8 Signs of Rising NJ Real Estate Home Values
What to consider regarding NJ real estate home values
When the NJ real estate bubble burst in 2007 and the number of foreclosures began to rise, some areas began to look like ghost towns. Abandoned homes and vacant buildings were common sights to see almost everywhere. And, if you live in an area that was hit hard by the crash, you may be wondering what your home is worth now as well as what it might be worth in the future. Fortunately, the signs to determine when your neighborhood will start seeing an upswing after an economic recession can be easily seen. Begin by taking note of the areas that suffered most during the recession for improvements. Numerous purchases made by investors and first-time home buyers are good indicators. Also, an increase in the sales of new construction homes as compared to discounted foreclosed properties, as better sales will lead to an increase in housing construction. The improved availability of credit, indicated by banks lending to home buyers, further suggests that the recovery is likely to last. Below are 8 indicators that will help you to stay informed regarding what is going on in your area:
- Housing Market Index
- Affordability Index
- New Residential Construction Index
- Existing Homes Sales
- Mortgage Rates
- Purchase Application Index
- New Residential Sales Index
- U.S. Foreclosure Index
The National Association of Home Builders produces the Housing Market Index, which is weighted and adjusted seasonally. It provides ratings for present single-family sales and single family sales in the next 6 month period of time, determined on a scale of "good," "fair," and "poor." Another part of the index is known as "buyer traffic," measured on scale of "high," "average," and "low," allowing an NJ real estate buyer to get a sense of the demand for new houses.
The Affordability Index is released by the National Association of Realtors, and it provides statistics regarding whether a typical family could qualify for a mortgage loan on a typical NJ real estate home. A "typical family" earns the median family income as indicated by the U.S. Census Bureau. A low index means that housing is not affordable, and a higher index means housing is more affordable.
The New Residential Construction Index, created by the U.S. Census Bureau is made up of two surveys: the survey of construction and the building permits survey. The survey of construction reports estimates of housing starts and completions on a monthly basis. The building permits survey takes into account the amount of permits distributed for new housing units monthly from random permit offices.
Existing Homes Sales is considered "the premier measurement of the residential real estate market," according to the National Association of Realtors. This report gives the monthly statistics on sales and prices of existing single-family homes, including condos and co-ops, for the nation and the four regions; Northeast, Midwest, South and West. This indicator provides general information regarding the real estate market and can be applied for forecasting procedures.
Freddie Mac gathers data on a weekly basis for mortgage rates in its Primary Mortgage Market Survey, asking U.S. lenders the rates and points for their most popular 30-year fixed-rate, 15-year fixed-rate, 5/1 hybrid amortizing adjustable-rate, and one-year amortizing adjustable-rate mortgage products. This survey is considered a trustworthy method in determining the credit procedures of financial institutions.
The Purchase Application Index is provided weekly by the Mortgage Bankers Association, an indication of individuals’ confidence regarding their financial standing and ability to buy an NJ real estate home. The advantage of this is that it provides a "ripple effect" because an increase in loan applications helps promote more construction jobs, therefore bringing in revenue for homebuilders, lenders, and home furnishing companies.
The U.S. Census Bureau provides data about the New Residential Sales Index on a monthly basis based on a sample of houses selected from building permits. A sale is considered the deposit taken or sales agreement that was signed.
The website Foreclosures.com reports the number of formal notices filed against a property during the foreclosure process for its U.S. Foreclosure Index.
The real estate market is changing rapidly and expanding into new avenues almost daily. Sometimes it can be very difficult to find the answers you need on a specific topic or issue. In times like these, you need a real estate professional who will provide valuable information and trustworthy advice. For more information on NJ real estate, call us today or click here to be connected with one of our top real estate specialists.
