January 17, 2023
By Susan Heckman
Happy New Year! With the holidays behind us, many of us take this time to look back at the past year, remembering milestones and accomplishments, and all the peaks and valleys in between.
In real estate, we do the same. This past year has certainly seen its share of ups and downs. After a 2-year period of aggressive home pricing and intense bidding wars, sale prices, while still strong, began to stabilize as the market moved towards a more balanced state. Here at The Gallery Residential Brokerage, we see this as a good thing and part of the normal real estate market cycle.
In New Jersey’s Monmouth and Ocean counties, the buyer frenzy of 2020-2021 has waned in 2022, but even as the number of available properties began increasing, the overall shortage of listings persisted. In addition, buyers looking for a home have had to adjust their price range due to escalating mortgage rates. Sellers have had to adjust their expectations as well, resulting in price corrections and longer days on market in general.
Still, home values at the Jersey shore have increased significantly this past year. In many municipalities, home appreciation reached 15% or higher, demonstrating that real estate remains a strong and attractive long-term investment. And while many market projections say gains will be softer in 2023, over the long-term, real estate will still be one of the best ways to grow your equity.
Here’s a look at how some of the area’s municipalities fared in 2022, compared to 2021:
At the county level, Monmouth saw an average 8.7% increase in sale prices, and Ocean sale prices increased 10.6%. And just how low is inventory? The number of homes sold from 2021 through 2022 fell 18.1% in Monmouth County, and 15.2% in Ocean County. These data points indicate that demand for housing is still higher than the supply and this area is still in a sellers market.
So what does the future hold for buyers and sellers? Some experts predict that interest rates, currently just over 6% for 30-year fixed mortgages (in New Jersey, as of January 15, 2023), may not see notable reductions until inflation is finally reined in. One thing we do know is that historically, mortgage rates have been cyclical, so even if your current finance rate is higher than you planned for, there will be opportunities to refinance in the future.
John Meechan, Broker-of-Record and owner of The Gallery Residential Brokerage, puts it like this. “Buyers may need to accept that mortgage rates, as well as home prices, may not fall enough to be worth waiting to make a purchase. And sellers, this could be your best chance to take advantage of this sellers market while it lasts.”
If you have been considering a move, but are unsure if it is the right decision for you, call us. We are eager to provide you with the answers and guidance you need. We look forward to assisting you!
Call 732-449-4646 or visit us at TheGalleryNJ.com to learn more.
Source: FlexMLS, Mortgage News Daily.