Home Sellers Are Pulling Their Homes Off the Market
According to a recent Redfin report, a record number of home sellers have taken their homes off the market. Over the last three months, the Redfin report indicates that 2% of all homes listed for sale were removed from the market. This compares with 1.6% of listed homes being removed from the market by sellers back in 2021.
But in some cases, Redfin is comparing apples with oranges. Rates have literally doubled over the last 12 months, and home prices continue to appreciate; buyers are not able to cover their down payment and their mortgage payment at these levels. So it is safe to assume that these sellers are willing to risk relisting their homes in what is considered a stronger market, like spring and summer.
Average sale price and the median price for a home have increased year-over-year, 12% and 6%, respectively, in the State of New Jersey.
Still, inventories continued to take a beating when it comes to new listings. In New Jersey, new listings have fallen from 20,500 to 17,250 over the course of the last 12 months. So when Redfin talks about a record number of homes being taken off the market, that percentage does not actually represent the comparative number of homes. In 2021 roughly 411 homes were taken off the market, but in 2022 the 2% of homes on the market translated into 345 homes, indicating that more were taken off the market in 2021 when the market was red hot than those taken off the market in 2022, when interest rates and inflation have ripped apart the economy.
Home prices have been slashed aggressively in order to come into the range of home buyers’ wallets.
Obviously, the current economic climate is creating a new file of foreclosures in a number of states, one of which is New Jersey. Recently ATTOM reported that New Jersey had the fourth highest rate of properties entering foreclosure in August: one out of 2,441 units. The other states that were reporting high numbers of foreclosures were Illinois, Delaware and South Carolina.
According to Money Magazine more than one in five listed homes reported a price drop in the month of October. Some of the locations that benefited significantly from the pandemic rush to buy include Boise Idaho, Denver, Colorado and Phoenix, Arizona, which saw price cuts of 68%, 58% and 54%, respectively. And in New Jersey in the month of October of this year, according to Redfin, 45.5% of homes sold below the list price, which represents a drop of 5.6% this year.
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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