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Bank Owned Properties for Sale Quashed North Jersey Prices

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By : John Cutts    99 or more times read
Bank owned properties for sale quashed home prices in North Jersey in the final quarter last year, based on data from the National Association of Realtors.

NAR members, such as Maywood real estate professional Vikki Healey, said that the prevalence of foreclosure sales and short sales in the area put a heavy downward pressure on price levels.

In the last quarter, the median sales price for previously owned single-family houses in North Jersey, including the New York metro area, fell to $434,000, a drop of 5.5 percent from the final quarter in 2008. Nationwide, during the same period, home prices dropped by 4.1 percent to a median sales price of $172,900.

Home prices in the final quarter were about $100,000 lower than the peak price of about $540,000 in 2006 and in 2007.

Nevertheless, according to Roseland economist Patrick O’Keefe, sharp price declines may not happen again in the coming months. He predicted that New Jersey home prices will rise in the coming months largely because of slight improvements in the economy.

Total home sales rose in the final quarter, largely because of purchases made by first time home buyers and move-up buyers taking advantage of the federal tax credits. Home prices which were made affordable by bank owned properties for sale were also a big factor for the increase in sales.

A total of 135,600 condo units, single-family homes and co-op units were sold in New Jersey in the final quarter, marking a 34-percent increase from sales in the final quarter of 2008. The sales volume, however, was still below sales levels during the housing boom from 2004 to 2005, when annual sales exceeded 180,000 units.

Real estate broker Healey thinks that the home price decline could be sharper than the 5.5-percent reported by NAR. She believed that prices may have fallen by seven or eight percent. She agreed, nevertheless, that the sales volume in the final quarter of 2009 was far above the sales volume in 2008, when the real estate sector was paralyzed. Healey said that nothing sold in 2008 despite record low mortgage rates and home prices.

These days, according to the New Jersey Association of Realtors, the housing market is showing signs of recovery from the downward price pressure from bank owned properties for sale. Realtor association president Jarrod Grasso said that housing sales will accelerate as job opportunities are created.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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