Growth Suppressed in Northern New Jersey Real Estate Market

Bergen County, NJ---Better Homes and Gardens Rand Realty released their Quarter Two Real Estate Market Reports with features for the New Jersey Real Estate Market.

Sales growth in the Northern New Jersey housing market was suppressed by both a continued lack of inventory and the impact of the 2018 Tax Reform SALT Cap, but a modest but meaningful price appreciation was seen in many county-wide markets in the second quarter of 2019. The market is still poised for both sales and price growth in what will be a strong summer and fall market.

Regional sales were down slightly, but the results varied by county. Regional single‑family sales fell about 3% for the quarter, finishing a rolling year in which they were down a little over 2%. That cumulative number masked a real divergence in the county results with sales down in Bergen, Hudson, Passaic, Morris, and Sussex, but up for Bergen condos and Essex. Similarly, prices were up marginally regionally, but results varied sharply depending on the county. For the region, the average price was up 1.2% for the quarter, finishing a rolling year where they rose by 2.1%. These cumulative regional results do not really tell the story, since pricing compared to last year’s second quarter varied dramatically by county: prices were up in Hudson, Passaic, and Essex, but down in Bergen, Morris, and Sussex.

The rolling year pricing was a little more positive, with most markets showing longer‑term appreciation. This market is poised for significant growth. The sluggishness in sales is not due to a lack of inherent demand, but is being caused by two factors: first, a lack of inventory, which is ticking up but remains at relatively historic lows; and second, the 2018 Tax Reform cap on state and local taxes (“SALT Cap”), which is impacting buyers who usually itemize their taxes and are skittish of extending themselves.

Better Homes and Gardens Rand Realty believes that both issues will ease up as homeowners tempted by rising pricing put their homes up for sale, and the SALT Cap gets priced into the market. Going forward, Better Homes and Gardens Rand Realty believes that both sales and prices will go up by the end of the year. They expect the impact of the SALT Cap to get priced into the market, because otherwise the seller market fundamentals are very strong: the economy is growing, interest rates are near historic lows, inventory is relatively low, and homes are still priced well below their highs. Accordingly, they expect a relatively robust spring market throughout the region.

About Better Homes and Gardens Rand Realty

Better Homes and Gardens Rand Realty, founded in 1984, is the No. 1 real estate brokerage firm in the Greater Hudson Valley, with 28 offices serving Westchester, Rockland, Orange, Putnam, and Dutchess Counties in New York, as well as Bergen, Passaic, and Morris Counties in New Jersey. Founded 35 years ago by Marsha Rand, Better Homes and Gardens Rand Realty today includes more than 1,000 residential real estate sales associates, as well as a commercial real estate company, Rand Commercial; and also the Hudson United Group, which provides residential mortgage lending, title services, and commercial and residential insurance.