New Jersey Housing Market Underwent Seismic Shift During COVID-19
Coldwell Banker Realty Agents Share How Pandemic Shaped Home Buyer Priorities
More than a year past the onset of COVID-19 and with hope of a full return to normalcy on the horizon, the pandemic is still influencing home buyer and seller decisions. The unprecedented events of 2020 caused a shift in the priorities for home buyers and sellers throughout New Jersey, as well as forcing real estate agents to adapt how they serve these clients. Coldwell Banker Realty agents recently shared how COVID-19 shaped the local real estate market in ways that continue to surpass expectations.
“For the first time in recent memory, many buyers have been able to choose homes based solely on the lifestyle they desire,” said Rob Norman, president of Coldwell Banker Realty in New Jersey and Rockland County, New York. “With fewer workers tethered to a central location, it’s been possible to broaden their search and attain more home for their dollar. The irony of lockdown is that it ended up creating more freedom in living situations.”
“Since the onset of the pandemic, you see many buyers looking for homes with the perfect floor plan for daily living,” said Karen Peters of Coldwell Banker Realty in Wayne. “They want extra space with private offices and a finished basement to accommodate everyone that is working and schooling virtually.” Among the biggest trends are swimming pools and spacious yards, said Peters. Entertainment space such as large living rooms, home theaters and gyms are popular amenities.
Greg Rice, of Coldwell Banker Realty in Spring Lake, said this is a reversal, as smaller homes that required less maintenance and had downtown walkability used to be the rage. He added, “One of the biggest trends I’ve seen is that riverfront/bayfront properties, which had been a depressed market since Hurricane Sandy hit in 2013, have now come roaring back. They bay and the ocean have offered boaters a self-controlled freedom in a world where everything on land is constrained.”
According to the National Association of Realtors’ (NAR) “2020 Profile of Home Buyers and Sellers,” buyers were more likely to purchase a home that could fit multiple generations of their family during COVID-19 than before, by a 4% increase to 15%. Peters said she’s seen families move in older generations to keep them safe. And in homes where both parents are working, extended family “helps with maintaining the house and, more importantly, raising the children.” First-floor accommodations are a strong consideration in these homes.
NAR found that the primary reason people sold their existing homes during the pandemic was because they wanted more living space. Amy Paternite of Coldwell Banker Realty in Maplewood agrees with this completely. “Many of my clients have been coming from Brooklyn/New York City and the Jersey City/Hoboken area. They are ‘over’ vertical living, not keen on cramming into an elevator and going home to their 500-square-foot apartment.” Paternite said she has also noticed an urgency among buyers to take advantage of historically low interest rates.
While the real estate market ground to a halt in March due to COVID-19 lockdown, it quickly recovered with momentum that has continued from spring 2020 into the present. NAR reported that existing home sales in the northeast during March 2021 were 16.9% greater than in March 2020.
“We have a sellers’ market with very low inventory,” said Frank D. Isoldi of the Coldwell Banker Realty Westfield East office. “Well-priced homes are selling very fast, many with multiple offers.”
Noemi Morales Barile of the Coldwell Banker Realty Alpine/Closter office and the Hudson Valley Regional Sales Center Office in New City, New York said the new normal is “multiple offers, shorter days on the market, more cash deals and higher prices.”
“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,” said Rice.
New Jersey REALTORS® recently reported that the median sale price for a single-family home in the state was $406,000 in March, a 22.1% increase over the previous year, the month in 2020 when lockdowns took hold. The median sale price for townhomes and condos was $311,000, a 13.1% increase over March 2021. Meanwhile, inventory for both property types stood at two months, with six months of housing inventory generally considered a balanced market.
“Like everyone else, real estate agents have fine-tuned their virtual game,” said Isoldi. “Virtual walkthroughs became a staple. Showings are pretty much back to normal now with proper safety.” The safety measures real estate agents instituted during the pandemic included face coverings, social distancing and proper hand hygiene per Centers for Disease Control and Prevention guidelines.
“I sold a house in April of last year without ever leaving my house,” said Morales Barile. “I selected three homes for a set of buyers; they drove past and selected two to see. I arranged access with the sellers, and the buyers picked one of the houses. It closed and they are now enjoying their new home. When there is a will…”
Paternite recently managed to safely squeeze 72 showings across four days at a listing while the buyers were out of town and received multiple offers. “I’ve also sold a few homes where the buyers didn’t step foot inside until closing day,” said Paternite. She utilized FaceTime during the house-hunting process and home inspection, and the buyers closed via power of attorney. “Modern technology was definitely a plus.”
“Buying or selling a home requires an incredible amount of communication. Even with the technology at our disposal, it is important now more than ever to enlist a real estate agent who knows the area and can effectively represent you in such a major transaction,” said Norman. As highlighted by NAR in their “2020 Profile of Home Buyers and Sellers,” 88% of buyers surveyed recently purchased their home through a real estate agent or broker.