While some buyers and investors continue to sit on the fence and try to fool themselves that we are not in a housing market recovery, they can expect to pay more sooner rather then later and may talk themselves right out of the game. The statistic itself that New Jersey’s year-to-year foreclosure notices increased by 42% this year is misleading because of the Robo-Signing issues last year. There was also a loan forebearance that was enacted after Hurricane Sandy by banks and foreclosures were not allowed to be pursued. That said, property values in NJ are up 4% year over year.
Let’s talk about Northern NJ. In Hoboken, I feel bad for the foreclosure and short sale listings that come on the market. They will get hit with so many offers, the sellers won’t know what to do with them. In Northern NJ, distressed sales are selling for about 5% under market value. That’s not enough of a discount to brag about anymore. In Hoboken and downtown Jersey City, sales are being recorded over 100% of asking price.
President of Otteau Valuations Group who tracks NJ housing market statistics say that the housing market is so strong right now that it’s starved for inventory. If any distress come to market, the market will swallow them up without even chewing on them.
That’s a bold statement from a group who is normally a bit more conservative on their market expressions. As mentioned earlier, homes in foreclosure are selling for about 5% below market value and are not distressing the market.
The condo market along the Gold Coast remains hot also and it’s only going to get stronger. The question is will it continue to sustain itself. I think there are enough reasons to believe that we have a ways to go before we have to start worrying about making this market unaffordable. If you have a good property along the coast and they are well situated, there are more people then you think that want to place their money somewhere.
What is more impressive is that 60% of the buyers are from overseas, many from China, Korea, and Russia. Without these buyers, we would have mediocrity. The median price for Hudson County condos is up 17.6% since last year.
Prices are up, buyer confidence is at a 6 year high and things are going well…..all while mortgages are still tough to get. This is a healthy climb in the economy and more steam is needed to recover fully.