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Home Under Foreclosure
New Jersey residents are in better financial shape than most others across the country, according to a new study by one of Wall Street’s regulators. But the results still show New Jersey residents need to do more to make themselves secure financially. The nationwide survey, conducted by the Financial Industry Regulatory Authority has found that folks in New Jersey are more likely than most to spend less than what they earn, set aside money for rainy days, and save for their children’s education. These are very sound money management principals but they are ones that will stimulate buying.
Financial Statistics
About 46 percent of New Jersey residents said they don’t spend above their paycheck, while 45 percent have an emergency fund. Meanwhile, 40 percent of those with dependent children have a college fund for their kids. One surprising result was that New Jersey — hard-hit as it was by the housing crisis — scored a slightly better-than-average result when it came to homeowners who are underwater on their mortgage. Just 13 percent said they owe more on their home than what it was worth, compared with 14 percent nationally. To give you an idea of your home’s value, have a property appraiser come out to give you a property appraisal.
The median New Jersey home sold for $273,900 in the first quarter of 2013 and $292,200 in fourth quarter 2012, indicating -0.5 percent and 5.3 percent growth over the respective quarters one year prior. Some of the state’s most influential real estate analysts, eluded that this year’s home prices will settle three percent higher than last. That being said, “Now is the time to buy”! This is a once-in-a-generation opportunity for someone to buy at the bottom of the market with once-in-a-lifetime mortgage rates. Don’t miss the window.
The boost to the housing market stems from a job market that’s recovering slowly, and mortgage interest rates that averaged 3.53 percent for a 30-year fixed loan, That news, was tempered by a report by the Mortgage Bankers Association that average mortgage rates for the month of May had hit 3.9 percent for loans under $417,500 — the highest they’ve been in a year. April’s national unemployment rate fell to 7.5 percent, with New Jersey’s rate dropping to 8.7 percent — the lowest it’s been since March 2009.
But in New Jersey, low interest rates can only do so much. Housing inventory remains at its lowest levels in eight years and has declined 20 percent since last year. On average, homes sell within 6.2 months. North Jersey homes sell more quickly than their counterparts thanks to their proximity to New York City’s job market.
Foreclosures
The foreclosure rate is climbing in New Jersey while other states are experiencing a decline. Nationwide in the first quarter, foreclosures fell 26 percent from last year, but in New Jersey the year-to-year number rose 49 percent over last year. Another trend is that the number of negotiated short sales is accounting for a larger share of total foreclosure sales, which typically results in a higher selling price than would occur at auction.
In Conclusion
Hurricane Sandy victims are either fixing up their homes for habitation or rental or they’re selling them as is. Of those who lost their homes, some have or are entering the market but in numbers too small to influence demand or prices by any significant amount. As for why other potential “home sellers” across the state are reluctant to put their houses up for sale is because a lot of people are still concerned about their jobs and the economy
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