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The Lloyd Law Monthly Report on North Jersey Real Estate - May 2020

Posted by James Lloyd | Jun 28, 2020 | 0 Comments

Each month, the New Jersey Association of Realtors publishes key housing indicators (metrics) of the real estate market for every county in the State.  This data compiles a great number of useful data points including new listings, closings, and median sale price with a comparison to prior year data.  The Lloyd Law Office regularly reviews these reports to stay up to date on trends in the market so that we can better advise our clients and referring Realtors.  We primarily look at the five counties of Union, Essex, Bergen, Passaic and Morris that we regularly work with buyers and sellers of real estate.  This information is available to the public on the website of the New Jersey Association of Realtors at  http://njar-public.stats.10kresearch.com/reports

Single Family Homes –May 2020

Key Metrics

New Listings

% 2019 Month change

New Listings YTD

Closed Sales

% 2019 Month Change

Closed Sales YTD

Median Sale Price

%  2019 Month Change

Median Sale Price YTD

Bergen

956

-35.5%

4,096

471

-29.9%

2,297

$535,000

+4.9%

$514,500

Union

565

-34.1%

2,507

273

-34.1%

1,508

$400,000

+7.2%

$391,000

Essex

622

-29.9%

2,669

298

-41.9%

1,561

$472,500

+1.0%

$437,000

Passaic

287

-43.7%

1,423

194

-34.2%

926

$370,000

+7.2%

$355,750

Morris

693

-35.6%

2,972

318

-32.8%

1,610

$470,000

+3.3%

$442,250

Hudson

94

-41.6%

427

43

-52.2%

43

$450,000

+19.8%

$400,000

Sussex

343

-21.7%

1,458

199

+1.5%

850

$246,700

+8.6%

$255,000

Total

3,560

 

15,552

1,796

 

8,795

     

Our review of May's housing market data indicates that there are signs of recovery from the devastating impact of the COVID-19 virus and government restrictions.  While there was still a marked decline in new listing inventory of 20 – 40% from May of 2019, the total drop in new listings is less than half of what we saw in April 2020 which seems to suggest that Sellers were beginning to return to the marketplace.  The total number of closings in May shows increased declines over May 2019.  Some of North Jersey's most active counties showed a decline in closings over 30%.  This can be attributed to the precipitous drop in listings early in the pandemic in March and April.  While the total economic impact of the housing slow down from COVID-19 is still yet to be determined, we do know that a 30+% percent decrease in closings stings the many segments of the real estate industry, especially the services involved in each transaction including real estate agents, attorneys, home inspectors, title insurers, movers, mortgage brokers and surveyors.  A dramatic decrease in closings has led some in the industry to jump into other jobs and reconsider career options in order to survive.

Meanwhile, the median sales prices continue to climb in each county an average of 8-10%.  Some of this increase is likely the mix in inventory and the demand for high-end properties being driven by those fleeing New York City and other urban areas.  Three interesting trends to keep an eye on during North Jersey's re-opening and recovery from the coronavirus are: 1.) Sussex County – while all other North Jersey counties saw double-digit declines in the number of closings in May, the more rural Sussex County actually saw a modest increase of 1.5% as buyers look for more space in the event of future quarantines; and 2.) Climbing Suburban Home Values - The increasing home values in commuter-friendly suburban counties with YTD advances seen for Bergen (8.5%), Union (11.7%),  Essex (7.4%) and Passaic (7.8%); and 3.) Urban Shift – Hudson County saw a 19.8% increase in median sale price in May.  This may be a combination of both high-end luxury development in Hoboken and Jersey City along with buyers moving out of NYC to something similar but not too far away after NYC was the hardest hit in the country by the virus.

The Lloyd Law Office is both fully virtual and fully present in its physical office.  We have adapted our practice to meet the needs of home buyers and sellers during the pandemic with cloud-based transaction management systems for client portal access as well as flexible signing and closing procedures.  With nearly 1,800 closings in North Jersey during the May 2020 in the midst of the global coronavirus pandemic, North Jersey real estate remains a strong investment and projects to see explosive growth in the third quarter of 2020.

About the Author

James Lloyd

Jim Lloyd is a husband, father and attorney. A graduate of Tulane University School of Law, Jim brings over 25 years of legal experience to help clients make strategic estate planning choices and to make buying or selling a house easier.

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