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NJ Real Estate Watch: 2022 Home Price Forecast

Minimal inventory and low interest rates kept housing prices high in New Jersey throughout 2021. Many prospective home buyers have one question: have home prices peaked?

On Behalf of Veitengruber Law | Mar 09,2022

 

Minimal inventory and low interest rates kept housing prices high in New Jersey throughout 2021. Many prospective home buyers have one question: have home prices peaked? That question is difficult to answer. While it does depend on your area, in general, real estate experts do expect NJ real estate prices to continue to rise ever so slightly in 2022. Here are three factors contributing to housing prices in the garden state this year.

1.   Housing Stock Remains Low

While the demand for homes in NJ hit a pandemic high in July 2021, it has progressively decreased since. That being said, single-family and townhome properties remain low in stock. This means that even though demand is significantly less than it was prior to the pandemic, the buyers browsing the market will have fewer options. Lower stock can encourage sellers to ask for top dollar. Buyers can even anticipate bidding wars, although not to the extent that we saw in 2021.

2.    Home Values Increase—But Not Drastically

In 2020, home values increased 12%. In 2021, home values increased 15%. And while values are still expected to go up in 2022, experts only expect about a 5% increase. This will create a more stable market with more predictable trends. Homebuyers can expect prices to remain relatively stable throughout 2022. This is good news for buyers with a set budget.

3.   Expect a Sale Over Asking Price

By the end of 2021, the trend of ten bids in one day on one property had died down. Sellers can now expect a handful of offers over a few days or weeks. Homes are still selling for over asking price, but more in the range of 2-5% instead of the gigantic margins we saw last spring. Buyers should expect to pay the list price at the very least, and likely more than the list price if they are looking to quickly secure a sales contract.

The bottom line? New Jersey home prices will likely continue to rise in 2022—but not significantly. We won’t see the meteoric rise in home prices that we saw in early 2021, but home buyers should still be prepared for a solid seller's market with higher than normal home prices. Still, it can certainly be said that this market has plenty to offer buyers who know what they are looking for and are ready to move quickly. Sellers, on the other hand, should take the time to work with an experienced real estate agent in order to land on a listing price that is just right.

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