J.K., this is a dangerous question to ask when most of the people answering have a vested interest in you buying an overpriced home. Knowing what I know about the true cost of a home per sq ft., and the fact that N.J. is not immune to the issues of the housing market or the elements that caused it's fall such as over priced housing units, rising gas prices, and increased food cost, I would have to say that those units are overprices. Look, I found this in an article on NJ.com last month that reflected the number in janurary:
"Meanwhile, New Jersey ranked 18th in the nation, with 5,113 properties in default or having been re possessed. That's 57 percent more than the previous month (December 2007), but 15 percent less than January 2007." Actually, since the problems with housing started, the numbers are really over 13,000 homes have already been repossessed, 7,921 are scheduled for auction or have been auctioned, and 136,835 are in pre-foreclosure right now! You know how those of "local concern" down play any news that hurts their bottom line.
However, this tells me three things. 1) Things are getting bad in N.J., 2) It is only beginning, and 3) being 18th out of 50 for something negative is not good at all . This may be interpreted as good news somehow (I don't know how), or it could be explained away by saying that those numbers are from the "sub-prime" sector or "section of town". But the truth is that almost every home in America is overpriced due to over speculation in the investment marketplace of real estate mortgage paper. Right now Essex has 18, 800 pre-foreclosuers; nearly 2,500 forelcosures; and 919 properties scheduled for auction. Sussex is a little better with only 3,493 pre-foreclosures; 350 foreclosed; and 277 scheduled for auction. Bergen has 7,456 pre-foreclosures, 479 foreclosures, and 361 scheduled for auction. I could go on and on but you should get the picture by now.
The choice is yours and I'm sure if you decide to buy there will be plenty of Realtors willing to assist you in your purchase. And If your financial situation is really strong enough to overcome all of the economic issues, and you are not concerned with depreciation or loss of equity, then you should buy what you like. But you may check into some of those distressed properties, you may get a great deal on one of them.
I hope I was able to help you.