether fear of coronavirus infection was keeping homeowners from selling,” stated Daryl Fairweather, chief economist at Redfin.

But with a third of U.S. adults now vaccinated, Fairweather explained, it’s increasingly clear that people don’t fear contact with strangers as much as not having a new home to move into.

Another reason for low inventory – active listings were down 47% in March compared to March 2019, per the report – are low mortgage interest rates. Freddie Mac reported Thursday that interest on an average fixed-rate mortgage is now less than 3%. Instead of looking for a new home, Fairweather found, homeowners are just refinancing the mortgage payment on their current one.

Updated Vaccination by Age Range for NJ:
Morning of 4/19 vs Morning of 4/22

At Least 1 Dose
Total Pop: 8.9m
Total 1st Doses: 3.9m – 44% of total pop (Up from 43%) – Bloomberg reporting 47%

16-17 – 230k population – 39k dosed – 17% 1 dose (Up from 0%)
18-29 – 1.4m population – 390k dosed – 28% 1 Dose (Up from 24%)
30-49 – 2.3m population – 1,053k dosed – 46% 1 Dose (Up from 41%)
50-64 – 1.9m population – 1,131k dosed – 60% 1 Dose (Up from 58%)
65-79 – 1.1m population – 975k dosed – 89% 1 Dose (Down from 97%)
80+ – 400k population – 312k dosed – 78% 1 Dose (Down from 95%)

From the Star Ledger:

It’s Game of Homes in N.J.’s wild real estate market

Last week’s Letter From Your Editor included a note about how our reporters were looking into the residential real estate market in New Jersey and looking for agents, buyers, sellers and others to share their stories.

Whoo, boy, did you folks share some stories.

Fistfights at the open house. Cash incentives out of the pocket of agents hoping to close a sale. Full price, sight-unseen offers. Love letters, free Netflix, and tacos for everyone! It’s a full-on Game of Homes out there.

And this isn’t even counting the houses that change hands before they ever have a sign in the yard — check out your town’s Facebook or Nextdoor page. If your school district is any good, it’s a safe bet buyers are in there schmoozing around looking to get an early chance at a deal.

My husband and I are watching all this warily, as we’re getting closer to time-to-downsize, and thinking about how bizarre the market was the last time we sold and bought.

Back in 2004, the housing market in Ocean County was flush with easy mortgages and bloated with folks from Staten Island moving to Jersey. The market was so competitive that the first buyer’s agent knocked on the door before the house even hit the MLS. She tried to wheedle her way in for an early look while I was shampooing carpets with a toddler underfoot. It didn’t work.

But within a week of listing, we had multiple offers above asking price. When one of the bidders wrote us a letter complimenting the genuinely terrible faux-finish paint job I’d done on the dining room, I knew things were getting ridiculous.

Fortunately for us back then, we were moving from rapidly-developing Jackson to a still mostly rural part of Gloucester County, where housing prices and taxes were lower. We knew our house would sell quickly, and that we could afford to buy the next one.

Now, with every corner of the state sizzling — even in the tiny, not-upscale Delaware Bay town where my Mom lives, knock-down cottages are commanding big money — the next move isn’t so clear.

How hot is NJ’s spring real estate market? Cash offers, bidding wars, forgone inspections

With two children and a third on the way, Heather and Patrick Healy decided their 1,900-square-foot home in New Providence was just too small. Knowing the real estate market was hot early this year, the couple figured looking in the million-dollar range would give them a cushion. But the market was just too tough.

They lost out in bidding wars for homes in Chatham and Basking Ridge before snaring a Basking Ridge 4,300-square-foot colonial revival built in the 1980s. The purchase price: $1,082,000.       

“There’s no room for negotiations,” said Heather Healy, 34. “You have to be willing to pull the trigger right away.”

Welcome to the COVID pandemic real estate market in New Jersey, where homes are selling as soon as they are listed, often with multiple offers. Low inventory — coupled with the increased appeal of suburban living  — has created a fiercely competitive market for buyers. Even as COVID restrictions about showing homes lifted, properties are still not coming on the market.

“It’s crazy. It’s really crazy,” said Ann Marie Battaglia, a real estate agent at KL Sotheby’s International Realty in Madison.