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