We have good news to share about the 2016 NJ Spring Housing Market and our local communities, especially Summit, New Providence, Berkeley Heights, Mountainside, Millburn/Short Hills, Maplewood, South Orange and The Chathams. Yesterday The Emma Team attended the Otteau Evaluation Group’s 2016 NJ Spring Housing Market Seminar which covers everything from our local NJ economy to home prices. Here are some key takeaways.
One of the strongest impacts on our housing market is job creation. NJ has been behind the rest of the US in adding jobs but that’s finally turning around. Last year NJ added 81,500 non-farm jobs, the highest number by far since 2001. More good news, the NYC Metro saw the largest job growth in the entire US last year which explains the increasingly hot market conditions in our Midtown Direct Train line towns like Summit, New Providence, Maplewood, South Orange, Millburn/Short Hills and The Chathams.
Low interest rates are another huge influence on the strength of the housing market and can be attributed to why we haven’t experienced another recession yet. The federal reserve is to thank for that but we’re not sure how much longer this will last. They stated that rates would increase in 2016 but that has not happened. Otteau is forecasting we will start seeing a rise again in 2017.
2015 Sales Pace Increased by +17% vs 2014. It was the second best year for home sales in NJ since 2005. About 105,468 homes sold in 2005 at the height of the real estate bubble. 97,925 homes sold in 2015, a dramatic increase compared the previous 9 years. There have been 18 straight months of increased home sales in NJ.
Unsold inventory, which is another important indicator of the health of the housing market, is at a low with 18,000 fewer homes for sale than at the peak of the housing crisis in 2008.
Home prices are still rising and the state is projected to see an average increase of 4% in 2016, the second highest since 2005. This all encompassing graph charts home prices since 1971 projecting out to 2023.
For a local look at home prices, here is a taste of what is forecasted for some of our favorite communities in 2016. Good news all around, Berkeley Heights, Mountainside and Springfield are projected to see a 6% increase from last year, while New Providence, Summit, Westfield and Cranford may see up to a 7% rise. Don’t see your town listed? Contact us for an analysis of your town’s housing market.
Finally, many of the strongest housing markets in all of NJ fall within The Emma Team’s service area including Maplewood, South Orange, The Chathams, New Providence, Cranford, Fanwood and Millburn/Short Hills. Here is a list of the top 20 housing markets based on Months Supply of Inventory (MOS). MOS basically refers to the number of months it would take to sell all the inventory in the town at any given time. Anything below 7 months is considered a seller’s market.
Want to know more? Contact us for a copy of the full presentation.