Buyers Prepare: Condo Market Softening in Downtown Jersey City
October 23, 2018 | Dwell JC
Although average prices have not yet been affected, the steady increase in days on the market signals a weakening in the condo market that favors buyers. The average number of days on the market (DOM) has continued to increase over last quarter and last year. The number of days on the market in the downtown area for this period was 41 days. This is up 20.5% over last quarter and up 57.7% over last year. Although average prices have continued to rise, the chart below shows a steady increase in DOM, which signals a weakening in the condo market and a shift that favors buyers.
The property tax reval and other changes in property tax code may be possible causes; however, an abundance of inventory may be what ultimately triggers condo prices to tumble. Apartment construction in Jersey City, especially downtown, is at an all-time high. At this time the City has well over 37,000 units in the pipeline and more than 9,000 currently under construction. In the last year alone, Jersey Digs has reported dozens of new, major developments with thousands of additional units planned.
This building boom will contribute to a huge over-supply of new apartments, especially in downtown Jersey City, which will mean that prospective buyers will have many more choices. Although it appears many of these units will be rentals, an over-supply of housing options will have an impact. Since the condo market is already slowing and the incoming over-supply is inevitably going to soften it further, condos will spend increasingly more time on the market, giving buyers a wider range of choices and more negotiating power.
This softening market won’t last forever — it never does! — but as it continues to drift toward a buyer’s market, it is the perfect time for those who have been waiting for an opportunity to buy their first home or make an investment in real estate.
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Please feel free to contact me with any questions about current market conditions.
This report was prepared by Tom Gibbons, a licensed Real Estate Agent and Realtor-Associate with Warren G Curtin Realty, Inc. Email at firstname.lastname@example.org or call/text at 917.593.4836.