LIFESTYLE CHANGES CONTINUE TO DRIVE DEMAND, TIGHT HOUSING MARKET IN NEW JERSEY

The 2021 spring housing market in New Jersey is expected to be hot for sellers, but daunting for buyers as inventory remains tight through the early half of the year. According to Zillow data, homes in the United States were on the market an average of 20 days in 2020, down from 28 in 2019.

New Jersey was in line with this national trend. Typically, the Garden State’s median days-on-market begins to increase in May, as the early home shopping season comes to a close, and again in October, as the weather gets colder. But that pattern was flipped on its head last year. According to Nicole Bachaud, Economic Data Analyst at Zillow, days-to-pending began to climb in March following the first round of statewide stay-a-home orders. In May, median days-to-pending plummeted to new lows. The lowest point hit a median of 17 days-to-pending in August, which was held through October.

“The median days-to-pending in the U.S. overall shrunk to 12-13 days during that same period,” reports Bachaud. “But despite the fact that New Jersey never dipped below that two-week mark for median days-to-pending, the change from 2019 was drastic. New Jersey ended 2020 with the typical home going pending over a month (32 days) faster than the same week in 2019. The U.S. only dropped 26 days in that period.”
 

“But despite the fact that New Jersey never dipped below that two-week mark for median days-to-pending, the change from 2019 was drastic," reports Nicole Bachaud, Economic Data Analyst at Zillow.

Realtors in Northern New Jersey are experiencing more of the same so far this year, and their season, which typically kicks off the weekend after the SuperBowl, hasn’t officially started. “I went to an Open House in Livingston this past weekend, and there was a line outside,” shares Gordon Crawford, who leads the Crawford Home Selling Team with Keller Williams Realty Metropolitan. “I’ve never seen anything like it in the 50 years I’m working.”

While supply is there, demand is even greater. “In Summit, in 2019, 249 homes were sold. In 2020, it was 358. So there was higher inventory than in years past, but there were more buyers in the market and the homes would disappear, so it made people think inventory was tight,” explains Zander Oldendorp, Listing and Buyer Specialist with The Oldendorp Group of Compass NJ.

“I’ve never seen anything like it in the 50 years I’m working!” exclaims Gordon Crawford, New Jersey Realtor.

Real estate experts in New Jersey are in agreement this demand was driven by lifestyle changes as a result of or accelerated by the COVID-19 pandemic.
 

Buyers are looking for more space – both inside and out. “Before the pandemic, my clients didn’t care so much for a big yard. They just wanted move-in ready,” says Amanda Damesek, a Sales Associate with Prominent Properties Sotheby’s International Realty in Short Hills. “But there’s been a total shift since COVID. There’s a resurgence for larger properties and swimming pools.”

Remote work, distance learning, and business closures are driving the demand for more square footage. “People are less reliant on amenities like restaurants and nail salons. They’ve taken all these service providers, even shopping for food, and brought them inside their homes,” says Oldendorp. “You are working from home. Your child gets educated at home. You need more space.”

Many New Yorkers are now calling New Jersey home, as they started to relocate to the suburbs of neighboring states last spring. While the 2020 Census numbers reporting migratory patterns between New York and New Jersey won’t be released until March, Realtors anticipate a swing in the Garden State’s direction, as former renters in New York’s five boroughs make up a large percentage of their clients. “I’ve sold so many houses recently to New Yorkers who were living with friends,” shares Damesek. “They abandoned their NYC apartments to live with family during the pandemic. They just decided to buy and wanted to be closer to family.”

This motivated pool of buyers is moving from NYC to New Jersey for space, lower taxes, and location. “We have it all in New Jersey! We’re one hour to NYC, one hour to the Shore, one hour to the mountains, and close to major airports,” says Crawford. “They’re realizing they can telecommute and live in Northern New Jersey or even Western New Jersey and have a newer and bigger home.”
 

"I’ve sold so many houses recently to New Yorkers who were living with friends. They abandoned their NYC apartments to live with family during the pandemic. They just decided to buy and wanted to be closer to family," shares Amanda Damesek, New Jersey Realtor.

Moving is stressful, but this tight market ups the ante. “It’s one of the most stressful things,” says Crawford. “But it’s very rewarding for the Realtor if they’re able to make things comfortable for their clients and the process as seamless as possible.” Crawford, who is predominately focused on Morris, Essex, Union, and Somerset counties, partners with AVE to provide temporary housing for his clients who are in between homes.

Crawford recently referred three clients to AVE Florham Park to give them time to figure out what’s next. “Each client was different – a local corporate executive couple debating retirement, a middle-aged couple relocating from Florida, and an active, older couple who recently downsized,” he shares. “But what they did have in common was they all had dogs.” Crawford said AVE being pet-friendly was key, as well as its convenient location and on-site business amenities.

Damesek, who focuses on Essex, Morris, and Union counties, also referred two clients to AVE recently. Both stayed in fully furnished apartments as they just downsized and purchased in a condo development – construction was delayed due to COVID-19. “AVE was the perfect solution,” she says.

Realtors appreciate the flexible lease terms and fully furnished accommodations. “It’s a great option for clients in this market because it gives them time to hang their hat, be relaxed, and not rushed,” says Oldendrop, who has also referred many clients from Morris and Union counties to AVE over the years for situations like large home renovations and needing equity from a sale before a purchase.