October 2, 2013 at 12:20 PM
MILLBURN, NJ - Sellers continue to hold the cards in the local real estate market in Millburn and Short Hills, as well as in many of the surrounding towns. The latest data shows a sustained upward trend for home prices in the area. The average sale price of homes in Millburn, sold between January and August of this year, was $1,325,201. That is up 10.5% from $1,198,841 during the same time period in 2012.
During 2012, homes in Millburn were selling, on average, at 108% of their total tax assessment (the assessment value of homes determined by the township on October 1, 2008). The 44 homes that closed sales during August of 2013 sold at approximately 125% of their total tax assessment, higher than the 117% average ratio for the entire year indicating a willingness by buyers to pay premium prices.
It is also taking sellers less time to sell their homes. The amount of time required to place a home under contract continued to decline. Homes sold in August averaged 25 days on the market (DOM); the lowest number seen in many years. The average number of DOM in 2012 was 56. Since August closings largely reflect homes that went under contract during the spring season, the data suggests that homes sold twice as fast during the spring than they did the year before.
Demand for homes remains strong. However, the supply of homes is down from a year ago, further favoring sellers. In August, there were approximately 20% fewer homes on the market than during the same month in 2012. Overall, however, sales have increased. Between January and August 2013, approximately 240 homes were sold in Millburn. This reflects a dramatic increase of 30% compared to the same eight-month period in 2012, when only 182 homes were sold.
For potential buyers, 2013 has been marked with significant frustration. Eager to buy while interest rates remain low, they are faced with fewer homes to choose from, rising prices and competition from other buyers. According to Simon Westfall-Kwong, Sales Associate for Re-max Village Square Realtors in Short Hills, “The market has remained strong. This strength is fostered by the lack of inventory on the market. There aren’t enough homes for buyers who want to buy.” Given the data and the laws of supply and demand, it would be hard to imagine a better poker hand for sellers than today’s real estate market.
Shannon Aronson is a local real estate expert and REALTOR® with Keller Williams Realty Premier Properties. She can be reached at www.ShannonAronsonRealEstateTeam.com or by email at Shannon@ShannonAronson.com. She is also a licensee with The Alternative Press.