Fair Haven’s real estate has been in a “seller’s market” for more than a year, so you might expect home prices to be higher than they were a year ago. The question is, how much higher are they? According to the most recent (February) S&P/Case-Shiller home price index, nationwide home prices are 12.9% higher than a year ago, so you might expect to see a similar percentage here.
If you’ve been following my posts you know that you need at least 20 home sales in both years in order to have statistically-significant year-to-year comparisons. Fair Haven is a small town, with only about 100 home sales per year, and it usually takes until the end of April to reach the 20 sales mark. This year we’ve had 26 Fair Haven homes sold in the first 4 months of the year, but last year we only had 19, so I’m going to say that my percentage calculations are “unofficial”. That being said, the numbers show an impressive 19% increase in the median sales price in 2014 based on a 37% increase in the number of home sales.
Other good news for Fair Haven home sellers: there are 9% fewer homes listed for sale than there were a year ago (a lower inventory of homes for sale normally translates into higher selling prices). In addition, the all-important real estate absorption rate is 3.0 months now, compared to 4.3 months a year ago. The real estate absorption rate is a calculation of how many months it would take to sell ALL of the homes currently listed for sale, assuming that homes will continue to sell at the same rate that they have in the past 12 months. It takes into account both supply (i.e., inventory) and demand (i.e., sales). An absorption rate of 5 – 7 months is considered a “normal market”, whereas greater than 7 months is considered a “buyer’s market” and less than 5 months is considered a “seller’s market”.
Here are the 4 objective real estate indicators in tabular form:
|Fair Haven Home Sales, Jan 1 – Apr 30|
|Sales (Demand)||19||26||37% more sales.|
|Listings* (Supply)||32||29||9% fewer listings.|
|Months’ Supply* (Absorption Rate)||4.3||3.0||Stronger Demand vs Supply.|
|*based on the past 12 months|
|Median Sale $||$620,000||$739,500||19% higher median sales price.|
If you’ve been thinking of buying a home in Fair Haven, you’re going to have to pay more than you would have a year ago. Continue using the internet to search for homes in your price range. Drive by houses that look interesting, and get an idea of what the neighborhood is like. However, if you find a house you’d like to visit, I strongly recommend that you DON’T CALL THE LISTING AGENT (even if it’s me). The Listing Agent works for the Seller, and has a fiduciary responsibility to negotiate the highest sales price for the owner. You want to be represented by a Buyer’s Agent who will work only for you, and who will have a fiduciary responsibility to negotiate the lowest sales price for you.
The first time you meet with a real estate agent in New Jersey, he/she should give you a copy of a “New Jersey Consumer Information Statement” and explain its contents to you. Read it carefully when you get home- if you have any questions about it give me a call. It would be my pleasure to be your Buyer’s Agent, whether you’re a first-time home buyer or one who’s owned several homes.
(732) 239-0739 (cell) (732) 530-6686 (office)