buy a Millburn-Short Hills home in 2013, you may be wondering if you should buy now while home prices and mortgage rates are reasonable - or wait, and see what may be available a few months down the road.
Here are my thoughts on our New Jersey real estate conditions, and how they impact first-time home buyers.
We are seeing a lot of variety! Overall, home prices are up from a year ago, and the list-to-sales ratios show that prices are firming. Yet the amount of time a home spends on the market can be a short as 10 days or as long as several months. You can get an idea of how local markets like Livingston, Chatham, and Summit are faring by looking at my Market Statistics page. Free! Take a peek.
Meanwhile, New Jersey has some shadow inventory to work through. Some of these distressed homes may experience foreclosure. Others may conclude a short sale before reaching foreclosure, which is less damaging to surrounding home values. Inman News reports that shadow inventory nationwide is down 28% from its peak, but New Jersey, Florida, New York, California and Illinois have the lion's share of this market.
Anywhere there are foreclosures, home prices dip; but not all delinquent mortgages translate into foreclosure. Short sales are accounting for a greater share of our distressed market. Since short sales are based on fair market value, and the homes are in better condition than foreclosures, they do not harm area home values. It would be inaccurate to assume that having a distressed inventory means automatic price retreats. However, home price appreciation will likely be gradual this year, as we have seen over the past 12 months.
The gamble that first-time home buyers make in waiting, is twofold: home prices may rise, and mortgage interest rates may rise. Gradual increases in both have been predicted by economists. A one-two punch of increases will impact mortgage qualification for those who are just within bounds, and make home buying more expensive for all concerned.
Bottom line: you can't predict the market, but you can base your decisions on the facts you have today. You can also use my professional guidance to help you find the best opportunities in New Jersey real estate! I will be happy to share the newest home listings and latest price trends for the neighborhoods you'd like to call home. Contact me today, and let my experience work for you!
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