Market Update
By Anthony DiMaio
The first quarter of 2025 has brought notable shifts to New Jersey’s housing market, echoing national trends yet revealing some unique local dynamics. Drawing on recent data and insights from the National Association of Independent Builders (NAIB) and other sources, here’s what New Jersey buyers, sellers, and real estate professionals need to know.
Slower Growth, But Still Rising Prices
Nationally, home price appreciation slowed in early 2025, with the Federal Housing Finance Agency (FHFA) all-transactions House Price Index (HPI) showing a 4.7% year-over-year increase—down from 5.5% the previous quarter. This cooling is attributed to persistent high mortgage rates and a surge in housing inventory, which have eased the upward pressure on prices seen in previous years.
In New Jersey, however, the market remains robust. The Garden State posted one of the highest annual home price gains in the country, with appreciation rates ranging from 7.8% to over 8%—second only to Connecticut and Rhode Island
. In some metro areas, such as Newark, the median sale price jumped 12.2% year-over-year, the highest among the nation’s top 50 metros
. This underscores New Jersey’s continued appeal, especially in commuter-friendly and high-demand locations.
Inventory and Market Activity: Signs of Balance Emerging
While the national inventory reached a five-year high in April 2025, New Jersey’s inventory growth has been more measured. Active home listings in March 2025 totaled 13,143, up 14.6% from the previous year, with new listings rising in nearly every county
. Despite this uptick, inventory remains tight by historical standards, keeping competition fierce in many areas.
Homes are moving quickly: the average time on market dropped to about 33 days, down 8% from last year
. In Newark, the seller’s market is especially strong—there are 47% fewer sellers than buyers, making it the nation’s most competitive metro for sellers
Regional and Segment Trends
Suburban and Shore Markets: Towns like Montclair, Princeton, Ridgewood, and coastal communities such as Asbury Park and Ocean City remain highly competitive, driven by hybrid work trends and lifestyle preferences
. Affordable Markets: Cities like Newark, Trenton, and Camden are attracting more buyers due to relatively lower price points and ongoing revitalization efforts
. Luxury and Multifamily: Northern New Jersey’s rental market is among the hottest in the Northeast, with high demand and a 70% lease renewal rate. However, luxury apartment vacancies are rising as new developments come online
What’s Driving Demand?
Demographics: Millennials and Gen Z are entering their prime homebuying years, while retirees seek low-maintenance living in adult communities
. Job Market: Strong employment in healthcare, technology, and logistics is fueling housing demand, particularly in suburban and commuter-friendly areas
. Limited Land and Construction: New construction is hampered by high costs and limited land, especially in North Jersey, keeping supply tight and supporting price growth .
Looking Ahead: 2025 and Beyond
Forecasts suggest that New Jersey home prices will continue to rise, but at a slower pace than the explosive gains of the pandemic era. Most projections call for a 2–4% increase in 2025, with some markets—like Atlantic City and Vineland—expected to see gains closer to 6–7% by year-end
. The risk of a market crash remains low, as demand continues to outstrip supply in most areas
Key Takeaways for Counsellors Title Clients:
Sellers: It remains a strong market, especially in high-demand metros and suburbs. Proper pricing and preparation are still crucial for a quick sale.
Buyers: While competition is easing slightly and inventory is improving, acting quickly and being flexible (especially on homes needing updates) can help secure a property.
Investors: Rental demand is strong, particularly in North Jersey and near transit hubs, making multifamily and suburban rentals attractive options
Conclusion
New Jersey’s housing market in early 2025 is marked by strong price appreciation, gradually increasing inventory, and persistent buyer demand—especially in commuter-friendly and affordable areas. While the pace of growth is moderating, the state remains one of the nation’s top performers for home price gains, offering both opportunities and challenges for buyers, sellers, and investors alike