Everyday we read stories in the newspapers and watch reports on television and online about how housing prices are plummeting and folks are being forced to lower the sale price of their homes to respectable levels in order to sell. Unless, of course, you live in certain areas of New Jersey. The New Jersey Real Estate Report blog had an excellent post about this the other day. From the article which is reprinted in their post:

New York-White Plains-Wayne, N.Y.-N.J., was the nation’s least affordable major housing market for the second consecutive quarter. In the New York market, 10.6 percent of the new and existing homes sold during the third quarter were affordable to those earning the area’s median family income of $63,000.

You get that, folks? If you live up in the Wayne area of New Jersey then only 10% of the homes being sold are affordable for those making $63,000. In other words, you need to make $63,000 per year in order to afford only 10% of the homes that are currently for sale in this part of the real estate market. I have a sneaking suspicion that this data holds true the further west and south that you go in New Jersey at least through western Morris County and northern Ocean County.

What’s the end result of this mess? Simply enough - it’s the continued existence of a large inventory of homes for sale on the market throughout most of New Jersey. The sellers are a varied bunch. Yes, you have some greedy people who refuse to sell their real estate without making an exorbitant return for this market (15% - 24% above their purchase price). My landlord is a great example of this greed. A townhouse in the same development as I currently live in is on the market for $250,000. It’s the same exact three bedroom, two and a half bath townhouse that I currently live in, just down the street. Yet my landlord is only willing to sell the place that I currently live in for $315,000. No budging on that price, either (believe me, I tried). Greed like this is destroying the real estate market in New Jersey.

Yet on the other hand there are a lot of people who are in over their heads and are now stuck with mortgages that exceed the market value of their home. These folks could not be expected to sell their real estate without covering their existing debt, but at the same time a buyer cannot be expected to purchase a piece of real estate for more than its market value. What are strapped sellers and eager buyers to do?

Most realtors are still harping on their mantra of their industry - “Now is the time to buy.” You’ll hear this from most realtors no matter what the market conditions. One great thing about the New Jersey Real Estate Report is that they provide comparison busters for their readers. In other words, your realtor will provide you with comparisons to show why the price on a home is in line with the market. It is, of course, in their best interests to show you comparisons that are generally in line with what the seller is asking (higher is better). Why is higher better? Simple - the higher the home price then, usually, the higher the commission the realtor makes on the deal.

If you’re out there looking for a new home, I’d suggest checking out the New Jersey Real Estate Report so you can at least get the truth about the market where you are shopping.

In the mean time, check out Jersey City Locksmith for the best locksmith service in the Garden State!

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This entry was posted on Thursday, November 20th, 2008 at 12:34 am and is filed under Money, Jobs, & Finances, The State of New Jersey. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.