Bergen County real estate has stabilized. This was my projection last year and I am very happy to say that I was right on target. What I’d said and written was that by the end of 2009 the market would stabilize. It has done exactly that.
Our housing market is improving. New Jersey MLS data, bank appraisers and housing reports all say the same thing: We have clearly bottomed out and are in a period of stabilization. Because so many different points of view agree, this must be the case.
Today’s ratio of homes for sale to under contract is 4 to 1; early in the year it was in double digits. This is quite a recovery. Appraisers and market analysts teach us that when the ratio is less than 5 to 1, we are in positive territory. Because of this ratio it is clear that we have turned the corner and the market is moving forward.
Last spring Bergen County was classified by the mortgage industry as an “area in decline” meaning that values were falling. Appraisers were deducting 1% per month of value; if a home appraised at $200,000 and was closing 2 months later, the appraisal was fixed at $196,000. Bergen County’s housing market is no longer classified as “in decline” and a Valley National Bank appraiser on Monday told me that price depreciation has ended.
Jeff Otteau in his latest real estate newsletter termed the NJ real estate market’s performance “remarkable” and forecast continued improvement. The monthly Credit Suisse agent survey said that for the first time in a long time a majority of agents reported positive home buyer traffic and houses selling quicker.
With all time low interest rates, prices no longer dropping and falling inventory levels, there should be no surprise to find that Bergen County real estate has stabilized. We are moving toward a positive market after quite a rough ride.