How's The Clinton Township, NJ Real Estate Market?

How's the Clinton Township Market?

For the month of  December, 2010, we had  a total of nine (9) homes placed under contract, which leaves us with a total of eighty (80) homes for sale. or, to put it another way, with almost nine (9) months of inventory.  What does that mean?  Well, with 80 homes currently on the market; and, homes selling (in December) at a pace of  9 per month ( 80 divided by 9 = 8.89), it would take (almost) 9 months to clear our current inventory.  In other words we have a "buyer's market".  Specifically a "buyer's market" is when we have 5 months (or more) of inventory.  Alternatively, when we have 4 months or less of inventory, we have a "seller's market".  A seller's market occurs when our inventory (number of  homes for sale) is not keeping up with the number of  contracts per month.  Remember those days?

 

The Good News  1.  We have increased the number of contracts (accepted offers) in 2010. 2.  We have decreased our inventory (total number of homes for sale).

Let's take a closer look at our inventory in Clinton Township.  You can see from the chart below, that in December, a total of  10 homes were newly listed for sale in Clinton Township, while we contracted 9 homes.  That means that we are still adding more homes to our inventory  per month, than we are selling (contracted homes).  The good news in December is we are doing so at a slower pace than in any other month in 2010.  And,  we are in a better position than December, 2009, when we had seven (7) homes under contract, and a total of ninety (90) homes for sale.  So we are seeing signs of improvement, albeit slowly.  Currently we have a total of  nine (9) sellers for every one (1) buyer in Clinton Township.   

As the weather warms, we will see if these unsold homes come back on the market to try again, or remain off the market because "their price" is not yet what buyers are willing to pay.  We know that if these homes remain off the market and our  inventory declines, our market will improve.

 

The chart above also tells  us that throughout 2010, the number of newly listed homes per month was greater than the number of contracted homes per month.  This may indicate that our current declining inventory (total number of homes for sale) is not because the homes were sold, but because the sellers have either given up or waiting until spring to relist their home. 

The four Challenges in our Clinton Township Real Estate Market .

• Today's buyers are downsizing, and first-time homebuyers have lower budgets.  Many Move-up buyers are unable to do so because they are upside-down on their mortgage.  They would like to purchase a larger home, but cannot until the value of their current home increases.  At the sales pace of today's market, this may take another ten (10) years.

 

• To put some perspective on our job market, in 2010 New Jersey has lost an average of 3,900 jobs per month.  In Hunterdon County  the news is better, but still higher than in past years.  Until we begin to attract high paying jobs in both the county and state, our higher priced homes will continue to lag in sales.  This has also contributed to the McMansions slump in sales.   In Hunterdon County, we are hopeful that this market might improve somewhat in the months and years ahead with the news that Merck will be consolidating  its New Jersey offices to its Whitehouse Station headquarters. Although Merck will not be paying for relocation costs due to the proximity of the relocation, and because most of these employees will be commuting in the opposite direction of heavy traffic patterns, we cannot assume that this impact will be substantially changing the Clinton Township Real Estate Market in the near future

 

•  With an emphasis on reducing our national debt, it appears unlikely that a 2011 tax credit for home purchases will be reinstated.  However, if you notice the jump in the number of contracts in homes for sale in Clinton Township, NJ in April, 2010 (when the last tax credit expired) it showed a noticeable spike to the year's high of 64 homes under contract. 

 

• Although Hunterdon County New Jersey foreclosure rates are relatively low, we are seeing a shadow inventory building, which may impact home sale prices in 2011 and beyond. 

Also:  We've all heard that  labor productivity has increased in the past several years.  Because we are working longer, our time has become a very valuable commodity.  Today's homebuyers are now seeking locations offering shorter commute, access to public transportation, and walk-able communities .  Commutability to higher paying jobs is still a challenge, so if we need to sell our Clinton Township home, we have the challenge of finding a buyer from a small pool of buyers.

The average list prices of  Home Contracts in Clinton Township in 2010 was $418,428, as compared with the 2009 average price of  $429,576 is a decrease of 3%.  Additionally, in 2009, a total of 21 Clinton Township homes sold above $600,000; and, in 2010 a total of 17 had a sale price above $600,000.  Which  may be a confirmation that McMansions are falling out of favor with buyers.  Additionally, the current data shows that now two (2) out of three (3) households in New Jersey have no children and do not want to pay for property taxes to support school systems they do not use, which may be why townhomes and condos are selling at a high pace.

What can you expect if you need to sell your Clinton Township Home in 2011? 

 

First, don't put it off.  Indications are interest rates are on the rise.  Higher interest rates will reduce the number of buyers in the marketplace.  Secondly, we anticipate a decline in home prices in 2011.  The longer your home is on the market the more likely the price will decline.  Third, you'll need patience. With 80 homes for sale in Clinton Township in December, 2010 and expected to increase as we approach the spring market, and a total of  nine (9) contracts in December, 2010, we currently have one (1) buyer for every nine (9)  sellers.  The average days on the market is currently one hundred and three (103) days.  This does not reflect any prior times (and days) the home may have been listed without selling. 

What do you do if you need to sell?  Assess your situation carefully and honestly.  If you need to sell your home, don't put it off!    In this market,  you'll also need a Realtor® who will be as serious as you are about selling your home.  The Realtor® you choose should evaluate your home in detail and present a convincing Market Analysis that shows exactly where your home should be priced.  If you are not convinced get a second, or third opinion, but keep in mind, the definition of "the market" is what a buyer is willing to pay, and not what you may hope to get from the sale.  Sometimes that's a tough pill to swallow, but your Realtor® should provide you with convincing evidence that her figures are correct.  My customized Market Analysis is over 50 pages of concise and customized information with detailed assessments of your individual home.  An educated seller will make better decision and get better results.   It's also very important to keep in mind the reason you hire a Realtor® (i.e. what you are paying a Realtor® to do for you).  Do not make the mistake of choosing a Realtor® because they've given you a higher market value of your home than other Realtors®.  That's an old trick that inexperienced Realtors® use to get your business.  Then, once your home is on the market, they'll tell you why you need to continually reduce the price.  You are paying a Realtor® to market your home in order to bring the most buyers through the door.  Once the buyers have viewed your home, their feedback will tell you what you need to know.  So when choosing a Realtor®, review their marketing plans to see how they plan to get qualified buyers into your home. In short, that's exactly what you're paying a Realtor® to do for you.  When you're ready to take that first step, let's talk.  Call me at (908) 537-6596.  I look forward to hearing from you.