How is real estate in Bergen County is a question I’m asked more often than I can count. Everyone, it seems, wants to know how the market is doing. This is especially true at the start of a new year.
Let’s use the best data source, the New Jersey MLS, and the most popular residential purchase, the single family home.
Bergen County Overall
- 3% More Sales
- 1% Appreciation
- Marketing Time is Flat
- Lower rates brought out buyers
One word explains 2019 – stable. Bergen County overall had 3% more sales (6,921 to 7,121 or +200) with 7/10 of 1% appreciation. The average sales price went up by $4,264 from $600,349 to $604,613. The median sales price was stable too; it rose from $495,000 to $497,000.
While we sold more homes with low inventory, buyers were not over paying. The message is clear: There has to be value for a buyer to act. As a result, the law of supply and demand is limited. Just because there aren’t enough homes does not mean prices will skyrocket.
The time it took to market a home was pretty flat too at 61 to 59.7 days. It’s been running at 2 months for the past few years.
What did change in 2019 is mortgage rates. They lowered as you moved further into the year. As a result, many buyers jumped off the fence and into home ownership. Thus 3% more sales in 2019.
The bottom line is a stable and solid real estate market. This is positive for everyone.
Real Estate Market Segments
Let’s break things down to different parts of the market so you can see how your market did. Homes up through $250,000 were eliminated because almost every one was either a foreclosure, short sale or in need of major renovation. Most were purchased by investors. These houses are rarely purchased by non-investors because they need major renovations.
- $500-$1 million
- $1-1.5 million
- 1.5-2 million
- 2-3 million
- $3 million+
Most of the market is at $250,000 – $1 million or 88% of all sales. $250-500,000 has most of the 1st time buyers. These 3,442 sales represent 48% of the market. Not far behind is $500,000 – $1 million with 2,858 sales for 40% of the market. Both groups have 4% more sales and virtually no change elsewhere..
Once you cross the $1 million mark, things drop off dramatically.
- $1-1.5 million = 429 sales or 6%
- $1.5 – 2 million = 109 sales or 1.5%
- $2-3 million = 53 or 1% (rounded off)
- $3 million+ = 24 or .5% (rounded off)
For this upper tier group, things were flat until you reach $3 million and up. Then we see major positive changes.
The high end luxury home made a major come back in 2019. Homeowners adjusted to the market and houses sold. For years this market has languished due to, in my humble view, ridiculous asking prices and poor marketing. While luxury sellers can wait out a market, the same is true for their buyers. And they do wait. Only when a luxury buyer sees value will a home be sold. Rampant over pricing especially when you get to $2 million and up created a terrible stall in the market. 2019 changed that.
$3 million+ sold 44% quicker (226.3 to 127 days) with a 20% rise in the average sales price ($3,722,000 to $4,516,712). Impressive is an understatement.
How Is Real Estate in Bergen County
So how is real estate in Bergen County going to do this year?
Most home buyers will continue to have a tough time in 2019 because of very low inventory. First time buyers in the $250-500,000 price range will almost always have to deal with multiple bid situations. The $500,000 – $1 million group will see this often. In spite of low inventory, if a home is poorly marketed it will not do well. Over pricing is the most critical mistake a seller can make always and in this market, extremely so. Buyers facing a tough market should get their ducks in order so they present themselves in the strongest possible way to a seller.
2020 will be another great year for residential sales. Nothing dramatic expected; 2020 should be a repeat of 2019. Mortgage rates should stay pretty much the same with maybe a half point up tick by year’s end but that’s still awfully low. This is all stable and stability is very very good.
I have comprehensive information for home buyers and home owners on my website. You can call or text me at 201-741-8490 (or firstname.lastname@example.org if you prefer). Let me know your thoughts – I’d appreciate it.