The number of homes sold fell in the South Jersey Shore real estate market last month, according to the latest Long & Foster Real Estate Market Minute report. In Atlantic County, home sales decreased by 20 percent and Cape May County saw an 8 percent decline. Atlantic County exhibited a rise in median sale price with an increase of 13 percent. Active inventory fell slightly in both counties.
In the last months of 2018, real estate industry experts were predicting rising mortgage rates for this year. Instead they’ve remained low, causing many to revise their projections.
“There are two things that motivate people when it comes to interest rates,” said Gary Scott, president of Long & Foster Real Estate. “One is low interest rates rising, and the other is trending upward decline. Back when mortgage rates were 3.25 percent and trending downward, people were holding off on buying because they thought rates were going to go under 3. The minute they rose to 3.5 people jumped to lock in their rate.”
“The stock market has also leveled to some degree, and the more that stabilizes the better off we’ll be,” Scott said.
Lately, industry headlines have been touting increasing inventory of homes for sale, but Scott warns that they don’t tell the whole story. When broken down by geographic area or price point, consumers may see a very different picture.
“Inventory is up, but that’s not true for every part of the country and much of the new inventory is priced at the higher end of the market,” Scott said. “Every area has its own unique factors, which is why it’s so critical to work with a hyperlocal expert who can help peel back the layers of information.”
He said while builders want to create more entry-level housing they’re in a difficult spot.
“We all know we need to deliver new housing at an affordable level, but the cost of land, the cost of labor and the cost of supplies are a problem,” Scott said. “Those variables we don’t have control over are putting us in a place where building lower cost homes is hard to do.”