A recent trend in the real estate market might be pointing to some entry points for buyers to gain a foothold that has not been available, Homebuilder inventory across the country has risen to levels we haven’t seen since 2009. While that might sound concerning at first, it actually represents a significant opportunity for those patient buyers who have been on the sidelines just waiting for a chance to enter.
The Numbers
In August, the number of unsold completed new single-family homes reached its highest point since July 2009—a full 16 years. This represents a significant shift from the hot pandemic housing frenzy when builders could barely keep up with demand.
Much of the accumulating inventory is located in the Sun Belt markets like Florida, Texas, and the Mountain West possibly creating opportunities even in our New Jersey market.
What’s Driving the Change?
The cooling market means that homes are now sitting on the market longer, giving builders the need to move inventory through certain incentives.
Buyers can benefit from this national trend in several ways:
■ Nationally, builders are more willing to negotiate on price, upgrades, and incentives.
■ Homebuilders are offering substantial incentives including rate buydowns, closing cost assistance and premium upgrades.
■ Buyers will not feel pressured to waive contingencies or make offers sight unseen.
■ Builders with inventory have completed homes ready for immediate occupancy.
While national inventory is up significantly, New Jersey’s market dynamics differ from high-growth Sun Belt states.
Industry analysts are watching to see if inventory continues to rise and whether builders will need to compress their profit margins further.
The bottom line for New Jersey homebuyers: there’s currently more leverage in the new construction market than we’ve seen in years.
The market has clearly shifted in favor of buyers—and now making informed decisions and being ready to move may give sidelined buyers the best chance they have seen in years.
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.
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