By DONALD WITTKOWSKI
Sea Isle City’s sizzling housing market is cooling off – a little bit anyway.
The days of the bidding wars for homes and buyers gladly paying more than the asking price during the past two or three years have been replaced with more cautious times, local real estate agents say.
They reacted to newly released data by online real estate giant Zillow that shows Sea Isle’s home prices declined by 1.5 percent from August 2022 to August 2023. The typical home value in Sea Isle dipped from $1.34 million to $1.32 million during that period, according to Zillow.
Realtors say there is no reason for alarm. With prices starting to stabilize or even decline somewhat, they believe now may be a great opportunity to jump into the housing market at the shore.
“It’s a good time to buy right now because sellers are more willing to sell. We just aren’t seeing the bidding wars anymore or properties selling over the asking price,” said Nick Preuhs, an agent with Long & Foster in Sea Isle.
Terese Jones-Anders, an agent with RE/MAX Preferred in Sea Isle, said she has been advising her clients to consider buying their homes now because prices are no longer going “up, up, up.”
“It’s kind of a sweet spot for buyers. They should pull the trigger right now,” she said.
Despite the Zillow data showing a decline from August 2022 to August 2023, Jones-Anders said that prices in Sea Isle are actually stable for homes that are at “normal” levels for the market. The declines are with homes that sellers originally priced artificially high and then had to drop the price to entice buyers, she said.
“I wouldn’t say it’s a true decrease in value,” she said of the market’s overall status.
There are currently 63 homes listed for sale in Sea Isle, including 21 that are new construction. Preuhs noted that anyone who is looking for a new house, in particular, may be able to buy one at an attractive price because homebuilders won’t want to hold on to the properties for long and may be willing to deal.
“If there is a buyer looking for new construction, now is the time,” Preuhs said. “There’s definitely an opportunity for a buyer.”
Rising mortgage rates are a major reason why housing sales are not as hot as before, not just in Sea Isle, but in other markets as well, Preuhs and Jones-Anders explained.
The Federal Reserve has approved a series of interest rate hikes to try to tame inflation. As a result, the interest rates for mortgages have climbed.
“The interest rates are having a negative effect,” Preuhs said of the impact on home sales.
Jones-Anders noted that interest rates are expected to decline in 2024 and 2025 as inflation cools. She said some buyers are taking advantage of adjustable-rate mortgages in anticipation that rates will come down and their home purchases will become more affordable in the next year or two.
Overall, Sea Isle remains one of the top markets in New Jersey for home prices. Sea Isle is among 37 New Jersey municipalities that have typical home prices of at least $1 million, according to nj.com, which cited the Zillow data in a recent story about the state’s housing market.
“The prices are still high. The prices are still good,” Preuhs said of the Sea Isle market overall.
Summer and fall are traditionally slower times of the year for home sales in Sea Isle because owners are renting their houses to vacationers and don’t want to lose that income. Preuhs said that the seasonal factor is likely another reason why Zillow’s figures show a slight decline in Sea Isle home prices from August 2022 to August 2023.
“I wouldn’t call it a complete correction. With interest rates and this time of year, we’re just seeing a slower market. But it will come back,” he predicted.
Global tensions caused by wars in Ukraine and Israel, as well as political instability worldwide, are also putting a damper on the housing market in Sea Isle and the rest of the country, Preuhs pointed out.
“People are just nervous with everything going on overseas,” he said.
Jones-Anders also said that a lot of people “are scared” by the volatile international news they are seeing right now and prefer to wait things out before buying a home.
“There’s a lot of buyers who are doing a wait-and-see because the news is making them nervous,” she said.
