Seven Things You Need to Know About Real Estate in New Jersey

New Jersey residents might be surprised to learn that there are many positive aspects about the state's real estate market. Currently, the New Jersey real estate market offers many opportunities, evidenced by increasing affordability rates and a high inventory of homes for sale.

The New Jersey Association of REALTORS^®' (NJAR^®) Get the REAL Story^SM on real estate in New Jersey public education campaign is designed to assist potential buyers and sellers in learning about New Jersey's real estate market. Below are seven key facts about New Jersey real estate buyers and sellers should consider when thinking about a real estate transaction.

1. New Jersey homes have generally maintained their values. National news about tumbling residential real estate prices does not present an accurate picture of New Jersey's local markets. While the national seven year home appreciation rate is 37.8 percent, New Jersey's is more than double that amount at 80.4 percent. Some areas of the state, Bergen, Essex, Mercer, Cape May and Salem counties, saw median price increases in the first quarter of 2008.
   
   

2. The market favors first-time home buyers, who make up 40 percent of the New Jersey market. Buyers currently have many more homes to choose from and are benefitting from mortgage interest rates that are near historic lows. Without having to sell previously-owned property, first-time buyers can also take advantage of the increasing rate of affordability. According to the First Quarter 2008 New Jersey Home Sales Report, New Jersey's housing affordability composite index rose over 100, signifying that a family earning the state median family income of $84,500 has the potential to qualify for a mortgage loan on a median-priced home, assuming a 20 percent down payment.*
   *Does not include the cost of insurance or taxes. Borrowers are advised to consult a mortgage professional to determine mortgage eligibility.
   
   

3. It's also a good time to trade up. Homeowners in need of a larger home might be hesitant about listing their current home in a buyer's market. However, while sellers may have to accept a more realistic price for their current home, the seller of the home they wish to purchase is in the same situation. Realistic pricing is key and REALTORS^® familiar with a local market can be invaluable in pricing and marketing your home.
   
   

4. Owning a home builds long-term wealth. Over the last decade, the median prices of homes in almost every metropolitan statistical area that covers the state have more than doubled; illustrating that homeownership is a sound financial investment that historically outperforms the stock market in building long-term wealth. New Jersey home buyers who purchased their homes seven years ago have accumulated an average of $156,300 in home equity.
   
   

5. A home is much more than a nest egg. Despite the tax benefits and financial security which homeownership can provide, a recent survey of New Jersey homeowners revealed that the desire to establish a household and have a place to call their own was the number one reason for buying a home.
   
   

6. New Jersey has a lot going for it. There are many positive economic and market forces in the Garden State that support the long-term health of residential real estate. Reflecting a strong employment market, New Jersey's median income of $64,470 is the second highest in the country. Also, excellent school systems, proximity to New York and Philadelphia, a thriving tourism industry and an extensive transportation infrastructure all enhance the vitality of this area.
   
   

7. There are 53,000 REALTORS^® in New Jersey that can provide you with localized information. Nine out of ten home buyers in New Jersey choose to work with a REALTOR^® and 86 percent said they would probably work with the REALTOR^® again. REALTORS^® have a thorough understanding of the dynamics of their local markets and are ready to guide potential homeowners through the process.
   
   

Contact your local REALTOR® with any questions you may have about your local market.

Brought to you by the New Jersey Association of REALTORS®.  Copyright 2008.

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