To do a current Bergen County market update, I have to go back 30 days. If you look at what I wrote about the market on March 25th, you’ll see that we were holding our own. The data from the New Jersey MLS was nearly identical comparing 2020 to 2019. While this was true, I also saw storms on the horizon.
Since then things have changed. We began the lock down and in a matter of a few days days the US economy was closed. Real estate is among essential services so we’ve been moving forward.
Let’s Look At The Facts
Here’s the New Jersey MLS data for March 15th to April 15th comparing 2020 to 2019:
- Active – 903 to 2,503
- Attorney Review – 448 to 1,091
- Under Contract – 466 to 882
- Withdrawn – 372 to 289
- Price Changes – 222 to 667
How Bad Is this?
Although Corona virus has a definite effect on the market, it did not stop Bergen County real estate. We’ve lost what I call optional buying. There are people who don’t have to move now. It’s optional.
There’s still plenty of time to get into a house by the start of school in September (this is over half of all sales). It usually takes 60 days to close on a house. You can do it in 45 days if you’re properly prepared.
Back it up 60 days. That’s July 1st and 45 days takes you to July 15th. Plenty of time to wait it out while you’re watching the market. Get ready for lots of homes and buyers in another 4-6 weeks.
So how bad is this? Interest rates are great at +/- 4% by a little (good for buyers) and inventory is thin (good for sellers). The primary difference is that any homeowner or buyer out there now is serious. So how bad is this really? It’s just different.
Bergen County Market Update
The bottom line is that there is still activity. Just not as much as you’d see in a normal spring market. Consider a big picture view. This is an abnormal time. It is a man made forced recession. The best economy the US has seen was closed down in 2-3 days. That’s abnormal.
The President announced today that the economy will begin opening up now. While it will take a while for us to heal the economy fully, there is tremendous pent up demand. Imagine where we’ll be in 1 month.
Here’s the key ingredient most people have missed – Pricing. I have not seen an unusual degree of price reductions and NJMLS figures prove this. Taken as a percentage of actives, price changes are 25% in 2020 and 27% in 2019. Wouldn’t you expect values to nosedive as they do in negative times? Remember the big picture – this is an abnormal time. Economic fundamentals remain strong. The Federal Government made sure of this.
Buying and Selling Now
Yes you can buy and sell now. It’s just a different process. Everything is done through the internet with a few exceptions. Buyers will ask for at least 1 visit to make certain this is the home they want and home inspectors need to come inside. Plus I need my marketing team in to do photos, 3D Matterport tour and floor plans. If you are not comfortable with this, wait it out.
Data proves that we are moving at the same pace as last year. Look at the price change figures; they’re nearly identical. Now look at the ratio of active listings for sale against those under contract:
- 2019 903 to 466 – 2,29 to 1
- 2020 2,503 to 1,091 – 1.94 to 1
I know this sounds crazy but we’re actually doing better in 2020. It’s just that there are fewer transactions happening so far this year. That is going to change once Bergen County is opened up.
The Bottom Line
You can see now that the market is moving forward. Homeowners have an envious position compared to what’s coming. When the market is flooded with homes, this advantage is gone. Buyers can save a lot now because services such as movers and inspectors are competing for your business. Plus you won’t bump up against multiple buyers for the house you want as you will later on. Right now there truly is opportunity for both that will disappear soon
Weichert’s been doing 3D Matterport tours for years (aka virtual tours) as well as remote transactions from document signings to Attorney amendments. From our perspective the only change is with actual showings. Now we’re doing them virtually.
Call or text me at 201-741-8490 if you have questions or want a market report. As they say, I’m ready when you’re ready.