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Home » The Competition is Fierce, No Doubt About It

The Competition is Fierce, No Doubt About It

June 10, 2020

I’ve been saying, “The sky is NOT falling,” for months. Now, I’m going to go a step further and say, “This is the strongest Seller’s Market we have had in Bergen County in a long, long time.”

Talk to any professional real estate agent in Northern New Jersey and they will tell you they are crazy busy. Their buyers are losing multiple houses in bidding wars. Houses are selling over asking price in a matter of days, sometimes hours. Loan officers are jammed up too – first with the re-fi boom, and now with new purchases.

There are still plenty of folks who do not believe the tales of stiff competition and multiple offers. We’ve got buyers who are still sitting on the sidelines waiting for prices to drop. But the proof, as always, is in the numbers.

Last week, our accepted offers were 3% HIGHER than last year (data provided by the New Jersey Multiple Listing Service, www.NJMLS.com.) And we are STILL IN LOCKDOWN!

This chart shows the week over week numbers comparing this year to last year:

The COVID-19 and Bergen County's Real Estate Market I Residential Properties (Single Family, Condos & Coops, 2-4 Family) First two numbers for each date range are New Listings (2020 compared to 2019), next two numbers for each date range are Accepted Offers (2020 compared to 2019). 03/23-03/29 119 389 116 354 03/30-04/05 115 486 95 357 04/06-04/12 104 505 109 374 04/13-04/19 133 283 97 317 04/20-04/26 142 389 130 303 04/27-05/03 195 552 166 348 05/04-05/10 261 414 201 379 05/11-05/17 275 481 238 363 05/18-05/24 339 342 331 365 05/25-05/31 289 380 285 297 06/01-06/07 434 420 367 347

You can see that in the early days of quarantine, the numbers dropped like rocks. Since that first month, however, they have risen steadily.

Some of those super-negative predictive models have turned out to be wrong, too. For example, unemployment stats were a big surprise this week. And as we said in our last blog (and this chart shows), unemployment has no correlation to the housing market:

Chart with the heading: Unemployment Rates and Home Sales Do Not Have a Direct Relationship. Shows that at one point, when unemployment was 7.5%, Existing Home Sales were 3 million; when unemployment was 6%, home sales were over 5 million; when unemployment was 9.6%, home sales were over 4 million (there is also a box which says "#3: Lending standards also tightened significantly after the housing crash"), and when unemployment was a bit more than 4%, home sales were over 5 million

All of the emotional reasons for buying a home – safety, security – remain the same. And as a result of the pandemic, we’re seeing people coming from densely populated adjacent areas who want more for their families now. Couple this with ridiculously low interest rates, and you can understand why Bergen County is ON FIRE – metaphorically speaking.

To those who refuse to accept this reality and seem unfazed by alternate opinions, I say, “Wake up, people!” Look at the facts – the sales that are happening right now – and forget all the hoopla and the drama. (Do yourself a big favor and turn off the nightly news – I promise you’ll feel better.)

I may be going out on a limb here, but not only is it NOT going to get easier to buy a home in Bergen County anytime soon – it will get MORE competitive and the prices will rise. No doubt about it.

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