The second quarter market report from John Turpin of Turpin Realtors in New Jersey makes for interesting reading. John says " I am sending along our latest market report highlighting home sale trends in our market, which vary considerably from town to town. I trust that you will find this information useful!"
With half of 2018 under our belts, it would appear that our local real estate market is cooling relative to past performance. Though there are certainly bright spots, a majority of the thirty towns we study posted fewer home sales through June 30 than they had during the same period last year. For perspective, at this time last year, 62% of towns in our market were ahead of their prior year’s performance; this year, just 43% of towns showed such improvement.
Return of the Rural Village
Rising prices to the east continue to drive buyers westward, where they seek homes within walking distance of restaurants and shops. Numerous “rural villages” in our market fit the bill and continue to trend in popularity with such buyers, in contrast to the more expansive townships that surround them (and sometimes share a name!). For example, improvements in the Town of Clinton, Lebanon Borough and Mendham Borough were significantly greater than in their corresponding townships. Peapack-Gladstone, which is comparable in many ways to a township, yet with the benefits of an increasingly vibrant downtown, is also among the communities that posted notable gains... in this case a 44% increase in year-to-date sales (June 30) over the same period last year.
As has been the case for some time, communities on the eastern side of our market that have bustling downtowns and efficient mass transit to Manhattan continue to perform reasonably well. At the head of the class mid-way through 2018 is Madison, with gains in all price segments, including twice as many sales between $1-2 million as compared the same time last year. Florham Park also showed improvement, as did Chatham Township in the $1 million-plus segment. Sales in Chatham Borough are off considerably (16.5%) which is most likely a result of an extreme lack of inventory (2.2 months supply under $1 million) and significant increases in the average sale price. While formerly scorching-hot markets in Millburn and Summit cooled a bit, both showed striking increases in sales between $2-3 million (56% and 27% respectively).
Pricing is Key
As much as we enjoy highlighting positive trends, the fact is that numerous towns in our market are experiencing a decline in sales. Bernardsville, Far Hills, Harding, Mendham Township, New Providence and Tewksbury all exhibit high inventory coupled with a year-to-date decline in sales of more than 10%. In markets like these, where there are far more homes for sale than home seekers, realistic pricing is the best way to capture an increasingly hard-to-find buyer.
Establishing discernible trends on a quarterly basis can be a challenge. Many towns simply do not have adequate data points to generate reliable information. Additionally, experience shows that what may appear a significant loss in one quarter will often be made up later in the year. Simply put, partial-year results can be unreliable. An experienced real estate professional can help you assess the particulars that are relevant to your unique circumstance. I hope you will not hesitate to call on one of the fine agents at Turpin Realtors for expert advice and diligent service.
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