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Home Buying | 11 Posts
Home Prices | 4 Posts
Home Sellers | 7 Posts
Smart Homes | 1 Posts
Uncategorized | 1 Posts
March
25

Why the Stock Market Correction Probably Won't Impact Home Values

Why the Stock Market Correction Probably Won't Impact Home Values | MyKCM

With the housing crash of 2006-2008 still visible in the rear-view mirror, many are concerned the current correction in the stock market is a sign that home values are also about to tumble. What's taking place today, however, is nothing like what happened the last time. The S&P 500 did fall by over fifty percent from October 2007 to March 2009, and home values did depreciate in 2007, 2008, and 2009 – but that was because that economic slowdown was mainly caused by a collapsing real estate market and a meltdown in the mortgage market.

This time, the stock market correction is being caused by an outside event (the coronavirus) with no connection to the housing industry. Many experts are saying the current situation is much more reminiscent of the challenges we had when the dot.com crash was immediately followed by 9/11. As an example, David Rosenberg, Chief Economist with Gluskin Sheff + Associates Inc., recently explained:

"What 9/11 has in common with what is happening today is that this shock has also generated fear, angst and anxiety among the general public. People avoided crowds then as they believed another terrorist attack was coming and are acting the same today to avoid getting sick. The same parts of the economy are under pressure ─ airlines, leisure, hospitality, restaurants, entertainment ─ consumer discretionary services in general."

Since the current situation resembles the stock market correction in the early 2000s, let's review what happened to home values during that time.Why the Stock Market Correction Probably Won't Impact Home Values | MyKCM

The S&P dropped 45% between September 2000 and October 2002. Home prices, on the other hand, appreciated nicely at the same time. That stock market correction proved not to have any negative impact on home values.

Bottom Line

If the current situation is more like the markets in the early 2000s versus the markets during the Great Recession, home values should be minimally affected, if at all.  Real estate sales in Ocean County New Jersey are encouraging to both sellers and buyers of real estate.  

February
15

How To List Your Home for the Best Price



If your plan for 2019 includes selling your home, you will want to pay attention to where experts believe home values are headed. According to the latest Home Price Index from CoreLogic, home prices increased by 4.7% over the course of 2018.

The map below shows the results of the latest index by state.

How To List Your Home for the Best Price | MyKCM

Real estate is local. Each state appreciates at different levels. The majority of the country saw at least a 2.0% gain in home values, while some residents in North Dakota and Louisiana may have felt prices slow slightly.

This effect will be short lived. In the same report, CoreLogic forecasts that every state in the Union will experience at least 2.0% appreciation, with the majority of the country gaining at least 4.0%! The prediction for the country comes in at 4.6%. For a median-priced home, that translates to over $14,000 in additional equity next year! (The map below shows the forecast by state.)

How To List Your Home for the Best Price | MyKCM

So, how does this help you list your home for the best price?

Armed with the knowledge of how much experts believe your house will appreciate this year, you will be able to set an appropriate price for your listing from the start. If homes like yours are appreciating at 4.0%, you won't want to list your home for more than that amount!

One of the biggest mistakes homeowners make is pricing their homes too high and reducing the price later when they do not get any offers. This can lead buyers to believe that there may be something wrong with the home, when in fact the price was just too high for the market.

Bottom Line

Pricing your home right from the start is one of the most challenging parts of selling your home. Once you decide to list your house, let's get together to discuss where home values are headed in your area!

We list and sell home in all of Ocean County New Jersey.  Some of the more popular locations we sell homes are in Point Pleasant, Brick, Toms River, Forked River, Beachwood, Berkeley Twp, Bayville, Waretown, Barnegat, Lacey Township, Manahawkin, Tuckerton, Little Egg Harbor and Long Beach Island, New Jersey.

August
3

In today's market, where demand is outpacing supply in many regions of the country, pricing a house is one of the biggest challenges real estate professionals face. Sellers often want to price their home higher than recommended, and many agents go along with the idea to keep their clients happy. However, the best agents realize that telling the homeowner the truth is more important than getting the seller to like them.

 

There is no "later."

Sellers sometimes think, "If the home doesn't sell for this price, I can always lower it later." However, research proves that homes that experience a listing price reduction sit on the market longer, ultimately selling for less than similar homes.
John Knight, recipient of the University Distinguished Faculty Award from the Eberhardt School of Business at the University of the Pacific, actually did research on the cost (in both time and money) to a seller who priced high at the beginning and then lowered the their price. In his article, Listing Price, Time on Market and Ultimate Selling Price published in Real Estate Economics revealed:

"Homes that underwent a price revision sold for less, and the greater the revision, the lower the selling price. Also, the longer the home remains on the market, the lower its ultimate selling price."

Additionally, the "I'll lower the price later" approach can paint a negative image in buyers' minds. Each time a price reduction occurs, buyers can naturally think, "Something must be wrong with that house." Then when a buyer does make an offer, they low-ball the price because they see the seller as "highly motivated." Pricing it right from the start eliminates these challenges.
 
Don't build "negotiation room" into the price.
Many sellers say that they want to price their home high in order to have "negotiation room." But, what this actually does is lower the number of potential buyers that see the house. And we know that limiting demand like this will negatively impact the sales price of the house.
Not sure about this? Think of it this way: when a buyer is looking for a home online (as they are doing more and more often), they put in their desired price range. If your seller is looking to sell their house for $400,000, but lists it at $425,000 to build in "negotiation room," any potential buyers that search in the $350k-$400k range won't even know your listing is available, let alone come see it!
One great way to see this is with the chart below. The higher you price your home over its market value, the less potential buyers will actually see your home when searching.

Price & Visibility | Simplifying The Market

A better strategy would be to price it properly from the beginning and bring in multiple offers. This forces these buyers to compete against each other for the "right" to purchase your house.

Look at it this way: if you only receive one offer, you are set up in an adversarial position against the prospective buyer. If, however, you have multiple offers, you have two or more buyers fighting to please you. Which will result in a better selling situation?

The Price is Right

Great pricing comes down to truly understanding the real estate dynamics in your neighborhood. Let's get together to discuss what is happening in the housing market and how it applies to your home.

You need an agent that will tell you what you need to know rather than what you want to hear.  This will put you in the best possible postion to sell you real property.

Published By Coldwell Banker Riviera Realty with seven real estate offices in Ocean County New Jersey.  Visit our website to see all the real estate listings in two multiple listing services.  Get automatic alerts when new properties come on the market in the MLS. 
  

Real Estate For Sale Listings
 
Homes for sale in Barnegat NJ   

Homes for sale in Bayville NJ

Homes for sale in Point Pleasant NJ

Homes for sale in Toms River NJ 

Homes for sale in Brick NJ

Homes for sale in Jackson NJ

Homes for sale in Mahanhawkin NJ

Homes for sale in Forked River NJ

Homes for sale in Little Egg Harbor NJ 

Homes for sale in Waretown NJ

Homes for sale in Lakewood NJ 

Homes for sale in Ocean Gate NJ

Homes for sale in Beachwood NJ

Waterfront Homes and Real Estate For Sale in Ocean County

 

 

July
30

Ocean County Real Estate Market Performance Update

June 2015

The upward trend of unsold inventory appears is starting to level off while at the same time last year it was still trending upward.  This years contract sales are ahead of last year and the trend line is level.  Lower unsold inventory and non declining sales are is good news for home prices. 

Near the conclusion of June there was a  6.3 month supply of homes to be sold.  That is down from the January high of 8.6 months. 

The indicators appear to show the state of the real estate market in Ocean County New Jersey is improving.  This is of course good news also for home owners who recently purchased. 

Keep in mind that the majority of American's gain wealth from home ownership.  

 

James "Jim" Joeriman
General Manager
Coldwell Banker Riviera Realty, Inc.
 
 
Source of data:  The Otteau Evaluation Group

 

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