There simply aren’t enough houses to go around! Inventory shortages have once again pushed home prices to a record high.
For the first time, the average home sale price in Staten Island cracked $700,000. The average property now sells for $707,376, an amazing $45,251 increase in just one month! In Monmouth and Ocean Counties, the average home fetched $540,740. Although this was up 14% from last year’s $474,411, prices in New Jersey appear to have stabilized over the past few months.
The inventory squeeze has created high buyer competition in both markets. In Staten Island, just 1,228 listings are available for the entire county. By contrast, 1,763 homes were listed at the same time last year. This hot seller’s market offers 30% less inventory than it had last year. In New Jersey, active listings fell even sharper at a 39% decrease.
Days on the market is also down sharply in both markets. The average home now takes just 30 days to sell in New Jersey. In Staten Island, home sales closed in 74 days. This is also a big shift year-over-year. Days on the market shrunk 20% in Staten Island and 23% on the Jersey Shore.
Despite similar trends, Staten Island home prices have risen much faster in recent months than homes on the Jersey Shore. New Jersey homes got a big price bump in spring 2021 but have leveled out ever since, hovering around $535,000 every month since May. By contrast, Staten Island homes continue their ascent higher with sales rising. One noted decline in New Jersey is the total sales, down about 20% over last year. In Staten Island, sales are about the same as last year’s 465. For January, which is the slowest month, 449 sales is very impressive. Normal Januaries come in at fewer than 300 sales.
With interest rates rising, home affordability may become a bigger issue in the coming year. Mortgage rates are now at a 3-year high of 4%. With an increase of just 2% in borrowing rates, that $707,376 will cost quite a bit more each year in mortgage payments. We will also have to keep an eye on Wall Street moves in the coming months as well. The financial markets have a real pull when it comes to consumer confidence.