We’re more than halfway through 2019, and if trends stay consistent, it’s going to be a strong year in Avalon and Stone Harbor real estate—as well as nationwide.
Across the country, sellers and buyers saw a flourishing market bolstered by steadily declining mortgage rates. While it was predicted that mortgage rates would continue to climb, as they had done through most of 2018, by the end of June private lender Freddie Mac reported an average 30 year fixed mortgage rate of just 3.73%—down from 4.55% at the same time the year prior.
This is good news for buyers all over, but especially on Seven Mile Island, where many buyers are financing second homes and investment properties. Other national trends that have been impacting the real estate market in Avalon and Stone Harbor include rising homeownership rates (currently, 64% of Americans own homes, a number that’s been increasing at a stable rate since 2015), and an inventory shortage that’s keeping sellers’ position strong.
Of course, things work a bit differently on the New Jersey coast. In an area where the inventory is driven in large part by vacation homes, the ebb and flow of the market doesn’t always match up with what you see happening elsewhere. And yet, for the most part, we’re seeing many of the same trends that are being witnessed throughout the nation, including rising sale prices and more competition for listed properties.
For a full understanding of the housing market in Avalon and Stone Harbor, take a look at the key takeaways below from our May 2019 Market Minutes housing report.
More Units Are Being Sold
As expected, Seven Mile Island real estate saw a spike in units sold throughout the spring. May’s numbers were down from the market’s peak in April, but the month’s total units sold was still higher than this time last year. 46 units sold this May in Avalon and Stone Harbor—about a 30% increase from May 2018. And it was just in time too, since homeowner’s who purchased properties in May were able to have them up and running for the summer season.
Active Inventory Went Down—But It Hasn’t Slowed the Market
Just as we saw throughout the country, sellers have been more reluctant to list their homes. Part of this may be due to the rising desirability and investment potential of Avalon and Stone Harbor properties, as well as homeowners who have refinanced with the lower mortgage rates and want to hold steady for a little while. Versus last year, active inventory was down by 3%, or six units, for a total inventory of 222 homes for sale. With more homes being sold though, the slight lack of available properties means more competition for buyers, and more leverage for sellers.
Homes Are Moving More Quickly
May 2019 saw homes spending an average of 157 days on the market—a decrease of 7% from May of last year, when they spent an average of 169 days on the market. While spending two weeks less as an active listing might not seem like much, this trend is indicative of the market as a whole. More buyers looking for more homes—and fewer homes available for them to choose from—means that it’s necessary to act fast.
Sale Prices Are Soaring…
What do you get when you combine low inventory with high demand? Rising sale prices. And in Avalon and Stone Harbor, sellers are getting way more bang for their buck than they did at this time last year. This May, the median sale price for homes in the area was $1,622,500, a nearly 94% increase from the median sale price this time last year of $837,500. Even with May’s sale prices coming in slightly lower than the spring market peak in April, sellers are consistently getting a major return on their investments, and the trend shows no sign of turning around any time soon.
…And Buyers Are Willing to Pay
In a flourishing seller’s market like what we have on Seven Mile Island, buyers don’t have a ton of wiggle room when it comes to getting their dream homes. The average sale price in May was 96.5% of the average list price, an increase of 1.7% from this time last year. With so much competition for properties, buyers know that they have to come in with an impactful offer if they want to go under contract.
Whether you’re on the buying or selling end of the Avalon and Stone Harbor real estate markets, there’s never been a better time to make your move. Buyers can enjoy low mortgage rates, while sellers have the benefit of a high demand that shows no signs of slowing down. If you’re ready to act, get in touch with our team at the RJ Soens Group today!