The Essex County Real Estate Rollercoaster: July 2023 Edition

**The Essex County Real Estate Rollercoaster: July 2023 Edition** Oh, what a time to be alive (and shopping for homes) in Essex County, New Jersey! If you've even so much as glanced at a 'For Sale' sign this summer, you'll know the ride is wilder than ever. Let’s dive into the July stats, shall we? Despite the fact that a cold breeze has momentarily blown over our nation’s home-buying frenzy with a 3.3% month-over-month dip in sales, according to the ever-watchful eyes of the National Association of REALTORS® (NAR), Essex County tells its own story. Blame it on those skyrocketing mortgage rates nearing 7%. Once tempted buyers are now sideline spectators, reassessing whether now’s the moment to jump into the market. And let's not forget the home-hugging effect of those who locked in cozy rates when times were, let’s say, a tad more financially forgiving. Who'd want to give up those golden handcuffs? Now, for the numbers that'll make your jaw drop:- Single Family Homes? Closed Sales down a whopping 28.1% to 1,953.- Townhouses & Condos? A 22.4% slump, leaving us with just 454.- And our seasoned citizens? Their adult community sales fell 17.3% to a mere 62. But here’s the twist - while sales might be taking a summer siesta, prices sure aren’t. - Single Family Median Sales? Jumped 8.9% to a cool $610,000.- Townhouse-Condo Median Sales? Up by 12.9%, ringing in at $395,000.- Adult Communities? Hold onto your hats - a 25.2% surge to $519,500. Nationally, we're dancing near record highs with a median sales price of $410,200, just teasingly below the record-setting $413,800 from June 2022. And with a skimpy 3.1 months' supply in July, the age-old 'supply and demand' tale is alive and well, pushing prices to dizzying heights in those sought-after affordable markets. Essex County, it seems, remains the belle of the real estate ball, even with its capricious moves. Whether you're buying, selling, or just here for the drama, strap in. The show's just getting started!

Dear Inflation - Please keep doing the "Limbo" and get low, get low, get low.. !

Well, well, well, folks, don your party hats and break out the disco balls! Because last week saw interest rates doing a nifty little dance move we like to call "Improvement!" So, dust off your reading glasses and let’s dive into what went down, and peek a little into the crystal ball to see what the future holds. Ladies and Gentlemen, Keep Your Receipts - Prices Are On A Diet! The star of our show last week was the Consumer Price Index (CPI) for June, strutting on stage Wednesday and flashing some delectably lower numbers. Looks like consumer prices have decided to go on a diet, and I tell you, that’s news that has the interest rate-sensitive housing sector popping the champagne! The headline CPI for June, which bundles in food and energy, sauntered in at a lean 3% year-on-year. That's the slowest we've seen since we last saw Harry Styles sporting a buzz cut, back in March 2021. When we compare it to last year's rather chubby CPI readings of over 9%, it's like the nation has been on a financial Biggest Loser. Little Note: This considerable waist-slimming is mainly because oil prices were sashaying around $70 in June...nearly half the size of last June's rather rotund price tag. This just goes to show how crucial it is to keep oil prices hitting the gym. Feeling the love from these svelte numbers, Core CPI, which takes out food and energy from the equation, also lost more than the market had predicted. This fitness frenzy kicked off a wild shindig in the bond market, with the 10-yr Note yield taking a quick tumble from the lofty heights of 4.09% to a rather more relaxed 3.83%. Feds Start to Sing a Different Tune Tickled pink by the delightfully petite inflation figures, some Fed members have already started whispering sweet nothings about inflation nearing "normal levels". In contrast, others are going as far as suggesting that we might be nearing the last call for rate hikes. Now, this is music to our ears, considering just a couple of weeks ago they were practically yelling for more hikes and holding the interest rates hostage. After the confetti was swept and the punchbowl emptied, the markets are only expecting one more "raise the roof" moment at the end of July. But as we know in this rollercoaster ride of rates, the plot can always thicken. Are We Out of The Woods? While Taylor Swift may have left the woods, we haven't quite yet when it comes to inflation. Despite the good news, we might see the CPI playing the yo-yo game in the next few months. The main suspects? Those sneakily low inflation readings of last July and August that might soon be replaced with figures that have had a few too many cupcakes. Looking ahead, the price of oil might become the gate-crasher at our low-inflation party. If it decides to creep higher than its recent low-key stance, we could see inflation turning into a bit of a party pooper, much like it did last summer. With production cuts looming from OPEC and Saudi Arabia next month, oil prices might be gearing up to play party spoiler. The Nifty Number – 4.09% This 4.09% number is like the bouncer at the club door, preventing rates from getting too high and unruly. Since last November, it's been that steadfast figure, but if the 10-yr yield dares to step above it, we might see Treasuries and mortgage rates making a beeline for the sky. The silver lining? The past week saw the 10-yr yield bounce off 4.09% a few times before deciding to come back down to the party. Bottom line: We're witnessing inflation acting like a well-behaved guest, trending lower. As long as it keeps up this polite demeanor, we might just see interest rates deciding to follow suit and take a chill pill.

Cost of living + Taxes = New Migration Patterns

Hoboken?  Hmmm, maybe Houston perhaps...Hey folks, gather around and let me spill some real estate beans that caught my attention recently. I stumbled upon a couple of articles from The New York Times that I believe are game-changers for future property prices. Now, I'll give you the juiciest bits from each article and then dive into why this will have a massive impact on the real estate scene. So buckle up and get ready for some serious insights! First up, we have "The Greatest Wealth Transfer in History is Here, With Familiar (Rich) Winners." Picture this: back in 1989, the total wealth of American families stood at a modest $38 trillion. Fast forward to today, and that number has skyrocketed to a staggering $140 trillion. What's even more mind-blowing is that a whopping $84 trillion of that wealth will be inherited by the year 2045. Can you imagine the kind of moolah we're talking about here? But that's not all, folks. The second article, titled "Coastal Cities Priced Out Low-Wage Workers. Now College Graduates Are Leaving, Too," paints a picture of coastal cities losing their grip on intellectual talent. It turns out that these once-thriving hubs of brainpower are now witnessing a mass exodus of college graduates. And guess who's reaping the benefits? Cities like Dallas, Houston, Austin, Raleigh, and Orlando are becoming hotspots for these eager young minds. It's a migration frenzy, and the coastal cities, particularly NYC, are taking the brunt of it. Talk about a major shift in the real estate landscape...but hey, just keep raising them taxes...(we'll discuss more on this in tomorrow's post). Now, let me connect the dots and share this take on this real estate extravaganza. Living in the NYC metro area, I often find myself scratching my head and wondering how the heck people can afford the homes they're buying. Seriously, I saw a house in Bloomfield recently sell for a mind-boggling $300,000 over the asking price.  As a real estate agent, I've noticed a trend: many buyers these days are getting a hefty chunk of change from their dear old parents to fund their home purchases. Hey, there's nothing wrong with that—someday, I hope to do the same for my own kiddos. But here's the kicker: not everyone is fortunate enough to receive parental assistance for down payments. And guess what they're doing? They're packing their bags and heading south. This data I stumbled upon simply confirms what I've been suspecting all along. Let me hit you with a perfect example: Aceland Mortgage shared some stats that blew my mind. In Ridgewood, the average price per square foot for a home is a jaw-dropping $488. That means if you want a cozy 3,000 square foot pad, you'll be shelling out a staggering $1,464,000. Oh, and don't forget about those property taxes, hovering around a cool $25,000 per year. But hold on to your hats because I've got a secret to share. In a lovely suburban area near Houston you can snag a 20-year-old 3,000 square foot gem for just $450,000. And the cherry on top? The property taxes are a mere $8,000 per year. Here in NJ we're somehow weirdly programmed to think paying $10,000+ a year in property taxes is OK or normal (It's not. Write to your representatives and tell them to wake up). So, what's the deal with all this wealth transfer and inheritance coming our way? Are folks using their retirement funds and inherited riches to buy second homes? Or are they finally fulfilling their dreams of owning their own palatial residences? And for those "have nots," are they simply saying, "Screw it, I don't need to struggle here. I'm outta here, off to the south where life is grand and affordable!" It seems like we've reached a point where society is divided between the haves and the have nots, and boy, are the Sun Belt markets in for a wild ride. Picture Raleigh, Atlanta, Savannah, Charleston, Greenville SC, Orlando, Tampa, Houston, Austin, Dallas, Nashville—all these cities are poised to reap the benefits. They're importing college grads, boasting solid infrastructure, offering diverse employment opportunities, and, let's not forget, have some pretty awesome walkable areas. It's a win-win situation for everyone involved-except the blue Northeastern states they are leaving behind. So there you have it, my friends. The real estate game is about to undergo a massive transformation, thanks to the largest transfer  of wealth in history and the shifting migration patterns of college grads. It's time to strap on your seatbelts and ride this wave of change because the Sun Belt markets are about to shine brighter than ever.

Sell Now to Sell Fast

If you're a seller looking to get top dollar for your home and want a fast closing, now is the perfect time to list your property. Why? Low inventory. According to recent market updates, the demand for homes is far outweighing the supply, which means that there are many buyers out there who are eager to make an offer on your property.In today's real estate news, it's clear that we're in a seller's market right now. This is great news for anyone looking to sell their home quickly and for the highest possible price. The competition for available homes is high, and buyers are willing to pay top dollar to secure their dream home.Now, it's important to remember that in a seller's market, you still need to price your home correctly. Just because there is low inventory and high demand doesn't mean that buyers will be willing to pay an unreasonable price. Working with a knowledgeable and experienced real estate agent is crucial in determining the right price for your home.Another benefit of selling your home now is that you can expect a fast closing. Because buyers are eager to secure a property, they're more likely to be flexible and accommodating during the closing process. Be sure to work with your real estate agent and lender to ensure that everything is in order and that your closing goes smoothly.In summary, if you're looking to sell your home quickly and for top dollar, now is the time to do it. With low inventory and high demand, there's never been a better time to list your property. Just be sure to work with the right team to price your home correctly and navigate the process of closing. Happy selling!