Northern New Jersey Residential Inventory Update
GSMLS
Single Family Homes, Condo, Coop
(Bergen, Essex, Hudson, Morris, Passaic, Somerset, Sussex, Union, Warren Counties)
4/12 - 14,812
4/19 - 15,126 (2.1% Weekly Increase)
NJMLS
Single Family Homes, Condo, Coop
(Bergen, Essex, Hudson, Passaic Counties)
4/12 - 7,259
4/19 - 7,429 (2.3% Weekly Increase)
MLSGuide
Single Family Homes, Condo, Coop
(Hudson County)
4/12 - 2,225
4/19 - 2,263 (1.7% Weekly Increase)
Single Family Homes, Condo, Coop
(Bergen, Essex, Hudson, Morris, Passaic, Somerset, Sussex, Union, Warren Counties)
4/12 - 14,812
4/19 - 15,126 (2.1% Weekly Increase)
NJMLS
Single Family Homes, Condo, Coop
(Bergen, Essex, Hudson, Passaic Counties)
4/12 - 7,259
4/19 - 7,429 (2.3% Weekly Increase)
MLSGuide
Single Family Homes, Condo, Coop
(Hudson County)
4/12 - 2,225
4/19 - 2,263 (1.7% Weekly Increase)
85 Comments:
For the curious in Bergen County, here are the number of residential listings NOT including condos & co-ops from NJMLS
03/03 3,132
03/10 3,230
03/17 3,337
03/23 3,432
03/30 3,543
04/05 3,628
04/12 3,706
04/19 3,781
On 4/14 the inventory had dropped to 3,696. But it looks as if the slow down in inventory I saw last week has reversed itself!
Use the word, spread the word: Bubble.
To paraphrase Robert Shiller, perception alone can cause the market to turn.
Houses definately aren't moving as fast as they were last year. Some realtors said that the spring season would pick up business.
North Jersey always sees sales pick up in the Spring. February is the lowest point of the year as far as closed sales goes. Even I would be concerned if sales didn't increase "in the Spring".
Sales will continue to increase until they hit their usual seasonal peak in June/July/August. Remember, these are closed sales, so the contract peak is seen around May/June. After that point we begin to decline until Febuary the next year (there is typically a slight bump in December as sellers and buyers want to close prior to year end).
The problem is we're quickly approaching the end of Spring, and still running at levels 10% or more under prior years.
Caveat Emptor!
Grim
More Houses for sale. Doesn't count the huge number of FSBO.
Housing Bust!
Booooooyaaaaaa!
Bob
BA BA BA BA BA BA BOYCOTT!!!
HOUSES....
ESCALATING INVENTORIES = MUCH LOWER PRICES.
BA BA BA BA BA BA BA BOYCOTT HOUSES
Bob
booya?
if there is in fact a bubble and we're headed for a bust, I really don't see why this is a reason to celebrate.
will it not be devastating to the economy and if so, won't we ALL get affected? what am I missing?
Why is it bad for home prices to go down 40-50%?
Why?
Many condos in early 1990's went down 50% and houses 25%+.
Not everyone is reliant on their house for survival. many own their houses outright and many have small mortgages. It is those 25% or so that bit off to much that are in trouble.
In the early 1990's the economy held up rather well considering the S&L bust and housing bust. I expect things to be a little worse this time due to the enormous amount of debt taken on by consumers.
Many that have lived within their means and saved will survive and flourish.
Those hotshots that live big but can't afford it are deadmeat.
Goodluck.
Bubble Pop mentality goes mainstream:
Gallup Poll
April 19, 2006
Seven in 10 Consumers Expect Housing Bubble to Burst
http://poll.gallup.com/content/?ci=22468
And Jim Cramer was on Jay Leno this week saying the housing bubble has begun to burst, and that he feels sorry for people who got into real estate recently.
7 in 10 say bubble.
Sentiment has definately shifted. No stopping the downward trend.
Denial turning to panic as sellers grasp reality. Realtors will change their tactics if they do not want to starve...pushing sellers to lower prices.
"The second line of the headline reads: Still, only about 4 in 10 expect housing prices in "their" areas to remain the same or decline."
Of course, it's called denial.
So the guy in NJ thinks the guy in PA will see a loss. And the guy in PA thinks the guy in NJ will see a loss.
They're both right.
NYC Bubble rap burst in early 1990's. Please explain why it's different this time?
Prices are going lower whether you like it or not.
Remember quite clearly a friend of mine telling me how he bought a Co-op in 1988 and it dropped 50%. it took him over 10 years to be able to break even.
THAT'S RIGHT FOLKS MORE THAN 10 YEARS!
AND THIS HOUSING MARKET IS MUCH MORE BUBBLY THAN THE LAST ONE DUE TO THE EASY LAX CREATIVE LENDING STANDARDS.
I consider Jim Cramer as a contrarian indicator. If he says buy this stock I'd sell it. If he says there is a bursting RE bubble then I think its almost over.
Anyone who lives in NNJ or NYC lives in the center of the universe. People want to live here. There will always be a demand.
Will there be a slowdown? Yes. Will prices drop? Yes but I highly doubt 40%. Are interest rates still low? Yes, 6.3% for a 30yr last I checked. That's very low by historical standards. Will it continue to fuel the RE boom? Sure but not as nutty as before. Chances are that you'll see moderation in the RE market and prices come inline with realistic fundamentals. Unless everyone decides to move to Tulsa OK.
Some people will blow up because they lived too large.
Is there a bubble of bubble watchers and bloggers? Probably! :)
My 2 cents.
jUST TO CLARIFY IT WAS A NYC CO-OP. AND IT DROPPED 50% IN VALUE HE SOLD IT IN 2000 FOR A SLIGHT PROFIT. 1988-2000 FOR A SMALL PROFIT.
IT WILL HAPPEN AGAIN. YOU WANT TO RIDE DOWN REAL ESTATE AND HAVE TO WAIT 10 + YEARS TO BREAKEVEN THEN GO AHEAD PUT THE HEAD IN THE SAND AND BUY BUY BUY. 10 YEARS IS A LONG TIME TO WAIT.
Why do you doubt prices will drop 40%?
They did in NJ and NY back in early 1990's.
Much more debt today than 15 years ago. Many more risky loans offered to fools today than ever before.
Denial can be painful.
Northern NJ is only minutes from NYC which is the greatest city in the world! Everyone wants to live in Northern NJ. House prices won't go down here.
I think someone is trolling....
The official blog estimate is a 30-35% decline in prices.
grim
(http://www.dallasnews.com/sharedcontent/dws/bus/stories/DN-Q&A_19bus.ART.State.E dition1.13656391.html)
"I consider Jim Cramer as a contrarian indicator. If he says buy this stock I'd sell it. If he says there is a bursting RE bubble then I think its almost over."
Jim Cramer's expertise is irrelevant to the point. Jay Leno introduced a "financial guru" to the public, who then said real estate is tanking.
The bubble pop message has hit the mainstream.
Gallup poll confirms it -- 70% of Americans expect the bubble to pop, do you think they'll be buying real estate anytime soon?
"Northern NJ is only minutes from NYC which is the greatest city in the world! Everyone wants to live in Northern NJ. House prices won't go down here."
Was NYC in the same location when the Northern NJ real estate market tanked 15 years ago, and people were financially underwater for years?
njresidence
PRICES REALLY DROPPED!
WHY IS THIS SO HARD TO BELIEVE?
IN THE LATE 1980'S-EARLY 1990'S HOUSING BUBBLE
PRICES GOT TO HIGH/OUT OF WACK AND THEY DROPPED AND CORRECTED IN PRICE.
NJ CONDOS WENT DOWN 50%
NYC CO-OPS WENT DOWN 50%
I KNOW PEOPLE THIS HAPPENED TO.
IF A CONDO WAS PRICED AT $225 3 YEARS AGO AND THEY WANT $500K NOW, YOU CALL THIS RATIONAL??????
SO IT'S OKAY TO GO UP 100% + BUT IT CAN'T GO DOWN TO CORRECT THE EXCESS?
ANYONE BUYING INTO YOUR CAN'T GO DOWN TALE ARE IN FOR SOME REAL MISERY.
The bubble pop message has hit the mainstream.
I seem to remember that back in late 90's to early 2000 the Dot.Com craze hit the mainstream. What did the stock market do after it lured mom and pop into investing in the can't lose Dot Com's? It crashed.
Now that the "bubble pop message" has hit the mainstream wouldn't it be ironic if the RE market decides to go up instead of bursting beacuse everyone who was waiting to buy decides to get in because prices have dropped?
Markets typically do the opposite what everyone thinks they will.
"Markets typically do the opposite what everyone thinks they will."
Are you still holding onto that cisco stock at $20, waiting for it to hit $100 again?
http://finance.yahoo.com/q/bc?s=CSCO&t=my&l=on&z=m&q=l&c=
See, that's the sticky thing with real estate declines. They are usually accompanied by a strict tightening of lending standards.
So even though people may want in, the lenders won't let them in, simply because they no longer qualify for a loan.
That is one of the reasons I've always preached about being a tightwad and saving every penny you can right now. 20-down might just become a common requirement again.
So while there might be "buyers" that want in, just how many of those will the system allow in.
So for those of you with minimal savings and poor credit that are hoping this crash will help you get into a home.. All I can say is you better get to work taking care of your debt and credit while trying to save up as much money as you can. If not, you might find yourself unable to purchase a home post crash. Not because you can't afford it, but because you can't get funding.
grim
In early 1990's many many people could not refinance their homes becasue of price drops. They didn;t have enough equity to refinance as rates went lower!!!
When the bubble burst in early 1990's Mtg rates trended lower from about 9% to 6% and home prices still went down.
This Housing bubble is much worse than 15 years ago. How bad will it get? who knows, but we will find out soon enough. Be prepared by saving at least 20% down. Liquidity is gong to tighten and this free money ponsi scam is ending.
Grim, don't you think it would be interesting to take a look at the ratio (current inventory/all existing housing units) in certain areas, maybe even zipcodes? It seems to me that towns where 5% of all houses are "for sale" will suffer from bubble burst much more than those where 0.001% of houses are on the market. Is it possible to obtain such a statistics and identify those areas/towns?
Can somebody help me here? Look at this house in crack town. I still cannot believe people are asking such insane prices for such junk. I have a 4 year college degree in accounting and have saved up a ton of cash and cash equivalents and can't even touch anything with a standard 30 year fixed rate mortgage with 20% down.
I probably should have just opted to work at Mc Donald's not that there's anything wrong with that.
You do however get a crack dealer on the corner. Location, location, location.
I feel like I'm going nuts. Up is down, left is right, buy high sell low.
KEANSBURG, NJ 07734
MLS ID#: 10061953
$240,000
2 Bed, 1 Bath
PRICES WILL DROP OVER 90% WITHIN 10
YEARS!! Face it now or face it later, the real killer here is that WE ARE RUNNING OUT OF CHEAP OIL REAL FAST!! If the NNJ home you
are looking at has a furnace - then DON'T BID ON IT. If it's in a place that requires a car to get there or to do anything while living there then FORGET-ABOUT-IT!
This whole area will go down the proverbial gurgler because it's hopelessly dependent on copius amounts of cheap oil which is rapidly running out. Within 10
years the NNJ burbs will be well on its way to being an unihabitable
wasteland where abandoned homes and buildings will be mined for copper and other scrap. And that's the optimistic scenario folks!
Housing is DOOMED!
Might as well walk away Or sell as fast as you can at any price.
Just get out before it is to late!
"PRICES WILL DROP OVER 90% WITHIN 10 YEARS!!"
Is this poster a ®ealtor sock puppet or what?
Chester-mendham going be toast like every other area. bring your snoot down.
I expect to see quite a few foreclosures in these so called upper areas.
Watch and learn boy.
Yes that's right many have been living in their houses for 20-3-40 years and many could not afford the house they live. they have been beneficiaries of a long-term bubble. However the bubble is vursting now so those big paper gains are starting to evaporate.
Somehow it always seems that it can't happen in my town.....
So first Summit won't be affected, now Mendham, what's next? I say Camden, after all it can only go up!
1) Neither Chester nor Mendham are in the Highlands Preservation area. So your basic premise is incorrect.
2) The Highlands act does not ban all development, it just it makes it harder and there are provisions for transfers of rights.
Looking on GSMLS, I see 83 houses for sale in Mendham township. That doesnt' count other MLSes or FSBOs. Given the very small population of the town, thats a pretty large number.
I agree with Skeptic, no bubble for the nicer towns. You want an explanation for 100% rise in prices over 5 years. Change in perception -
1) people want to live near NY,
2)people's tolerance for commuting longer distances is growing so that Mendham and Chester aren't bad commutes
3) More families operate on two incomes, and those who didn't were/are forced to in order to afford housing
4) isn't it possible that houses were undrevalued 5 years ago
5) the shady credit you all refer to just opened up the market to more people - now the less affluent can buy as well, and if they bought early, then they have a nice cushion of equity - I don't think the newer lending practices will cause the market to crash, I think they fundamentally changed the market by creating demand across a broader demographic
No bubble, no burst, just a slight dip or a leveling off. I've said it before and I'll say it again. You want to live in NNJ, turn out those pockets and get used to the idea of housing taking up 40-50% of your income. If you want to be here, compete with the other 22 million who want the same thing.
Boomers going to be stuck holding the bag trying to offload their McMansions and high fixed cost. Good luck nobody going to want 'em.
You don't worry if it's worth 90%less once off the lot. I can assure you if this was the case New car sales would come ta a complete halt.
That was on of the most idiotic stamements i have ever heard. i know people are being fools buying houses at these obscene insulting prices but to say someone would still buy a car if it drops 90% once off the lot is dumb.
Psychology will kill this housing market and it is shifting negative.
Not much behind them? Of course not, their just thoughts. I just don't think you can point to what happened in the late eighties and early nineties and expect a guarnteed similar scenario. My point is that there are some intangibles that can't be quantified. I could be wrong, I'm no economiologist (joke), but aren't a lot of areas of economics perplexing right now? The stock market jumps after the Fed has a meeting and says the same stuff its been saying for months. The fed raises rates and yet mortgage rates continue to hover. Economics is not an exact science, so when people have the opinion that the housing market in the area will level off over a longer period rather than crash, what's the harm.
Again, you have to pay to play. You wanna be in NJ, turn out those pockets.
Great blog. Any thoughts on whether the choice, best towns along the Midtown Direct corridor, such as Summit, Chatham, Madison, Short Hills, etc., will remain unaffected regardless of whether the bubble bursts
What we are seeing in the market is the death of the RE Bull and the birth of the RE Bubble Bull!
Booo Yah!
reinvestor101: Flippers/speculators/homeowners are greedy SOB's. It's their fault for pushing prices sky high. Everyone is greedy and people are gonna get burned! Too much debt! I hope for a 50% corection!
Boooyah! Supply and Demand, thats American Capitialism at work!
"Great blog. Any thoughts on whether the choice, best towns along the Midtown Direct corridor, such as Summit, Chatham, Madison, Short Hills, etc., will remain unaffected regardless of whether the bubble bursts"
Every house in NJ and across the nation will lose value, except of course for the towns along the Midtown Direct corridor.
The massive real estate decline 15 years ago can never happen again, and especially to the towns along the Midtown Direct corridor.
Real estate only goes up! Now is the time to buy cisco stock, it will go back to $100 just like in 2001, trust me!
Skeptic & Reinvestor 101, what did you expect posting on a housing bubble opinions contrary to the prevailing consensus?
The U.S. is going to be fine, because as a country we are smart and we break our a--es.
Yeah we have problems, but we also have a tremendous amount of vision, ambition, and pride.
In the worst times, this country is resilient. Don't bet on real estate, but don't bet against us either.
chicago
Every time I see the interest payment added to my bank account at the end of each month, because I haven't bought a house over-priced by 100%, I say Boooyaaaah!
How can you beat having a housing cost of practically $0? Boooyaaaah!
And when I buy a foreclosure property in 18 months, or swoop down on some flipper sitting $200K underwater and pay cash for the property, I'll say Boooyaaaah!
"Great blog. Any thoughts on whether the choice, best towns along the Midtown Direct corridor, such as Summit, Chatham, Madison, Short Hills, etc., will remain unaffected regardless of whether the bubble bursts"
I wouldn't say unaffected, but, the value in these Midtown Direct towns is likely to hold better than in the lesser towns. Not only do you have the fantastic commute to the City but many other attributes: great schools, town services, nonexistent crime, etc. Rarely do you find all of these attributes in one place in NJ. At the end of the day, places like Summit and Chatham are where most people would want to raise their families (if they could afford it-- but how many of us can) and that won't change. The demand will be there, although sellers wont get what they could have gotten during the bubble years (slightly less).
And best yet, in 5 years prices in Summit and Chatham will be 100% higher than now! Buy now before you're priced out forever!
That's right, in 5 years this house will cost $1,000,000:
http://www.realtor.com/Prop/1057279476
It's only natural, it has a good commute with good schools!
Don't wait! Ask your boss for a raise, and buy now!
To Anon at 9:09 p.m.
Aaaaaamen!!! Booooyah right back at cha..LOL
Housing Bust!
Ba ba ba ba ba ba BOYCOTT Houses!
Soaring inventories = Bad news for sellers
Watch the FSBO signs up all over the place. Deny deny deny!!!
Hehehhee
Booooyaaaaa
Bob
"Sales Decline Twelve Straight Months In Bay Area"
http://thehousingbubbleblog.com/?p=521
"Say Farewell To The Housing Boom On Long Island"
http://thehousingbubbleblog.com/?p=512
"Condo Market Has 'Totally Collapsed' In Naples"
http://thehousingbubbleblog.com/?p=511
"Record Inventories Discourage New Projects"
http://thehousingbubbleblog.com/?p=510
You'll see that Chester is in the Core Area (one house per 88 acres MINIMUM), and the Mendhams are in the Planning area.
Chester is partially in the preservation area. Not fully, and the mendhams are not at all.
http://www.state.nj.us/dep/highlands/municipalities.htm
Even in the core area some development is allowed, and its definitely not one home per 88 acres, Where did you get that ?
Yeah, so MUCH harder that it's almost impossible (money spent on lawyers would be much greater than any potential profit from a subdivision)
Not correct at all. And even in the preservation area, some development is possible, its mostly a matter of development alongside water. Plus, there will almost certainly be TDRs (transfer of development rights). If you're relying on this act to preserve your property value, I think you're going to be disappointed.
I didn't follow the Mendham's RE market closely, but I've been watching the one in Chester township for more than a year
I could do the same inventory check for Chester. In any case, Mendham has a huge amount of inventory for such a tiny town. That will put pressure on prices.
Realtors will be pounding the table for sellers to chop prices.
Insulting prices + higher interest rates = No buyers
You can't call yourself an American wish something bad for your country and your fellow citizens
The RE boom has made housing unaffordable for a large number of people. It has made people take on debt they can barely shoulder. It has led to overinvestment in housing instead of in truly productive assets. It has most definitely not helped my fellow citizens.
Looks like someone is leveraged to the @ss and is dreading the fall to come.
Insulting prices + higher interest rates = No buyers
Insulting prices - exactly!
"Anyway, my wife and I are going to check out Raleigh/Cary in 2 weeks."
Please let us know how it goes, you're not the only one considering such a move out of NJ.
Let "reinvestor101" spend a million bucks for a shack that needs massive repairs.
What a thread!
Hey, do you think "skep-tic" will come in tomorrow and have a duel with "skeptic"?
REINVESTOR101
Really, enough of the mom and apple pie flag waving already. No one here is anti-American.
The RE bubble is BAD for America. The sooner we put it behind us, the sooner we can apply our great nation’s resources to investing in real economic growth, instead of flipping houses with granite countertops and stainless steel refrigerators.
And what happens when our younger soldiers serving in Iraq return home and want to start families? What do we say to them? “Sorry, thanks for your service, but you’ve been priced out of the market…should have stayed home and became an RE investor”?
BTW. If you really want to be an American, don't buy RE using a mortgage. Much of the cheap money is coming from China.
""If I can't pay it, I'll sell the house."
And when the dust settles form this bursting bubble, she'll be selling that house at a substantial loss.
Um... yea, I couldn't get over the amount of inventory in Bergen County either.
My country tis of thee
sweet land of usury
of thee I sing
Land where my ARM adusts,
Land where my bubble busts,
I should've learned not to trust
Sirens of real-tee
anonymous 11:29 PM
Classic!!!
bobby
For a single-family home, the applicant proposes no more than one septic system for each 88 acres of land
That is only for lots where certain conditions hold (more than half the lot is forested) and its only for septic systems, not for other waste water disposal systems and there are exceptions as well. Its a far cry from your original claim that only 88 acre lots were allowed.
Same thing goes about anything else that I said regarding the Highland act: I live here, in the conservation area, I have spoken to the EPA guys who oversee the compliance, I know my stuff
You haven't really shown that with your inaccurate statements so far.
Every town has some reason why prices are immune from dropping. But every area went down during the last showdown. THis will be no different.
Why are you guys so concerned with where houses aren't built yet, there is exploding inventory of existing homes.
There are 18,907 homes for sale in Northern NJ (see post 1 and 2) and climbing every day as buyers refuse to buy into the real estate ponzi scheme.
Reinvest101, I've said it before and I'll say it again: you would be much better received on this blog if your posts were based less on emotion and more on data.
Your tendency to label anyone who supports the idea of a housing bubble as "anti-American" is insulting and inflamatory and I for one will be the first to suggest that if you can't refrain from this type of reactionary rhetoric that you not post on this blog. There are plenty of places where you can find people who agree with you--most of the mainstream media denies the existence of a housing bubble, some recent examples notwithstanding.
The fact that you target posters like "Booyaaaah Bob" supports my assertion that you gravitate toward the emotional. I don't see you quibbling with posts by ChicagoFinance, MetroPlexual, RentingInNJ, Grim and others who support their posts with data and are well thought-through.
I think it's fair to say that many on this blog want to see a housing market correction. But I don't think any of us want to see people go to financial ruin. This is pure business. In my case, the only way I will be able to own a home is if the market corrects to reflect fundamentals. The fact that some of these people may have made bad finanical decisions and may ultimately suffer severe consequences isn't anyone's problem but their's.
Phoenix inventory exploding at 40,000 homes for sale and climbing -- no bubble here!
Buy now, before it's too late! Being a bagholder is a good thing!
7/20/2005 10,748
7/31/2005 11,609
8/1/2005 11,599
8/31/2005 15,099
9/1/2005 15,063
9/30/2005 19,192
10/1/2005 19,333
10/31/2005 23,790
11/1/2005 23,601
11/30/2005 26,797
12/1/2005 26,792
12/31/2005 26,497
1/1/2006 26,462
1/31/2006 32,563
2/1/2006 32,684
2/28/2006 36,174
3/1/2006 36,389
3/6/2006 37,217
Northern NJ catching up at 18,907 homes on the market!
http://money.cnn.com/2006/04/18/
real_estate/agents_bearish_in_blogs
/index.htm
Real estate insiders go bearish in blogs
In mostly anonymous postings, agents are reporting big problems in the markets.
By Les Christie, CNNMoney.com staff writer
April 18, 2006: 9:57 AM EDT
NEW YORK (CNNMoney.com) - If the secret worries of real estate professionals are any indication, home prices could be heading for a swoon.
When Brad Inman of Inman News, which tracks the real estate industry and is widely read by industry insiders, recently gave real estate agents the opportunity to blog about market conditions, they almost uniformly described them as bad – and getting worse.
"Normally, brokers and agents tend to sugarcoat the news; they don't want to affect consumer confidence," says Inman. "By letting them post anonymously, we gave them a way to really share their thoughts."
Most responded with tales of high inventories, slow sales and languishing prices.
Here's a sampling of their comments:
"Portland, Oregon is mixed . . . more inventory, sitting longer. . . . Sellers no longer king." Posted by anonymous.
"Minneapolis/St.Paul . . . 15 houses per buyer. If we had buyers. Huge inventory in every price range. More foreclosure properties coming on daily." Posted by anonymous.
"East Central Florida Coastal area inventories up four times year to year and sales down 75%." Posted by Ramon Rivera (Not all bloggers craved anonymity).
"Some Realtors, Mortgage Brokers & some clients have been more testy than in months previous. Something is in the air." Posted by S. Crowe.
"Northern Ca. Let's not beat around the bush here. There is a slow down!! Home prices are not going up. Sales are down." Posted by anonymous.
New York Population Loss Is Linked to Cost of Housing
http://www.nytimes.com/2006/04/20/us/20census.html
"Morris housing market cools off"
http://www.dailyrecord.com/apps/pbcs.dll/article?AID=/20060409/COLUMNISTS04/604090328/1103/COLUMNISTS
Seven in 10 Consumers Expect Housing Bubble to Burst
Still, only about 4 in 10 expect housing prices in their areas to remain the same or decline
by Dennis Jacobe
GALLUP NEWS SERVICE
PRINCETON, NJ
National Housing Bubble
--
Increasing mortgage rates and a growing inventory of unsold homes likely has many U.S. consumers wondering about whether the sharp increase in housing prices over recent years -- the "housing bubble" -- will burst at some point during the coming year. Seventy-one percent of consumers believe it is very likely (24%) or somewhat likely (47%) that housing prices will collapse in housing markets across the nation as a whole within the next year, according to the April Experian/Gallup Personal Credit Index survey.
Local Housing Bubble
Consumers are far less pessimistic when it comes to their local housing markets. Only 32% of consumers think it is very likely (7%) or somewhat likely (25%) that their local areas will experience a housing bubble in the next year. For that matter, 28% of consumers say such an eventuality is not at all likely.
Gallup Poll: Seven in 10 Consumers Expect Housing Bubble to Burst
The public is finally starting to see that houses priced at 10 times income, and doubling in value every 4 years, is nothing but a speculative bubble like the dotcom stocks which vaporized trillions of $$ in wealth.
Sell, sell, sell -- if you can, with inventory approaching 20,000 homes in Northern NJ alone.
Don't hold on all the way down, if you can't afford to be underwater on your mortgage for the next 8-10 years.
Get out now before your ARM resets, and you can't afford the skyrocketing payments, and can't bail out by selling when no buyers exist.
For if you ride it all the way down, and the balooning mortgage payments become too much later on, those waiting in the wings with cash will be on the courthouse steps to buy your house at pennies on the dollar.
http://www.foreclosure.com/state/nj.html
NJ - State Info
Updated: 4/20/06 12:32 AM
Foreclosures: 403
Preforeclosures: 1,533
Bankruptcies: 7,743
I have seen a number of foreclosures over the million dollar range.
Don't buy in that the so called upper areas are immune to a dramatic price decline.
Watch.
It sure seems like an artic freeze now. What spring selling season.
eeeeehhhhhh
richard,
inventory is also exploding in summit....locals are saying "you seem to get more for your money this year"....translation, price declines.
People who think they are immune are kidding themselves. The Mid Town direct towns will also suffer. For the higher priced homes corrections will be more severe.... decline of 20% on $2 Million is a quick 400K out the window.
I am really interested in the arguments that real estate prices in whatever-area-I'm-in won't go down. I moved up here from western North Carolina (which I really love, and would move back in a second, if there were any jobs). My extended family still lives there. My mom agrees with me that New Jersey is in a bubble, but insists North Carolina isn't, because 'people want to retire here, and the housing is cheaper'. It is cheaper, but prices have still doubled in the last few years; I have a friend who bought a house in Asheville in 2000 for 100,000 and just had it reappraised for 250,000 and used the equity to pay off credit cards (ack!). I recently noticed some condos in downtown Asheville that were 1 bedroom/1bath going asking $400,000. I wouldn't pay 400,000 for a one bedroom anywhere, but my mom says people will there, because they are really nice, and everybody wants to move there.
125 comments?
impressive
one thing to remember...in an inflationary environment you want to make sure you have a house. If anyone thinks in 30 years the dollar will be worth what the bank will loan it for today...they are crazy...the price of gold has gone up from 250 to 640..silver went from 5 to 14...oil is back over 70 per barrell..it is not the housing has gone up...it is that the dollar has gone down...and it will continue to...that is that whole budget deficit / national debt thing...how do you expect we could ever pay our debts back to these countries..of course the only way is to depreciate the currency..that means everything including housing gets more expensive..if you have a 30 yr fixed loan you are in a much better positon than if you rent...there will be no general deflation in an environment where inflation is raging..which in case no one noticed ..we are right in the middle of.
Anon 8:50
We wanted to move to Asheville from CA but foudn that the housing there was on average 30-35% cheaper than NJ for a comparable home (although the taxes were much better), but salaries were 50% of what we might expect here. I ws offered a job by Biltmore for more than 50% less than I make here for the same thing, and my husband wasn't sure if he would even be able to find a job there (and in NYC it took him exactly one day).
Overall, given the economics of Asheville, we find it to be horribly overpriced for no reason. It has no real industry save tourism which isn't even THAT substantial, and didn't seem to be heading in any kind of growth direction. Many of the houses we looked at in the fall were boomers' second houses they were trying to unload. We almost put in a bid on one for $650K in Fairview that the owners bought 5 years ago for $599K, and they've lowered the price again to $625. It's been on the market more than 7 months now.
And that's my 2 cents on WNC! Pity because it's so lovely there.
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