Why is NJ one of the hottest real estate markets in America

Estimates show that NJ is currently one of the hottest real estate markets in America, mostly due to the Covid-19 pandemic and incurring changes in tenant needs and lifestyle. Many people have turned to remote work. In addition, due to social distancing, they prefer living in less populated areas. Similarly, due to self-isolation, they like to have an outdoor space they can enjoy without exposing themselves and others to unnecessary risks. Given these changes, the housing unit supply is running low, predominantly in suburban areas, accompanied by a significant increase in property prices daily due to high demand.

New Jersey residents report that this housing demand is unprecedented, even for the NJ housing market which is generally among the popular ones. If we consider that New Jersey is the most densely populated state in the US, the trend we are seeing needs to be observed more closely, especially if buying a property in NJ is of interest to you.

Why do people buy property in New Jersey?

Essentially, the Covid-19 pandemic spurred a substantial shift in the housing market since renters and homebuyers seek to get the most for the money they have. This explains a major turn toward suburban areas, ex-urbs, and smaller towns in NJ. Since most people do not have to commute anymore, the logical step to make their days more bearable is to move to New Jersey areas where they can do their jobs efficiently and work out, take a walk, all the while avoiding crowded places.

Most people are interested in buying a property in upstate New Jersey because they can avoid crowds more easily.

Major trends and reasons why NJ is one of the hottest real estate markets in America

Let's take a look at what may have influenced this rise in demand for NJ property. Real estate agents based in Jersey City have stated that the usual trend of buying a property in popular locations is no longer viable. Nowadays, people are more interested in purchasing a property in the vicinity of different amenities, rather than those close to urban neighborhoods. They want to be close to parks and recreation areas, not crowded streets and shopping streets.

The biggest reason people seek to buy a property with easy access to outdoor spaces is that most people have been working remotely since the Covid-19 pandemic started. Most homebuyers nowadays prioritize moving home to less densely populated areas, where they can walk and exercise after work. This is also true for housing units that have their own backyard. And this is something that NJ housing market has to offer, although this is one of the most populous states.

For the same reason, housing units with a larger number of rooms are also in demand because one of them has to become a home office since most companies have turned mainly to remote working as a safety precaution.

a bird's eye view of a suburban neighborhood in New Jersey

More spacious New Jersey properties have been in demand.

Property values in the NJ real estate market

Homebuyers are forced to change their working and life habits, which is reflected in property values in different real estate markets across the state. Consequently, a pre-Covid-19 modest single-family unit that used to cost around $150,000 could amount to as much as $600,000 in 2020. We will see how the trend will continue in the following year, but it’s probably safe to say that a considerable drop in property prices is not to be expected.

As staggering as this increase is, real estate agents clarify that the updated prices are in no way unrealistic if one considers that NJ is close to New York City and Philadelphia, two large metropolitan areas. Most homebuyers are NYC residents, and they find this price more than acceptable, given the fact that they get a backyard, a private parking lot, high ceilings, and other benefits.

Buying real estate in New Jersey is not so easy any more.

Such high demand for property listings means that, in some cases, there are as many as 100 people that are interested in buying specific properties in NJ. In addition, prospective homebuyers have noted that good deals are scarce due to an influx of more affluent buyers who can make all-cash purchases. It also happens that some properties are sold after a single day of showings, making home purchases an increasingly precarious endeavor for most homebuyers.

If you have been lucky enough to buy a home in one of the hottest real estate markets in America, be sure to plan your move carefully. If your place of residence is further than 100 miles from your NJ property, then it is most prudent if you hire a long-distance moving company. You may want to consider contacting Gibraltar Van Lines to get the moving estimate and let them handle your relocation to ensure it's as stress-free as possible.

The demand balloon and mortgage situation

The usual real estate market drivers in NJ include the vicinity to New York City, generally low rental and purchase rates, and the newly incurred Covid-19 situation. Most financial advisors report that the latter created a bottleneck in NJ this year, resulting in a balloon of demand due to homebuyers who placed their offers from February to May 2020. This has contributed to inflation in property values. However, it is yet to be seen whether this trend will remain consistent in the future.

Suburban neighborhoods in New Jersey have attracted the interest of homebuyers due to the Covid-19 epidemic.

Mortgage loan professionals specializing in single-family properties are definitely prospering in this climate, and those homebuyers who have successfully managed to get a loan and acquire a NJ property can consider themselves lucky. For this reason, planning such a significant financial investment carefully goes a long way. This is also true for people who have already invested in the NJ real estate market and plan to move soon. Hence, if you wish to relocate anywhere in the state hassle-free, some caution, preparation, and planning are advised.

However, some real estate experts voice their concern when they advise their clients who are interested in purchasing a property in NJ, one of the hottest real estate markets in America. Keep in mind that rushing into buying a property in such a competitive market can turn around on homebuyers once the global situation changes. Although investing in real estate is rarely a bad idea, when prices are inflated due the current circumstances, extra attention and careful consideration are necessary.