The housing market in New Jersey seems to be on the upswing. January had the strongest start of a year since 2007 and many in the industry are optimistic for the future. New Jersey Builders Association Treasurer and K. Hovnanian Homes Vice President Dave Fisher told NJ Today Managing Editor Mike Schneider that he was surprised by the latest numbers but encouraged by them.
“It’s good news for the housing industry and it’s good to see that more homes are being sold in New Jersey, permits are being issued. So it’s an encouraging number,” Fisher said.
While new construction resulting from Hurricane Sandy damage hasn’t picked up tremendously, Fisher said there has been some new activity on that front. “I think compared to last January, which is what it’s gauged against, we’ve seen more activity in the start of this year in part because financing remains available although lending requirements are tough, interest rates are low and consumer confidence is up a bit from the prior year,” he said. “Most of it I think reflects a good portion of multifamily housing in central and northeastern New Jersey.”
Over the past decade, Fisher said there has been a transition to more housing concentrated in areas that are well developed in parts of central and northern New Jersey and along the coast. He said more multifamily housing is being used because of the needs of younger buyers and because zoning for traditional larger lot single family homes is not as available as it used to be. He said there are a variety of reasons for the lack of availability, including that the land is already developed or land is being protected or preserved for environmental reasons.
Fisher said his company is doing well, seeing a pickup in buyer interest in “well located communities.” He said K. Hovnanian Homes is building quite a bit in central and northeastern New Jersey as well as eastern Pennsylvania. “We’ve seen more activity, some sales increases and price increases in well located projects,” he said.
While Fisher said most of the communities hardest hit by Hurricane Sandy are anxious to get residents back into their homes as quickly as possible, he anticipates the impact won’t be seen right away.
“There are some impediments and obviously conditions depend on whether the homeowner had insurance or not, how badly their house was damaged and whether they intend to or need to completely rebuild as opposed to elevate their house,” Fisher said. “Much of that hasn’t begun and I think we’re going to see more economic activity as a result of the hurricane over a prolonged period of time, several years at least.”
A report released earlier this year found that more residents moved out of New Jersey in 2012 than any other state. When asked if he has had trouble selling homes to people outside of the state, Fisher said his company’s primary market is the New York/Philadelphia area.
“People who live here like to live here. I think most people see the benefits of being in a state like New Jersey — close to all of the employment that is here, the cultural, the agricultural, the opportunities that we have in New Jersey which is so diverse,” Fisher said. “But it is an expensive state and I think that someone coming here from another part of the country where costs are much lower may have a difficult time getting used to the cost of housing, which is why we continue to see eastern Pennsylvania as still a reasonably good housing market.”