Hope on the Horizon for the Summer Market

BY COLLEEN KING OLIVER

As expected, the housing market numbers in April were down in almost every category, except price. But as the state slowly started to reopen in June, cautious optimism was in the forecast for the summer.

The spring market took the hit at the height of the pandemic, with some sellers hesitant to list and some buyers hesitant to make the next step.

In April, the median sales price for all properties was $333,000, up 14.4 percent over April 2019. Homes are moving quickly, with the average property spending just 61 days on the market, a 9 percent decline since April 2019. The pandemic did no favors to already-low inventory, either.

It’s a case of supply and demand,” said 2020 New Jersey Realtors® President Angela Sicoli about the rise in costs. “Far before this pandemic, we had an inventory shortage throughout the state and now, compounded with a large percentage of people who were ready to sell in March but put their plans on pause, you are seeing buyers who have far less to choose from. With only a small pool of homes to choose from buyers are sometimes paying slightly above asking or finding themselves in a situation with multiple offers on the property.

Throughout the state, when compared to April 2019, new listings were down a staggering 63.1 percent, with only 7,272 recorded throughout the state for the month. Pending sales for that same period dropped 46.7 percent. However, closed sales were only down 20.7 percent, indicating the pipeline of deals in progress from before the lockdown has extended through at least some part of April. There were just 35,714 homes for sale in New Jersey in April, down 35.6 percent from last April.

While the majority of the conversation has focused on the downturn of the market due to the pause on active selling and buying, anecdotally, some markets saw an upturn from clients wanting to leave the city for the family-friendly suburbs while not tethered to a physical commute. Particularly, northern New Jersey counties have seen high prices rise even higher as people migrate out from the city and scoop up available inventory.

While the rental market for the summer initially looked uncertain, by all accounts it’s been busy, with consumers more confident their vacations will be able to happen, albeit a little different than previous years.

In mid-June, New Jersey entered Stage two of Gov. Murphy’s Restart and Recovery plan. Open houses, which had been previously banned under Executive Order 107, were permitted, a strong sign of forward momentum. Only time will tell if the loosened restrictions will spur buyer and seller activity, but for the first time in several months there is hope on the horizon.

As always, you can read the full housing data reports at njrealtor.com/data and our COVID-19 FAQs and resources are updated at njrealtor.com/covid19.