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A Closer Look at Our Local Scene
One thing is clear as we step into March: the influx of new listings that many were hopeful for
has not materialized. Our inventory remains startlingly low, indicating we are still navigating a
housing shortage. The year kicked off slowly, not because demand waned but because the
houses weren’t there to sell. With a slight uptick in listings, we are witnessing multiple offer
situations become familiar once again, albeit with renewed vigor due to the pent-up demand
waiting on the sidelines.
However, this poses challenges and opportunities:
● For Buyers: Brace for the possibility of multiple offer scenarios, especially on properties
in prime condition.
● For Sellers: The current market underscores the importance of correct pricing. There is
a spread of properties lingering unsold and priced based on the 2022 market
expectations, and these properties are no longer viable.
Owners are clinging to their valuable equity and low-interest rates, further contributing to the low
inventory. Conversely, a legion of buyers remains in waiting -- for more houses to surface or for
interest rates to dip, which could invigorate the market dynamics.
What the Fed Says
With the Fed’s next meeting slated for March 20th, the consensus leans towards maintaining
the current federal rate. According to industry experts, the gap between the ten-year Treasury
rate and average mortgage rates suggests room for a downtrend in mortgage interest rates
throughout the year.
Data Deep-Dive
Inventory Trends: In Atlantic and Cape May counties, inventory levels persistently trail below
the national average, intensifying our uniquely competitive market. Despite a minor uptick, our
local inventory rates remain firmly within a seller’s market, defined by less than five months of
inventory.
Interest Rate Projections: While exact figures remain speculative, there's optimism towards a
decrease in interest rates, possibly touching the high fives, influenced by the gap between the
ten-year Treasury and current average rates.
Showings and Buyer Interest: The number of showings in New Jersey for 2024, represented
by the orange line, demonstrates robust buyer interest, nearly paralleling the activity seen in
previous, busier years, despite the shortage of listings.
Economic Confidence and Market Resilience
Economic sentiments have shifted positively compared to last year. The percentage of
economists predicting a recession in the next 12 months has dropped significantly, from 61% to
39%, marking an uptick in confidence among experts.
A Word on Home Equity
The wealth stored in homes across New Jersey is a buffer against financial uncertainties. A
significant portion of homeowners possess over 50% equity in their homes, offering resilience
through the capability to liquidate assets in financially tight situations.
Wrapping Up
March 2024 brings with it a careful blend of challenges and opportunities in the New Jersey real
estate market. Low inventory and high buyer demand are creating a dynamic environment,
while the possibility of decreasing interest rates and strong economic confidence provides a
hopeful backdrop.
Whether you're thinking of buying, selling, or simply staying informed, navigating the New
Jersey real estate landscape requires patience, perseverance, and an understanding of the
market mechanics at play.