Home Prices are UP in North Jersey, Especially Along NYC Train Lines

Softer Landing

State's housing market is surviving slump better than rest of the country
Thursday, August 16, 2007

BY SAM ALIStar-Ledger Staff

Nationally, the median price of an existing single-family home declined 1.5 percent. In the New York metropolitan area, which includes North Jersey, prices were up 1.7 percent.

So, why are real estate brokers like Pat Hoferkamp, president of Parsippany-based Burgdorff ERA, smiling?

"Last year was the third best year in Burgdorff's history in terms of homes sold and, quite honestly, I feel very good about this market," Hoferkamp said. "Things are happening. People are buying homes. We've got busy open houses. I expect to do what we did last year, if not increase our business."

SPLIT PERSONALITY

Is Hoferkamp talking about the same New Jersey housing market?

The answer is yes and no.

That's because when it comes to real estate, New Jersey has a split personality.

Talk to real estate agents who sell homes along the state's commuter rail lines -- where 12 of Burgdorff's 14 offices are located -- and the news is all good.

Talk to agents anywhere else, and, well, the news is predictably glum.

But in towns like South Orange, Summit, Montclair and Morristown, which are along the main branch of New Jersey Transit's Morris and Essex line, it's another story.

For example, Montclair has just a three-month supply of unsold homes on the market, according to Otteau. Chatham, only two months.

The number of homes contracted for sale in prime markets in Bergen, Essex, Hudson, Middlesex, Monmouth, Morris, Somerset and Union counties declined by only 1.7 percent from May to June, compared to 5 percent statewide, Otteau said.

Most notable in this group are places like Jersey City and Hoboken in Hudson County, where year-to-date sales activity is running 12 percent ahead of last year, he said.

Looking ahead, Otteau expects this trend will only accelerate, with communities near direct-to-Manhattan rail lines seeing the strongest price increases once the market recovers.

The primary reason is job growth: Employment in Manhattan is expected to grow from 2.7 million to almost 3 million over the next two decades -- with over half of this growth in Midtown, according to a NJ Transit study.

"Once again, Manhattan is king as it relates to the New Jersey housing market," Otteau said. "That is what will drive our housing market going forward."

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