Are you thinking about buying a home in New Jersey this summer? If so, you’ll have plenty of company.
Real estate markets across the state are still highly competitive, as we enter the last month of spring 2018. In many markets, this competition is being driven by tight supply along with steady demand from buyers.
Here are three things you should know about buying a home in New Jersey, in summer 2018:
1. Rising mortgage rates could create urgency among buyers.
Average mortgage rates have risen steadily (more or less) since the start of 2018. There have been a few week-to-week declines during that time. But overall, it has been a mostly upward trend. This is based on the weekly mortgage industry survey compiled by Freddie Mac.
On May 24, the government-sponsored corporation reported that the average rate for a 30-year fixed mortgage loan rose to 4.66%. What’s notable about this is that rates haven’t been that high in a long time. In fact, you’d have to go back to May of 2011 to find average rates at that level.
For those planning to buy a home in New Jersey during summer 2018, this is an important trend to watch. It could add a sense of urgency to the house-hunting process, at least for those buyers who need to use mortgage loans to finance their purchases.
The bottom line is that home buyers might want to consider buying sooner rather than later, due to the potential for rising housing costs and interest rates.
Get a rate quote: The figures reported above are averages based on a nationwide survey. Individual mortgage rates can vary based on a number of factors. Please contact us if you’d like to receive a rate quote tailored to your situation.
2. Home prices have slowed but are still rising in most NJ housing markets.
Home prices across New Jersey have risen steadily over the last year, and there’s a strong likelihood they will continue to climb through 2018 and into 2019. This is based on several economic and housing forecasts issued recently.
The housing research team at Zillow, for example, recently predicted that the median home value for New Jersey would rise by 7.6% over the next 12 months (through May 2019). This would follow a gain of 9.2% over the last 12 months, based on the company’s data.
This is another trend worth watching, for those who will be buying a home in New Jersey this summer.
3. Inventory is still tight in many markets across the state.
Real estate market conditions can vary quite a bit from one housing market to the next. But for the most part, cities and towns across the state of New Jersey are experiencing tight inventory conditions right now. These conditions will probably continue through the summer of 2018, and possibly beyond.
Statewide, housing inventory in New Jersey dropped by around 11% from March 2017 to March 2018. So in many markets, there just aren’t enough homes for sale to satisfy the demand from buyers.
Inventory is particularly tight at the lower end of the pricing spectrum, where many first-time buyers tend to do their shopping. In this segment of the market, home buyers can probably expect to see bidding wars for the hottest properties.
Of course, this doesn’t mean buyers will come up empty when house hunting. There are homes to be found in the market. It just means they’ll have to dig a little deeper, and be a bit more flexible, when searching for a house to purchase.
So there you have them, three of the biggest trends that could affect New Jersey home buyers in summer 2018.