On the hunt for a home last summer, Priscilla Gabela and her husband, Antonio Aluotto, gave up after a month. Bidding wars were everywhere, and the North Arlington couple decided to wait things out, taking a break from September through December.
When they reentered the market early this year, they were in for sticker shock. If prices were too lofty in 2020, this year they zoomed into the stratosphere.
“It’s been crazy,” Gabela said. “We’ve seen a lot of houses priced really high.”
Welcome to the post-pandemic North Jersey real estate market, where price appreciation is the brutal reality even with vaccines spreading, interest rates climbing and more homes going on sale. With demand still high, last year’s “COVID premium” isn’t fading away.
In Bergen County, the median home sale price in Tenafly jumped 16% this May compared with a year earlier. Hackensack’s rose 19%, and Teaneck saw a whopping 33%, according to data from the state realtors’ association and individual agencies.
Some axioms of North Jersey housing held true: Towns with quaint, walkable downtowns or easy access to NJ Transit fared well — Montclair prices leaped 22%.
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But some of the sharpest increases occurred farther to the west, as the trend toward hybrid and online work schedules encouraged buyers to settle farther from New York. Morris County’s median price surged by $100,000, or 23%, in April, the latest month available. Sussex County soared as well, led by Sparta’s 23% increase.
“Sellers are taking advantage of escalating prices and buyers are feverishly absorbing the inventory — it’s still very much a seller’s market,” said Max Stokes, a real estate associate at Christie’s International Real Estate Northern New Jersey in Ho-Ho-Kus.
Hunting for a home
Gabela and Alutto, both 36, have been looking for a four-bedroom, two-bath Colonial under $900,000 in northern Bergen County — Upper Saddle River, Allendale and Wyckoff have been the main hunting grounds.
They’ve stood in long lines at open houses but found that even homes that need work are commanding high prices. One dated property in Allendale was selling for $900,000. While the pandemic’s decline means more houses have hit the market this year as compared with last, there are also more buyers, real estate agents said.
Gabela knows they will pay more for the same house now after putting their search on hold. But she also expects to get more for her North Arlington home, which she plans to list at $430,000 once the couple buy a property. An agent priced the home at $350,000 last year, based on an analysis of similar homes.
“It’s a wash,” Gabela said.
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Median sales prices jumped 14% in Bergen County this April, compared with a year earlier; 19% in Passaic County and 21% in Essex.
The market faces a major test in the coming months, as companies start asking employees to return to work, said Stokes, the Ho-Ho-Kus real estate agent. For now, Bergen County homes continue to sell quickly, with competition at every price point, he said.
Although the market ground to a halt when the pandemic erupted in March 2020, it recovered quickly with a momentum that has carried through into this year. Statewide, home sales were up 20% for January through April, compared with the same period in 2020. New Jersey’s median home price rose from $335,000 to $407,000, up 21.5%.
The market’s new reality is “multiple offers, shorter days on the market, more cash deals and higher prices,” said Noemi Morales Barile of Coldwell Banker Realty in Alpine and Closter. Buyers are waiving inspections; bidding wars are common.
“I’ve seen $400,000 homes sell for $75,000 over asking price; I’ve seen $3 million homes sell for almost a million over asking price,” added Greg Rice, a Coldwell Banker agent in Spring Lake, in Monmouth County.
More space for your money
The virus pushed city dwellers to seek out more space in the suburbs, and buyers have been looking for more value by heading west, said Jeff Fellers, a real estate associate at KL Sotheby’s International Realty in Mendham. Towns in Morris County offer more room for the dollar, and with remote and hybrid working models an option, an extra 15 minutes for the commute doesn’t seem so bad two to three times a week, he said.
Towns with strong downtowns and direct train access to the city have been fairing well, a result of city dwellers moving out, said Rich Stanton of Stanton Company in Montclair.
Buyers also like the small-town, walkable charm of Morris County towns like Denville, said Ilene Horowitz, a real estate agent at Coldwell Banker Mountain Lakes.
Lake communities such as White Meadow Lake in Rockaway Township are also seeing more demand from transplants like Meredith and Nick Huddy, who bought into the neighborhood in April. They were moving from Arlington, Virginia, with a new baby in March and found that homes were selling as soon as they were listed.
So Meredith, 32, leaped into action when she saw a three-bedroom Colonial with a two-car garage that she liked online. The family drove to New Jersey the next day for a viewing and immediately made an offer. Competition was fierce: The Huddys had to bid $21,000 over the $439,000 price.
“It was the first house we saw, and we knew we had to make the move right now,” Meredith said. “We knew the market was hot. We didn’t know how crazy it was.”
Mary Chao 趙 慶 華 covers the Asian community and real estate for NorthJersey.com. To get unlimited access to the latest news out of North Jersey, please subscribe or activate your digital account today.
Email: mchao@northjersey.com
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