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The following market report includes the towns of Caldwell, West Caldwell, North Caldwell, Essex Fells, Roseland, Verona, Cedar Grove, Fairfield, Montclair and Livingston.
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Of the 10 towns in West Essex, only 3 posted year-over-year gains in the sale of fee simple (single-family-detached homes) for the year ending 6/30/2011. Two towns experienced no change.
Looking forward, there were 242 more sales in West Essex than there were active listings at the end of the 2nd quarter, which means that there should be plenty of buyers to go around. Perhaps that’s because there are plenty of good deals in West Essex as median prices continued to fall in 7 of 10 towns. Individual town reports, which are available at www.wessex-homes.com, go deeper into sale price trends.
One area of continued market weakness is $1,000,000+ homes. Of those that do take place, Montclair has the most (43%), followed by Livingston (26%) and North Caldwell (17%). Essex Fells, Cedar Grove and Roseland split the rest.
Fast sales (those that go under contract in 60 or fewer days) are a strong indication of buyer interest in a town, as well as the belief that a deal will be lost to another buyer unless it’s made quickly. In Verona, 65% of sales are fast sales, followed by Livingston at 63%, and Montclair at 61%. At the other end of the scale was Essex Fells, where such sales accounted for only 31% of sales. The biggest reason for fast sales is buyer perception that a deal will be lost to another buyer unless it’s made quickly.
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Another market indicator is the so-called absorption rate. This estimates how long it will take for the market to buy up existing inventories assuming a particular sales rate. At the low end of the time scale is Caldwell, where it will take only 6.5 months. At the high end is Roseland, where it will take 19.3 months to clear the inventory at the end of the second quarter.
Finally, towns can be rated as to whether they favor buyers or sellers. Advanced statistical analysis (Hyperlocal Market Analysis) takes into account multiple factors in order to make this calculation, including the percentage of total listings that sold, the time it took for sales to go under contract and the relationship between sale price and original list price. At the end of the 2nd quarter, the town that represented the best sellers market was Verona. The best buyers market was Fairfield.
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