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The Passaic County housing market closed strong in the fourth quarter of 2015, with solid increases in both sales and prices. As a result, Passaic finished its third straight year of meaningful price appreciation, clearly indicating that it is moving into a seller’s market.
Sales. Passaic sales continued to go up in the fourth quarter, rising almost 7% and finishing the year with a 13% increase off 2014 levels. Indeed, we’ve now seen sustained increases in buyer demand for over four years, with quarterly sales up in 17 out of the last 19 quarters. Moreover, the almost 3,000 sales for all of 2015 marked the highest calendar year total since 2006, at the height of the last seller’s market.
Prices. Although prices bounced around a little in 2015, they finished the year strong. In the fourth quarter, prices were up almost 5% on both the average and at the median. And even with the ups and downs throughout the year, Passaic still finished 2015 with a solid 2.1% increase in the average and 3.1% at the median, marking the third straight year of modest, but meaningful, price appreciation. Prices still have a long way to go to recover from the market correction of 2008-09, but they are moving in the right direction.
Negotiability. The negotiability indicators were mixed. The days-on-market were slightly up for both the quarter and the year, signaling that it was taking longer for homes to get sold. But the listing retention rate was also up, indicating that sellers were gaining some negotiating leverage with buyers, and were better able to command closer to their asking prices. As buyer demand continues to heat up, we would expect sellers to gain more negotiating power, leading to higher prices overall.
Going forward, we believe that Passaic’s fundamentals are sound, with homes priced at relatively attractive levels, rates near historic lows, and a stable economy. Accordingly, we expect that Passaic County will flower into a fully-realized seller’s market in 2016, marked by continued increases in both sales and prices.
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