Real Estate Market Update in Commuter Towns in NJ
South Orange, Maplewood, Millburn, Short Hills, Summit, Chatham Boro, Livingston, Montclair, Glen Ridge
The real estate market update in commuter friendly towns in NJ for the first seven months of 2016 is quite interesting for its lack of consistency. Some towns, which had huge price increases in 2015 have slowed down, Livingston actually declined in average sale prices and some are flat (see analysis below).
Why so inconsistent? While these communities are located so close to each other, there are major differences between them. For instance, two out of the ten towns are enjoying double digit price increases – Chatham Boro (within the larger Chatham Township) and South Orange.
What accounts for them still experiencing such high demand? They could not be more different from each other. As of the 2010 census data, the racial make up of Chatham Boro is 91.13% white, .99% (less than 1%) African American and 4.85% Asian. Contrast that with South Orange whose racial make is 60.16% white, 28.66% African American and 5.16% Asian.
Chatham has become quite popular because the high school gets consistently high rankings by the media. In fact, in many, it is ranked the #1 in the state for academics (see the 2016 top high schools report for towns along the Midtown Direct train line here). This contrasts with South Orange’s high school (regional high school including Maplewood) which places # 60 in the top rankings.
The average price for a home in the two towns is also a huge contrast. Chatham is extremely expensive with an average sale price of $857,197 and South Orange is $669,070 – a difference of 28%. If I were to generalize, I would say that the Millenials who are buying their first home in both towns have very different profiles. South Orange attracts more “hipsters” and Chatham more “Preppies.”
The two important attributes they have in common are direct commutes to NYC and walkable downtowns, which are two of the Millenial’s highest ranking parameters for purchasing a home. While some of the other towns have these same amenities – their prices may have topped out earlier.
The over arching real estate market update in commuter friendly towns in NJ is that regardless of income, and background, Millenials are driving the real estate market and will continue to do so for some time since more of them are coming of age. Having a wide array of communities where they can all feel at home should continue to bode well for housing prices in our area.
Jan – July 2016
Avg. Sale Price 2016
Avg. Sale Price 2015