Why home sales are booming in NJ despite pandemic

Pending home sales in New Jersey outpaced last June by more than 30%, a clear indication the housing market is returning to normal levels.

Pent-up demand through COVID-19 lockdown likely pushed normal spring activity into the summer.

New Jersey Realtors President Angela Sicoli said she believes the big boom in pending home sales is two-fold: The sellers are getting a higher price for their homes and the buyers, even though they are paying a bit more, are tempted by the historically low mortgage interest rates.

Inventory remains tight with just 34,480 homes for sale in June, so the level of wanting becomes even more desirable, Sicoli said.

The 30-year mortgage interest rate is historically low at 3.01% and the 15-year interest rate is at 2.54%. Sicoli said that shows a grow in demand and will continue to be a record low for mortgages, according to the Federal Home Loan Mortgage Corporation, also known as Freddie Mac.

Pending home sales rose 33.8% over last June, placing New Jersey far ahead of expectations, data show. Sicoli also said May 2020 had 10,237 pending sales.

Closed sales are still below average but the gap is narrowing. There were 8,967 closed sales in June, a nearly 22% decrease from June 2019. The median sales price for all properties is up 8.5% this year. New listings are on track with 16,954 in June, less than 1% off last June.

Sicoli believes the house selling season will continue to be robust in summer, through the fall and possibly through the end of the year.

She said the big draw for New Jersey is the scores of people migrating from New York City and other areas. They are looking for single-family homes with backyards. Bergen and Essex counties are prime location spots because of their close proximity to Manhattan, where people still have their jobs.