The pandemic has had a big impact on the real estate landscape in New Jersey, upending the market as buyers eager to get out of the city look for houses with more space.
Demand strongly outpaced supply last spring, and homebuyers had to deal with bidding wars that went tens of thousands of dollars over the asking price. Or they lost a home that was snapped up by a faster or more qualified buyer.
As the spring real estate season nears, New Jersey is braced for more unusual trends for buyers and sellers.
“The spring 2021 market is expected to be very busy and active, and similar to 2020 in that buyer demand is still very high, inventory is very low and home loan interest rates are exceedingly low,” said Katie Severance, a Realtor with Brown Harris Stevens in Montclair.
Severance, who is also the author of “The Brilliant Home Buyer: 101 Tips for Buying a Home in the New Economy,” shared her tips and her forecast for the spring and summer, which towns are hot right now and what COVID will mean for the market in the months to come.
Q: We saw huge demand and little supply as people wanted to get out of cities or move to less crowded areas to have more space because of COVID. What will the spring look like? Has the trend changed through the winter?
KS: It appears that the spring market 2021 — February through June — will have at least the same level of demand as last year and possibly even higher demand. Buyers are still leaving the city. And there continues to be very little inventory on the market; especially right now due to both winter and COVID, and perhaps even due to the uncertainty that always comes with a change in presidential administrations. Add to that the fact that interest rates remain shockingly low. So right now, correctly priced homes on the market are selling very swiftly — and many of them in bidding wars. And that will continue for at least the next several months.
Q: With COVID, lots of people have purchased homes sight unseen, or just on video. What should people do in these situations?
KS: It is not recommended to buy any home sight unseen but if it must be done, walk through it virtually via FaceTime with your Realtor. Don’t rely on a pre-produced video. They are produced to show only the best parts of the home.
Or send a trusted friend or family member to see the house for you. And send a trusted friend, family member, or better yet, a contractor, on the inspection.
Get a copy of the Seller’s Disclosure form if the seller has filled one out. New Jersey is one of the states that does not require it, but many sellers fill one out anyway. This gives the buyer an idea of what parts of the home may have past or present problems or material defects.
Evaluate as many comparable homes or “comps” online with the help of a Realtor to try and establish value and the right amount to offer — without overpaying.
Q: Have you been seeing bidding wars or a lot of offers on homes like we saw in the late spring and summer last…