Here's a bizarre statistic for the first half of July: median sold prices in Bergen County have risen 16.2% over the same period last year. In northwest Bergen, they're up 6.4%. Wait a minute, how can that be? The economy is still slow, unemployment still high and inventory levels continue to favor buyers.
It all ties back to the expiration of the tax credit. Buyers who qualified for the tax credit had to be under contract by April 30. Everyone who was going to buy did so before April 30, resulting in a huge decline in the number of May contracts written. However the higher end of the market wasn't terribly affected by the tax credit because those buyers didn't qualify. As a result, higher priced homes were selling and lower priced homes were not, skewing the median sold price for July closings.
Pay attention to national news reports in August and September when the media reports that median home prices have risen sharply. You'll know why they did.
- Michael Shetler
source: NJMLS. Info deemed reliable but not guaranteed.
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