It is obvious that the Great Recovery has impacted regions in the U.S. unevenly. One local market has had more to deal with than others: the state of New Jersey. The Great Recovery has been anything but Great or Recovery for the Garden State. With slow job growth, high taxes, and the collapse of the real estate market, New Jersey had enough to deal with without having two catastrophic storms hit consecutively: Irene (2011) and Sandy (2012).
Back in 2011, Irene came with the price tag of $1 billion in damage to 200,000 homes and buildings, making it the costliest disaster in the state's history.
Then came Sandy the following year, which brought estimated losses to businesses of up to $30 billion in New Jersey alone.
But this spring, 2015, could present itself as a big pivot for New Jersey’s real estate market.
For the time being, rates are still near record lows and the federal government appears to be cooperating with low down payments care of Freddie and Fanny.
Real estate agents are finding that their offices are buzzing, phones are ringing and there is a lot of optimism in the air. But the business has dramatically changed over the last few years, with some agents finding that the architecture of their sales funnels will be different and in most cases better.
This spring will probably prove to be much better for the following reasons:
- Pent-up demand
- Smart tech makes for smart agents
- Arrival of new buyers
- Real-time apps make follow-up easy
1. Pent-up demand turns into a buying surge?
Over the past few months, there have been a number of very credible articles citing negative metrics, including mortgage apps dropping 3.5% and extensive number of days listings remain on the market.
What the warm weather appears to be carrying with it: some unexpected, pent-up demand and some badly needed inventory, according to a few New Jersey brokers.
“From the beginning of March, our office has seen a significant jump in business and activity for our office in Toms River,” said Robert Cecchini, operating principal at Keller Williams RCI Group in Toms River, New Jersey.
But it isn’t just the thaw in temperature that has some people in New Jersey’s real estate industry all hopped up. For the first six months, it might play out to be the perfect real estate storm of activity due to low interest rates, the low down payments by Freddie and Fannie, and consumer confidence, which, according to the Conference Board, posted a 9.8-point jump to 102.6, the highest since 2007.
Another below-the-line factor is also the steep drop in gas prices, which is creating a mini-economic stimulus touching economies locally.
Considering the record low temperatures for both January and February 2015, the impact should have been much more severe. The average temperature in New Jersey for February could fall below 22 degrees, which would slot it in at fourth place on the state's all-time list of coldest months. In January, the average mean temperature was 27.7 vs 31.2 (Rutgers University).
2. Technology to make New Jersey brokers better prepared
Expertise and engagement
Facebook advertisements: Facebook advertisements are clearly the new ‘must-have tool’ on the block, but social media isn’t replacing the foundational personal referral, it is simply enhancing it.
The new Flex MLS technology: The facts aren’t lying: 85% of all buyers start their purchase process online. The new Flexmls Mobile Web platform will include features designed to make sharing listings to social media easier than ever. Agents will be able to send the current listing(s) (highlighted in yellow) or any listings selected with a checkmark. This is done across both network and mobile platforms. Agents will share, in one click, links to Facebook, Twitter, an external email program or a permalink directly to a public copy of those listings.
Keyword optimization is now local with Google: Local search results, along with thematic clusters, seem to be characterizing Google’s algorithms these days, which allows savvy agents to gain in rankings in their specific region and consequently anchored to the area of the agency. Certainly Monmouth and Ocean Counties are demonstrating some great comebacks, even in the light of the two storms, Irene and Sandy.
Greater control and efficient led funnels: The convergence of digital platforms are enabling agents to execute optimized, integrated, ROI-based, multi-channeled marketing, sales and service campaigns in a 24/7 environment.
3. Emerging demographics: The single millennial as the new buyers
There is a new market segment of homebuyer: the pre-married millennial.
“As individuals are marrying later in life, they are willing to commit to a mortgage, it appears, before committing to a marriage. There are a number of contributing factors to this, according to a recent report published by Redfin,” stated Ralph Aponte, president and founder of Counsellors Title Agency in Toms River.
The report states that over one-third of Americans aged 18 to 34 would rather buy their first home than get married. It is a simple reality test: many millennials are graduating college with big loans and small prospects for jobs. This is further compounded by the cost of getting married today, which is approaching $30,000, which just so happens to represent a down payment.
Certainly the business calls for more intentionality in establishing one’s expertise and professionalism.
4. Real-time broker/buyer instant access
A broker is no longer held to physical face-to-face meetings, but can now give access to view the home virtually via technology to the home, paving the way for the actual inspection. These virtual open house platforms include:
Text-based chatting services
- Google Chat with the video feature
- Facebook chat
- MySpace IM
- AIM or AOL IM
- Yahoo! Messenger
- Viber - Also on the phones is a service called Viber, which allows you to have a video conference right from your mobile smartphone.