There's no doubt that real estate markets tend to conform to the calendar. Bergen County residents experience all four meteorological seasons, and its real estate market also follows expected patterns (with more activity in the spring and summer).
Going into 2023, you may wonder what market conditions will prevail in the long term. Certain market factors appear and disappear seemingly at whim. In this time of economic uncertainty, when is the best time to purchase a new home or put yours up for sale?
The Ann + Melinda Group
has the answers. Here’s what you need to know about the Bergen County real estate market in 2023.
What is the state of today’s Bergen County Real Estate market?
Anyone would agree that 2022 was a turbulent year for the general U.S. housing market. If the pandemic-influenced heights of 2020 and 2021 were outliers, the market soon corrected itself with a nationwide slowdown. When explaining that behavior, most experts cite three economic factors: high inflation, high interest rates (or mortgage rates), and high sales prices. In Bergen County, however, buyer hesitation over increasing rates was a short-lived phenomenon, and prices still continue to climb in our area.
Of those three factors, only sales prices are in your control. What about sales volume? Last year, Bergen County saw a 35% or more annual decrease
in new listings, pending sales, and closed sales. This is driven by a severe housing inventory shortage, which is keeping prices on the rise.
What do Economists Say About the 2023 Real Estate Market?
Most professionals agree on three expected market behaviors:
Sales volume will continue to slow or remain stagnant at best
Luxury sellers might have to lower their asking prices as that segment gains inventory
Buyer demand will outpace supply
To what degree will these macroeconomic trends affect the Bergen County real estate market? Intriguingly, more significant price declines are expected in more expensive areas. Local buyers may face a dilemma — more buyers will be able to afford luxury asking prices, but interest rates will dent their purchasing power.
It’s a common misconception that high mortgage rates only affect buyers. Many recent homeowners bought their homes at very favorable rates. If you are in that boat, you can wait until market conditions improve before going to market.
When is the Best Time to Sell?
Photo courtesy of The Ann + Melinda Group
We are still experiencing a seller’s market in Bergen County. Inventory is relatively low, and because winter is the slow season for sales, your home will stand out should you decide to list it now or in the near future.
Alternatively, you can wait until spring or early summer and list with confidence — especially if you have a good home for families. Public schools in Bergen County don’t resume sessions until the beginning of September. As a rule of thumb, families moving to the area like to move into their new homes before September 1.
As a seller, you want to market your property in a way that convinces buyers to act. Agents like ours at The Ann + Melinda Group
know which techniques reach the most buyers and lead to the most offers.
Who are the Potential Buyers?
Anyone selling Bergen County real estate can gain a massive advantage by knowing their buyer target groups (pay special attention if you are considering selling a single-family home).
According to recent research by the National Association of Realtors (NAR), millennials
, who number over 80 million, make up the most significant percentage of homebuyers (43%) in the United States. As the largest percentage of homebuyers in any generation, this group — once nicknamed the “renter generation” — is determining the next phase of the housing market simply by their sheer numbers and goal to become homeowners.
In their ambition to own homes, millennials are as intelligent and adaptable as any generation before them. As such, it is safe to assume they are crucial in maintaining the housing market as it stands now. Given that many of them are looking for a property to purchase, your home could be a perfect fit!
How Will Mortgage Rates Affect Buyers?
The market's reaction to rising inflation has been a dramatic increase in mortgage rates this year. The Fed raised the interest rates throughout 2022 in response to rampant inflation. The high mortgage rates we see today reflect high-interest rates and economic uncertainties nationwide.
As of January 2023, the average rate
on a 30-year fixed mortgage was 6.36% — still a function of rapid inflation. These are the highest levels mortgage rates have reached in almost 20 years. What’s more, they doubled in the past year, an event that had never occurred in housing market history.
Buyers on the fringes of today’s market may subscribe to two schools of thought. The sooner you buy, the sooner you can build equity in the home. On the other hand, unhurried buyers are in a position to wait for more favorable conditions. There are positives to either approach; a quality agent from The Ann + Melinda Group can help you weigh market conditions against your circumstances.
Variations in Bergen County Home Prices
Photo courtesy of The Ann + Melinda Group
Home prices are highly relevant to your prospects, whether you're selling or buying. Experts are divided on the topic of home prices in 2023. Nearly every market is in a slowdown, but some recently experienced rapid increases at their peak. One theory suggests those markets will falter this year.
In Bergen County, there is cause for cautious optimism. The single-family median sales price for December 2022 reached $627,000 — an 8% increase
from a year prior. That all Bergen County homes averaged over $767,000
indicates healthy activity at the top of the market. If you’re buying or selling luxury homes in Bergen County, the question is how supply and demand will affect the market for these high-end properties.
Now that you know more about the Bergen County real estate market, you may be on a path to buying or selling property in the area. The expert Ridgewood real estate agents
at The Ann + Melinda Group are ready to join you. We bring 30+ years of combined experience to each day, and our testimonials speak for themselves. Our agents understand what it takes to succeed in Bergen County’s housing market, regardless of local trends. Reach out to the experts today at The Ann + Melinda Group
*Header photo courtesy of The Ann + Melinda Group