DECEMBER 2022 HOUSING MARKET

Rates Drop For 3 Weeks Straight

The past few years have shown a strong correlation (I would even argue causation) between mortgage interest rates and home sales. Lower rates mean more buyers, more buyers mean less inventory, less inventory results in higher home costs. Mortgage rates are set on a national level, and while the rest of the nation may be headed toward a buyer’s market, this area is still a strong seller's market, buyers should take advantage while they can.

In October (remember our MLS statistics are delayed by 45+ days) Bergen County saw a -31.8% drop in the number of homes sold compared to October 2021, but those homes still sold for 6% more than the previous year. This while the state of NJ averaged a -15% reduction in home sale prices. Although the state of NJ saw a decrease in home prices, Bergen County’s lack of inventory (-31.8%) means home prices are holding strong (+6%).

 My advice for buyers every holiday season is if you find a home you love, do whatever you can to get under contract as soon as possible. This is especially true this year. Come January we always see an influx in buyers which means more competition.  If rates continue to trend down a significant number of buyers who took a break when we hit 7%+ will resume their search thus driving up prices once again. Buyers who purchase a less expensive home with a higher rate can always refinance later, but little can be done about home prices in a competitive market with lower rates.

 Sellers, get your homes ready for January!  If you have the nicest home on the block you can hold out to see if lower rates bring back the insane terms we saw at the height of the Covid market.  If not, take advantage of the lack of inventory and list early in 2023 when inventory for most homes (under $2M) tends to be at its lowest.

Renters, rent is up over 50%.  You might not realize it but you are already paying a mortgage, it just isn’t yours.  Give me a call and I will connect you with my trusted loan officer to get you pre-approved so you can start building equity.