For Immediate Release:
January 14, 2010
10 Real Estate Facts for 2010
(Edison, NJ) The turn of a new year comes with both question
and promise regarding New Jersey real
estate. To prepare for the year ahead, the
New Jersey Association of REALTORS® (NJAR®)
has assembled a list of ten facts regarding
the current state of real estate to offer
some perspective on what to expect in 2010.
"NJAR®'s quarterly housing statistics over
the past year have generally indicated home
sales rising and prices stabilizing
throughout the state," said NJAR® 2010
President Judy Appleby. "These increases in
buyer activity should spur further
confidence in Garden State housing. Plus,
expiration of the federal home buyer tax
credit in April should spark a dramatic
spring buying season that will hopefully set
the tone for the remainder of the year in
many of New Jersey's various markets."
1) First-time buyers are taking action, and
for good reason. In 2009, first-time buyers
made up 52 percent of the New Jersey real
estate market, compared to 49 percent in
2008 and 36 percent in 2007. First-timers
were spurred by high affordability, low
rates, and the $8,000 federal tax credit,
which has been extended to April 30, 2010.
An estimated 45,700 first-time buyers took
advantage of the credit last year, and it is
expected to be a strong incentive for
first-time buyers early this year.
Source: 2009 Profile of NJ Buyers and
Sellers
2) Homes in the Garden State are a good
investment. The seven-year home appreciation
rate in New Jersey is 37.1 percent, more
than five times the national rate of 7.1
percent. Likely due to the inherent
advantages that the Garden State has to
offer (great schools, unique neighborhoods,
proximity to New York and Philadelphia, and
access to the shore), New Jersey outperforms
the national average in home appreciation.
Source: NJ Market Summary, June 2009
3) It's a great time to trade up. The 2009
federal tax credit for first-time buyers has
been expanded to include repeat buyers. That
means that existing homeowners can qualify
for up to $6,500 (or $3,200 for those filing
separately) when they buy a home - a
significant incentive to trade up to that
dream home.
4) Waiting for prices to drop could cost
you. A buyer obtaining a 30-year mortgage of
$300,000 today at a 5 percent interest rate
will pay approximately $1,610 each month in
principal and interest. If that same buyer
waits until sale prices drop five percent,
he/she runs the risk of interest rates going
up. A 30-year mortgage of $285,000 at a 6
percent interest rate will cost the buyer
$1,708 per month in principal and interest.
Those few percentage points can equate to
thousands of dollars over the course of a
mortgage.
5) Owning a home in New Jersey builds
long-term wealth. New Jersey home buyers who
purchased their homes seven years ago
accumulated an average of $81,100 in home
equity. Over the last decade (1998-2008),
the median prices of homes in almost every
metropolitan statistical area that covers
the state have more than doubled.
Source: The NATIONAL ASSOCIATION of
REALTORS®(NAR)
6) It's a prime time to buy a second home.
Especially in a state like New Jersey, with
a great second home market in shore towns
and other vacation destinations, now is a
great time to purchase a second home. The
2009 median price of a second home in New
Jersey was $246,300. Because of the
relatively high amount of inventory, there
are plenty of affordable options that, when
paired with low interest rates, could be
once-in-a-lifetime opportunities. Who
wouldn't want their investment to double as
a vacation getaway and a foundation to build
lasting memories?
Source: 2009 Profile of New Jersey Buyers
and Sellers
7) There is still time to take advantage of
historically low interest rates. Many
experts agree that the rates won't stay too
low for long, but there is still time in
early 2010 to take advantage of rates that
have dropped significantly. Consider that in
the third quarter of 2008 the average
Northeast rate was 6.27. For the third
quarter of 2009, the rate was 5.22.
Source: Federal Housing Finance Board
8) Good news for sellers: New Jersey
consumers are "buying in" to real estate.
The vast majority of New Jersey buyers (86
percent) saw their purchase as a good
financial investment, with 57 percent saying
it is a better financial investment than
stocks. Also, when asked about the primary
reason for the timing of their home
purchase, 46 percent of first-time buyers
said it was just the right time.
Source: 2009 Profile of NJ Buyers and
Sellers
9) Lower prices make homes more affordable.
The median price of a single family New
Jersey home in the 3rd quarter of 2009 is 11
percent lower than in the 3rd quarter of
2008. The housing affordability index during
the same time period increased by 22
percent. NAR's housing affordability index
measures whether or not a typical family
could qualify for a mortgage loan on a
median-priced, existing single-family home.
Increasing levels of affordability mean a
home purchase is within reach for more New
Jerseyans than the same time the year
before.
Source: New Jersey Home Sales Report, 3rd
quarter 2009
10) There are 50,000 REALTORS® in New Jersey
that can provide you with localized
information. Whether you are buying or
selling, REALTORS® provide expertise on
market trends, property conditions, and many
other aspects of a real estate transaction.
85 percent of home buyers used a real estate
agent or broker to purchase their home, as
compared to 84 percent in 2008 and 76
percent in 2007. 88 percent of sellers were
assisted by a real estate agent in selling
their home.
Source: 2009 Profile of New Jersey Buyers
and Sellers
The New Jersey Association of REALTORS®,
with approximately 50,000 REALTOR® and
REALTOR-ASSOCIATE® members, is one of the
largest trade organizations in the state.
NJAR®'s membership is comprised of real
estate professionals who subscribe to a
strict Code of Ethics and are members of the
national and local REALTOR® organizations.
As the leading advocate for the real estate
industry and private property rights in New
Jersey, NJAR® is committed to protecting the
dream of homeownership. For more
information, please visit www.njar.com.
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