Data from the New Jersey Association of Realtors for August revealed a slight steady-as-she-goes tally with some softening in closed sales compared to the same time last year. Statewide, sales of single family homes fell from 7,498 in August 2013 to 6,768 in August 2014. New listings for single family homes rose slightly by 2.4% to 10,316 homes while pending sales, those with contracts not yet closed, also reported a slight increase by 1.4% to 6,012.
It appears the median sales price is holding steady as the median price for single family homes dropped slightly from $342,000 to $341,725, a -0.1% fall. Sellers are also getting very near the original asking price as for the month of August, sellers received 96.7% of their original list price. The number of days on market also held relatively steady at 9.6 months, down -3.0% from August of last year.
The condo and townhouse market saw more listing, fewer pending sales and a -15.3% drop in closed sales year-over-year in August while the median sales price dropped from $275,000 to $260,000, a -5.5% drop.
Central Jersey Update
Here in Central Jersey, closed sales have fallen more compared to New Jersey statewide, according to the New Jersey Association of Realtors. While the number of new listings held relatively steady at 335 for the month of August, closed sales fell more than expected by -21.2% to 286 single family homes. The condo and townhouse market also fell by double digits by -18.8%, falling from 154 units in August 2013 to 125 in August of this year. Condos and townhouses have been selling at a brisk pace however, as the number of days on market fell from 64 last August all the way down to 49 while sellers of condos and townhouses received 97.2% of the original list price.
So far this year, there have been 3,434 new listings, a slight increase while closed sales have fallen -15.1%. The median sales price rose to $466,125 for single family homes with sellers getting 96.7% of their original asking price. These figures are year-to-date numbers for 2014 compared with the same period last year.
Mortgage Rate Forecast
Mortgage rates have continued to stay relatively low, this in spite of the eventual end of the Fed’s quantitative easing program, which has been buying mortgage bonds and U.S. Treasuries to the tune of $4.1 trillion since the inception of the program. Since December of last year, the Fed has gradually reduced their buying with the program coming to an end this month.
When the announcement was first made regarding the eventual pullback of the program in mid-2013, both the stock and bond markets reacted negatively with rates moving past the 4.50% mark and the Dow, S&P 500 and NASDAQ falling. Yet mortgage rates have actually fallen well below that mark as the 30 year fixed rate average according to Freddie Mac has been at or below 4.25% since early May.
The minutes from the most recent FOMC meetings were released and in spite of comments from some committee members wanting to raise rates sooner rather than later, the Fed indicated they will be more accommodating to rates and will be somewhat cautious as it considers increasing the Fed Funds and Discount rates. Most economists today think the Fed will stand pat at least until mid-2015 or beyond. This could change however if the job market continues to improve. The unemployment rate for September fell from 6.1% to 5.9% while 248,000 new jobs were created.