A few months ago, we began to see those West Coast hot spots such as San Diego and Seattle starting to flatten out in terms of prices. What we are now discovering is that the recent time of the bidding war may be coming to a close, at least temporarily. According to Zillow, locations such as San Diego have seen 20% of all listings showing a price cut for June. This marks a shift in the trend in what home sellers have seen over the last 20 months or so.
The same report from Zillow indicates that home prices in nearly 50% of the 35 largest US Metropolitan markets are slowing down.
Most likely the relentless appreciation in home prices got a little ahead of individuals’ and buyers’ ability to afford them.
As we wrote back on August 16th, 2018 first-time home buyers are getting involved, but they’re exercising more discipline when it comes to making an offer on a home. It seemed for a while there that buyers assumed that the listed price on a home was fixed, and that it represented the minimum that the house would probably cost. This is no longer the case; Millennials are making more money, the economy is getting stronger, and mortgage rates are getting higher, so this is giving buyers a pause when it comes to putting in an offer on a home.
The good news about this is that it reflects a correction in the housing market trends pointing to a very strong, stable and sober market. Supply and demand are negotiating a healthy balance. According to the article published by CNBC, home builders have still not been able to meet the demands of purchasers, which is also complicated by the shortage of skilled labor and the increased costs in building supplies.
New Jersey has never been a market where buyer exuberance was ever going to overtake common sense. Within New Jersey, most average home prices have increased year-over-year in the single digits with the exception of those with direct access to New York City via public transportation.
If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.
Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.