Real Estate Market’s Wild Swings (Staten Island/Jersey Shore Aug. 2022)
Experts agree- this is a weird market which is nearly impossible to pin down or predict.
In tandem with government interest rates, mortgage rates have been the rise for some time. The 30 year fixed rate had once soared to around 6%, which is the unofficial tipping point into a buyer’s market. However, this past week it came down to 4.99% according to Freddie Mac. This is the first time borrowing rates have come below 5% since April.
And though we saw some apprehension when rates began to rise, real estate fundamentals have come back strong for the month of August. In fact, prices hit another record high in Staten Island! The average home in the borough sold for $743,800 in July! On the Jersey Shore, prices tend to swing more wildly. The average price came down from a record in June to a respectable $582,456 in July.
Both markets have seen growth spurts within the last few months that are not typical of all US markets, many of which have lagged since pandemic restrictions lifted. And it is simply stunning how fast homes are selling here. We also have a near record-breaking speed in both areas, with a home taking just 21 days to sell on the Jersey Shore and 58 days in Staten Island!
Interestingly, sales are down quite a bit from last year in Monmouth and Ocean counties. In Staten Island, active listings seem to have equalized. Sales in Richmond County are down slightly from last year (460 from last July’s 487) but new listings are down significantly. Only 549 homes were listed in July, compared to July 2021’s 620. However, active listings are about the same as last year at 1,767. New listings in New Jersey’s Monmouth/Ocean counties fell about 8% year over year to 3,971.
Sold-to-list ratio is another important indicator. The percentage fell slightly in both markets this past month. The New Jersey market peaked in May at a red hot 104.5% compared to list price! The Jersey Shore experienced a slight fall to a still-impressive 102.9. In Staten Island, June broke another record- breaking 100 for the first time ever and hitting 100.2. While still strong, sold-to-list ratio fell to 99.4 in July.
The next few months will an interesting ride around the country when it comes to buying and selling real estate. Buyers seem encouraged by the recent pullback in mortgage rates. But rates have inched higher over the past week, proving to be volatile. Purchases tend to be very rate-driven.
