Happy New Year! It’s time to turn the page, another year has begun. This past year, the Basking Ridge Real Estate Market has seen a dramatic shift - for the better this time around we are happy to report. The year started with the market falling; actually, there wasn’t much of a market as the credit crunch (and fear that the world was ending) seized up the market to a trickle of activity. Slowly with the Spring thaw, buyer activity increased spurred on by low interest rates, falling prices, and inventory to choose from. Summer saw the continuation of buyer demand - houses that were priced well were selling in multiple offers. The pent up buyer demand that has been whispered about in the media had started to come to the front stabilizing house prices in all but the upper end price points. This Fall, spurred on by the first time homeowner tax credit expiring (at the time), entry level homes and 1-2 bedroom townhomes were being gobbled up by people entering the market - hello Generation Y, glad to see you entering the market en masse. Further, the Winter months have continued to show respectable activity.
Where do we go from here? Right back to the double digit yearly appreciation numbers that we had grown accustomed to? Sorry, but NO. Look for the market to remain relatively flat for the next couple of years. After depreciating around 20% from the peak prices in 2005, we should start to see minimal appreciation this coming year and then move forward at about a 3-5% appreciation rate. Unfortunately, interest rates will be on the rise as the housing market rebounds - indirectly suppressing house values (for every 1% of increase in mortgage rates, buyers loose 9% of their buying power). As long as the economy has stabilized, the housing recovery that has begun should continue.
For many, this could be a great time to think about their real estate needs. If you are thinking of upsizing, now is probably the right time to make a move. With interest rates low and the market stabilizing, your biggest bang for the buck is at hand. Also, investors have started to come back into the condo market to take advantage of the drop in prices - is an investment property something you are considering? Know matter what your real estate needs are,
“The Konicek Group” is here to assist you. Give us a call to talk about your Real Estate investments.
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