Market Conditions in Edison>Question Details

sara, Home Buyer in 08816

how long will the home prices continue to decline in newjersey ?when will it start to rise?

Asked by sara, 08816 Tue Apr 22, 2008

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Real estate is local but also interconnected. e.g. Danny just bought a condo at Edison Hollow South http://raspberryct.blogspot.com/ in cash before it was sold out. I asked him why? he said he just came back from visiting his sister in CA and same type of condo there with same rent is about $500,000 there. So, he think investing a condo in Edison NJ is a great investment.

I wasn't quite sure what he was talking about, but one thing I know is that Danny already bought 5 condos for investment in Edison IN CASH! Ok, he said his father prohibit all his families to buy any stock or securities; his father said it was a gamble, look at Bear Stern was $170 then $2 sold (may be more, but if you own Bear Stern, you cried no tears as Danny think)

Anyway, I went to Berkeley recently to eyewitness by myself and document everything I found out here http://berkeleyhousing.blogspot.com/

If I am going to buy a $500,000 condo at Berkeley for my son's 4 year study there, I would rather rent one at $1,500 and buy 2 condos here in Edison. With the same amount, for 2br 2ba condo here, I can get $3,200 a month, why buy there at Berkeley?

So, real estate is local, but it also interconnected with many other places as well.
1 vote Thank Flag Link Thu May 1, 2008
really interesting article mary. in 50s the man was making 10K and bought house for 13K (i.e. 1.3 times income.:)
then in 1971 he was making 50K and bought house for 33K (i.e. .66 times income:)

no wonder house prices were guaranteed to go up then.

now if you are lucky IT guy working in new york earning 100K you buy house for 500K (i.e. 5 times income:(

on top of that yesterday only I got good news that my company is slashing salaries by 10% accross the board :(. and my friends who lost jobs in IT are getting new offers 30% lower.
0 votes Thank Flag Link Fri Feb 20, 2009
Statistically, New Jersey has not been following the national trend. Our home prices have decreased, but not as substantially as the rest of the country. Remember, we are right next door to the largest city in the world, therefore, the old adage rings true...Location, Location, Location!!! I don't have a crystal ball either, but I do know that demand will be picking up in NJ as the weather gets nicer and Spring arrives. More desirable homes will be coming on the market and people that HAVE to move will start looking to avoid pulling children out of school at an inconvenient time. That's my prediction!
0 votes Thank Flag Link Fri Feb 20, 2009
0 votes Thank Flag Link Fri Feb 20, 2009
If you look at Victor's answer from May to your question from April, then they still won't start to rise anytime soon.

Interesting that all these answers thave time traveled from Now back to
April and May. Or are the answers now just the same ones given back then? Confusing......I don't know when they will go up or stop going down, but now is the best time to buy. Does not compute, Will Robinson, does not compute.......
0 votes Thank Flag Link Sun Feb 8, 2009
In Middlesex County, the average Sold price for single family in January increased almost 7% from December 08.
Is it the beginning of a trend reversal? Time will tell...

Cathy C-
0 votes Thank Flag Link Sun Feb 8, 2009
cheng,

2bedrom condo rent at edison hollow is around 1400 - 1650 range not $3,200.
0 votes Thank Flag Link Fri Nov 21, 2008
other than the answer I am about to give, all others are wrong...
I have no crystal ball and am using no hands either... lol...

The prices will stop declining when demand for homes becomes greater... The laws of supply and demand are directly related to price.

Home prices will begin to rise when... Supply is less than the demand for the product, in this case homes... Unless of course you have the one home on the block that everyone can afford and absolutely MUST HAVE.... (Excuse the Sarcasm)

http://www.realrep.com
0 votes Thank Flag Link Thu May 15, 2008
I have seen some very good advise here and am happy to see someone else that also refers to Jeff Otteau. Based upon the information I receive from his reports we may see the bottom in mid 2009 - but no one knows for sure. There are many variables to consider. All real estate is local. You must speak with a local realtor that knows how to use statistics from the multiple listing service to show you the market trends for your area.
0 votes Thank Flag Link Wed Apr 30, 2008
please excuse the typos in the last post...obviously I didn't proof read it too well
0 votes Thank Flag Link Wed Apr 30, 2008
I have a few comments. No one knows for sure, there are so many factors involved which were already mentioned. This is a fairly normal cycle in real estate, and the time to "recover" has always varied based on the numerous factor s already mentioned. Please, if you are looking for real estate information, it is still much wiser to get current and accurate information from a realtor who has access to true sale prices, and can monitor trends using the MLS statistics. Additrionally, when a property was listed, how long it was on the market before a contract was signed and WHEN it was signed (seasonal differences still occurr in this market), the condition of the property, the sellers motivation to sell are all other factors that influence sale prices. A responsible realtor will have visited many of the comparative properties to get first hand knowledge of it's condition and location, and proper pricing (for both buyer and seller) in the current market. Some people here, although their intentions are very good, are not privy to as much information as realtors, and I would advise you to take everything they say with a grain of salt.
0 votes Thank Flag Link Wed Apr 30, 2008
I agree with a lot of others that nobody knows the answer.
Dr Cheng's answer really cracked me up.
As far as I know, there is a tight correlation between home prices and Job Creation/Salary Raises/Credit Availability
His answer seems to imply that our salaries and total job creation and credit availability are tightly couple to gas prices. I for sure know my salary is not coupled with gas prices but my mortgage spending power for sure is coupled with gas prices in an inverse fashion, which doesn't bode well for home prices
0 votes Thank Flag Link Sat Apr 26, 2008
In fact, the home prices in some prime locations such at Greater Edison Area near NYC train station already start rising... e.g. Centerplace at Edison next to Middlesex County College jump 20% after their first phase sold out on their 2nd phase.

Also gas price will signal inflation and building cost will inevitably goes up so are price. e.g. when gas price was 80 cents back 90's a 2br 2ba condo costed $80,000 and that's about 100,000 gallons of gas to trade for. Now the gas price went up to $3.50 per gallon, a fair price of 2br 2ba condo in Greater Edison area would be $350,000 (i.e. 100,000 x $3.50)...

It is a matter of US Dollar depreciation, that's why you see around 500 homes sold in Piscataway in 2007 and 1,000 homes sold in Edison in 2007, you will see many other towns start selling well since many people sold their condo/townhouse will move up to buy bigger home, and even several $1.3m houses sold recently in Edison ...
0 votes Thank Flag Link Sat Apr 26, 2008
A lot of people ask me this question. The answer is, we can speculate, but no one knows for sure.

I've started throwing my Realtor trade magazines away without even reading them. I can't take another "Rah-rah Real Estate" article declaring the slump over anymore, so when you see a news item or read a newspaper article, note the background of the person dissemninating the information. Their bias could make that information suspect.

All I know is what I'm experiencing lately and I've posted the following response to another similar thread on this website:

"I've seen evidence in my market that things may be turning around. Last year at this time, nothing seemed to be moving off the shelves at all. The buyers I'm working with at the moment had fourty listings to pick from three weeks ago. Twenty of those listings have now gone to contract. The reason these buyers want to own instead of rent? They don't want to live in someone else's house. These people are first-time buyers.

The most common feedback I got from buyers last year after touring my listings was that they liked the houses, but haven't sold their starter house yet to be able to bump up; therefore, they're not ready to make an offer. It's the starter homes that I'm seeing moving the most now. In my opinion, this will trickle up. Once a seller gets a contract on their starter house, they can bump up to a larger one.

I do not follow economics and the most I know about the stock market is how my 401K balance keeps dropping, but after having some difficulty getting my buyers into homes to view before they go to contract, my gut tells me we may be starting to turn around.

We won't know when we've hit bottom until the prices either start to climb, and once that happens there'll be a lot of people who sat on the fence a little too long saying "woulda, coulda, shoulda."
0 votes Thank Flag Link Fri Apr 25, 2008
Jeffrey Otteau who is fairly well respected in the field mentions 2014 before prices could reach the highs we were at a couple of years ago. There are so many factors ie. who will win the Presidency and how will the federal reserve handle interest rates ? Will foreign money come in and bail us out. the US dollar is so weak that there is a potential of major investing in the US. Right now we have low interest rates but we also have high foreclosure rates. Dont forget to look at NJ economy as this state has terrible taxes and is just about driving business out. I doubt there will be any news of improvement until we see major changes both state and federally.
0 votes Thank Flag Link Wed Apr 23, 2008
Just remember we are in the best position in the entire country due to the fact that we are so close to NY. Now in reponse to your question, please note that real estate in New Jersey is a local to the market you are looking in. To best answer your question you need to see your local market. If you are Selling, you need to know whats the inventory in the marketplace and how long is it taking to sell properties. If you sell and buy, where are you buying is it a better buying condition there then you are ahead of the game.
Thanks
Munish
0 votes Thank Flag Link Wed Apr 23, 2008
That's the big crystal ball question. Just remember- if we have not reached bottom, it will take just as long to come back to current prices as it did for the prices to fall. In other words, it could take 3-5 years for today's prices to return after the bottom is hit. Then who knows what interest rates will look like.
0 votes Thank Flag Link Tue Apr 22, 2008
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