Market still hot, but NJ single-family home sales down in August
Sales of single-family homes in the Garden State declined by more than 10% in August over one year ago, according to the latest data from New Jersey Realtors, but prices remain high for all properties, and single-family closed sales to date are still up more than 13% compared to this point in 2020.
Interest is still strong, although it has shifted somewhat from the flight to the suburbs and Jersey Shore that characterized the housing market at the height of the COVID-19 pandemic, said Robert White, NJ Realtors president-elect.
Inventory has been trending in an upward trickle quarter after quarter in 2021, White said, but remains lacking overall.
"Now, I think, we're still seeing properties move, but because of the lack of inventory, there's just not enough out there," he said. "Because again, there are also a lot more buyers in the market these days."
While that may be true, White said some buyers may be feeling a bit of fatigue by now at being outbid time and again, and could be stepping back from their searches.
And not only are they being outbid, but they also continue to overbid; NJ Realtors reported median sales prices are up 19% year-to-date across all markets.
"They've lost out on so many opportunities, presenting or writing offer after offer only to be rejected, that they get that sense like, 'well, let me just wait,'" White said, citing sales still clocking in at anywhere from 7 to 12% above asking price, on average. "While we're still seeing multiple offers, we're not seeing 20, 25 like we used to, but we're still seeing 12 to 15."
Following long pandemic delays, White said new home starts have finally picked up again and are catching up with early 2020 levels, as pricing for certain materials drops back down and wait times decrease.
But the difficulties in securing single-family properties have seemingly pushed many toward townhouses and condo units, for which NJ Realtors reported sales were up almost 11% in August versus the same month in 2020.
"When they couldn't get an offer accepted after numerous attempts, they went to the townhouse/condo market, the alternative, because again, remember a lot of these buyers are first-time homebuyers," White said.
Looking ahead, White sees continued growth across the board in the fourth quarter and well into 2022.
He said there is no "bubble" to burst, unlike the mid-2000s housing boom, and while interest rates could increase, they are still historically low — for now.