Median sales prices for homes in the state rose 14% in 2020 to $350,000 even after a slowdown during the worst of the COVID-19 pandemic, according to data collected by the trade group New Jersey Realtors.
The group said pending sales and closed sales also rose by at least 5%. Other measures, including days on the market, number of homes for sale and new listings registered declined for the year. New listings fell 8.6% while closed sales gained 5.5%, figures NJ Realtors said indicated strong demand across the state.
Jeffrey Jones, who is serving as the organization’s president this year, said “2020 was a market unlike anything we’ve seen before.” He added that the group “saw our membership go from periods of extreme scarcity to booming business within a matter of weeks.” Jones is the owner of Amerisource Realty Network LLC, a Parsippany-based commercial real estate brokerage.
Closed sales increased by nearly 38% in December and pending sales gained 44.3% compared to 2019. The number of homes for sale was down 40.8% for the month. Hunterdon County showed the greatest gain in percentage of closed sales with a 29.1% increase.
Statistics from the Federal Home Loan Mortgage Corp., or Freddie Mac, suggest that demand and prices will continue to rise through 2021. Low mortgage interest rates, 2.77% for a 30-year, fixed-rate loan as of Jan. 21, should continue to buoy the market, according to NJ Realtors.
Real estate professionals have offered anecdotal evidence of the state’s market’s resilience in the face of the COVID-19 outbreak and the accompanying economic downturn. For example, in an October interview with NJBIZ, Hartz Mountain Industries President and COO Gus Milano characterized the effect of the pandemic as a “short-term disruption” and that his firm was “very comfortable” investing in the state.
In addition, some industry executives have also indicated that the New Jersey market may be benefitting from families seeking more space during the pandemic and leaving New York City. In August, Michael Pembroke, the COO of Russo Development, told NJBIZ that his firm — a leading multi-family residential developer — had seen an influx of potential buyers from across the Hudson. “The number of tours from New York City, pre-May 1 … was roughly 4% of our tours,” Pembroke said. “From May 1 to [August] that number has been 16%.”