Why Jersey’s foreclosure crisis is cause for celebration to some

Foreclosures are at a 11-year high across the state

New York Weekend Edition /
Mar.March 04, 2018 09:00 AM

(Credit from left: Taber Andrew Bain, 401(K) 2012)

The New Jersey housing market marches to the beat of its own drum.

As foreclosures nationally hit an all-time low, New Jersey’s housing market is seeing repossessed homes reach a 11-year high. Of the state’s total housing supply, nearly 2 percent of homes were in foreclosure in 2017 and, between November and December last year, the number of homes owned by the bank went from 1,448 to 2,308, according to the Wall Street Journal.

Part of the reason is the state’s system of “judicial” foreclosure, which means repossession of a home must wind its way through the court system — a process that can take years — so homes that went into foreclosure after the financial crash in Jersey are only now making it to the market.

“The pig is now finally at the end of the snake,” said the New Jersey Bankers Association’s Michael Affuso to the Journal. “We had the extraordinary slowness of foreclosures occurring at the judiciary, and that problem has reasonably resolved itself.”

New Jersey’s housing market is increasing low on supply, so buyers are welcoming a spate of new properties and many see the uptick in foreclosures as an investment opportunity.

“There’s a lot of experienced investors who are buying [bank-owned homes] and some new people are buying them believing they are going to be investors,” New Jersey Realtors’ Christian Schlueter to the Journal. He pointed to one recent repossessed home which received eight offers in just three days and closed over the asking price, despite being a fixer-upper that would need extensive renovations.

Most investors are converting the bank-owned homes into rentals for former homeowners who lost their houses. [WSJ]Erin Hudson


Related Articles

arrow_forward_ios
From left: PropTech's Thomas Hennessy and Joseph Beck; Appreciate's Chris Laurence (Appreciate, LinkedIn/Tom Hennessy, LinkedIn/Joseph Beck, iStock)
Single-family rental platform Appreciate to go public in SPAC deal
Single-family rental platform Appreciate to go public in SPAC deal
Seth Boyden Court in Newark NJ with Great Point Studios CEO Robert Halmi (Loopnet, Great Point Studios, iStock)
Film studio to replace vacant public housing in Newark
Film studio to replace vacant public housing in Newark
From left: Douglas Elliman's Scott Durkin, Stephen Kotler and Avi Dan-Goor (Douglas Elliman, iStock)
Douglas Elliman bets on Vegas in westward expansion
Douglas Elliman bets on Vegas in westward expansion
366 State Street and 37 Sidney Place in Brooklyn (Corcoran, Zillow)
Passive house asking $15M tops Brooklyn contracts
Passive house asking $15M tops Brooklyn contracts
100 Eleventh Avenue (iStock, Rhododendrites/CC BY-SA 4.0, via Wikimedia Commons, Illustration by Kevin Cifuentes for The Real Deal)
Lower-end listings dominate Manhattan’s luxury deals
Lower-end listings dominate Manhattan’s luxury deals
Wildfire, Houses
One in five homes facing wildfire risk, report says
One in five homes facing wildfire risk, report says
(Top) 1580 Meadow Lane in Southampton NY and (Bottom) 2056 Montauk Highway in Amagansett NY (Zillow)
A tale of two oceanfront Hamptons homes
A tale of two oceanfront Hamptons homes
More and more homebuyers and investors are coming to the negotiating table with cash in hand. (iStock)
In cities, “starter homes” getting more difficult to find
In cities, “starter homes” getting more difficult to find
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...