Update 07/17/2025: NJ Prices Surge as Inflation Bites—What Buyers & Sellers Need to Know Now

New Jersey’s real estate market is defying national trends—again. In this week’s episode of The Pulse and Perspective, host Pete D’Angelo dives into scorching home prices across the state, including a jaw-dropping 31.7% jump in Newark, even as inventory rises. Are these gains sustainable?

We break down the hyper-local dynamics driving unexpected growth in places like Union County and Jersey City, while other areas like Englewood begin to soften. Pete also unpacks the updated New Jersey Mansion Tax rules—and shares a clever negotiation tactic buyers can use right now.

Then we zoom out to the national level: inflation is running hot again, and mortgage rates are climbing in response. Pete explains why the Fed’s interest rate policy may be fueling inflation instead of cooling it—and what this means for buyers, sellers, and agents heading into the heart of summer.

👉 Whether you're in the market or watching from the sidelines, this episode offers the timely perspective you need to stay ahead. #HousingMarket #MortgageRates #NewJerseyRealEstate #InflationWatch #FedRate #HomePrices #RealEstateUpdate #RealtorTips #ShelterInflation #MarketTrends

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Peter D'Angelo | NMLS: 885309 | Branch Manager | Guaranteed Rate, Inc., NMLS 2611
Peter.DAngelo@Rate.com

*All information, topics, discussion is my own personal opinion and insight, not reflective of Guaranteed Rate, Inc. May contain market information for informational purposes only, not to be used as financial advice.

Transcript

Podcast_Update_07.17.2025

​[00:00:00] 

Welcome back to the Pulse and perspective with me, your host, Pete D'Angelo, with your weekly market update. First, we're going to take a look at New Jersey. There's quite a bit that's been happening and there's some important data to know because there's a little bit of a dissonance right now. When we watch national news and hear headlines and what's actually happening here in the state of New Jersey with respect to real estate.

So starting things off, here's some key statistics that I'd like to share today. The market is sizzling. We are seeing that the median single family home sale price in the state of New Jersey is about $600,000. That is up 7.1% year over year, and that outpaces the National Median Home sale price by 6.2%.

There's our first piece of evidence that New Jersey's obviously operating quite a bit differently than the rest of the country right [00:01:00] now. The inventory's also up 19.3%, year over year, more opportunity, more homes are available and they are still moving fast. Right now, New Jersey ranks number fourth, nationally with the median time on market, days on market for a listing at 37 days on market.

So let's take a look at some spotlight regions that I wanted to highlight that are showing us the variety of the markets in the state of New Jersey, and that from north to south, there's quite a bit that's still happening here in Livingston.

These are now average. Home sale prices. So the average gets a little bit more hairy because the average, we're adding it all up and dividing by the number of homes that were sold. So the outliers get weighted into that average, and that could give us a little bit of a higher representation.

So grain of salt required here, but we're gonna start off with Livingston. Average home sale price, $1.28 million. That's up 6.3%. [00:02:00] Englewood, New Jersey. Average home sale price, $820,000. That's down 10%. In Union County, we're seeing average home sale price at fifty five, five hundred and fifty $5,000. That's up 5.7%, and then Jersey City is seeing a modest gain, but the average there is $694,000 average home sale price in Newark, New Jersey.

We see the average up to $499,000. That's representing a 31.7% increase. That's a tremendous urban price growth. So taking all of these things into account and looking at the state, yeah, we have some pockets that are softening a little bit, but a lot of these other markets and some surprises here are still seeing price.

Gains with higher inventory, with there being more opportunity for buyers, prices are still elevated. This is an indication of that pent up buyer demand that [00:03:00] has persisted for now years at this point, and it looks like it's going to persist because the cost of financing has been elevated 

referencing back over, you know, let's say the past 10 to 15 years, it's been higher. So that's been a obstacle for people wanting to purchase. Especially first time home buyers that have to get very aggressive and very competitive in this market. So those prices are still going up, but there's certain regional areas, even in the state of New Jersey where things are starting to soften a little bit.

So what does this translate to? Well, this really means that it's hyper-local right now, just as we looked at the national and how we are stacking up in the state of New Jersey compared to the national numbers. It's hyperlocal well within that, it's still hyperlocal within our state. So even though statewide we're still seeing resilience on prices, there may be a little bit longer days on market.

You know, 37 days on market on average is a bit longer [00:04:00] than we've been seeing over the past couple years. The prices are still going up for homes, there's still home value appreciation occurring. But in some markets that's not happening. I gave you one example here today, but that just goes to show that this market in the state of New Jersey is even hyper-local.

So always be prepared to really lean on your real estate professional to get the granular insights in the areas that you're interested in purchasing. If you are a prospective home buyer and if you're a prospective home seller, it's a good time to get engaged with a local real estate professional to find out.

Hmm, maybe now. Maybe this is good timing. There's quite a bit of inventory. The quality of inventory still runs the gamut. So if you have a desirable home in a desirable area, maybe having a conversation now, even if you don't wanna list now, could still help. 'cause it'll provide you with a reference point.

And then when you are ready to list, you will have an idea of what to expect. I wanna also revisit today the [00:05:00] New Jersey Mansion Tax Changes. So we talked about that a couple weeks ago. I want to clarify this and also hammer the point home with a couple points of interest and possibly, some ideas for, this one's really for our real estate professionals out there.

So New Jersey Mansion Tax changed originally 1% is the Mansion tax for a buyer to pay when they're purchasing a home, a million dollars and up that has now changed. 1% is still applicable. But it's paid by the seller, and now there's additional price brackets with different mansion tax rates, so 1 million to 2 million.

It's 1% paid by the seller. Then when you go to 2 million to two and a half million, that's two and a half. I'm sorry, two and a half million to 3 million. That's two point a half percent. 3 million to three and a half million. That's 3% and three and a half million and up. That's three point 5%.

And how that three and a half percent operates when you're at three and a half and [00:06:00] up, that extra half a percent is applied to the amount that's sold above the three point a half million dollar mark. So it's three and a half doesn't get applied to the full three and a half million dollar price tag. It gets attached to anything above three and a half.

That's where that extra half a percent comes in. Now I did a post and I got some great feedback, on my social media talking about this. 'cause I had an idea. I'm like, let's, let's make this a positive, right? Let's look at the glass being half full. Obviously changes to a real estate market. While things have been crazy stinks, we've got enough on our plate.

In the real estate industry and in the mortgage industry, trying to manage client expectations and trying to manage, everything properly for the families that we serve. Well, this is a curve ball that gets thrown in here. 'cause now there's different expectations that need to be set. So with that in mind, here's my little nugget of wisdom.

Even though this change has occurred and the responsibility to pay the mansion, tax falls on the seller. [00:07:00] If you are a buyer in this price point, it could be a beneficial negotiation point or term of your offer. When you're placing your offer to the seller. I'm placing my offer at $1.5 million and I'm gonna pick up that mansion tax of 1%, and you put that in the offer.

Your offer could be a little bit more appealing now, because you are offering to help the seller out with something that was a recent change. Not only is it maybe a gesture of goodwill, but also it could make your offer stand out. And right now we've gotta pull every lever we can so that our clients and the families that we help can be competitive in this market.

So this is one thing that I think could be beneficial and from the feedback that I've received from real estate professionals in this market. Very positive feedback. So this could be a good way to help you negotiating. 

Yes, inventory's on their eyes, but price prices are still up and there's a ton of pent up demand. You can make it [00:08:00] so that you will only entertain offers that will take care of that. Now, the legality of doing something like that and how to do that, you're gonna want to talk to your real estate professional, but you know, you can keep that in mind.

Or put language in to say that you're encouraging the buyer's contribution to the Mansion tax. And now I mentioned about paying the full Mansion tax. Maybe you just say, Hey, I'm gonna come in and meet you 50 50. 'cause now you know, when you sell that house, if these laws remain the same, you're going to end up having to shoulder the burden of that cost too.

So this transition period. It's tough, but it's manageable and here's a little nugget so that possibly you can make your offer stand out and give yourself a little bit more of a chance when you're bidding on those homes.

Okay. With the real estate information taken care of. Now we're going to get into mortgage rates, that inflation report, talk about the near term and some tips for you as we proceed and wrap up today's episode. Starting off mortgage interest rates have been on the incline this week. Mortgage rates have been responding to some lower [00:09:00] expectations for fed rate cuts due to the inflation report.

So on bearing the lead, we're gonna get there. But for right now, 30 year fixed rate mortgage averaging anywhere between 6.75 and 6.9%. As of today, the 30 year refi rate has softened a little bit. We see that closer to 6.9% kind of flattened out. Rates are continuing to hover in this margin as it's shifted upward.

This is going to be the case for the near term. Unfortunately, as we're going to be clearing through the middle of the summer, we're gonna have a little bit of a higher rate environment for the foreseeable future. Any headline can change this, but this is the situation now as it stands, inflation, this is the main primary driver to why we see the interest rates a little bit higher.

We talk in the past a lot, and I'll reiterate this. Mortgage rates are not 100% based upon what the current circumstances are. They are. Speculative, they're part of the market. They are based on market indicators that are [00:10:00] speculative. So it's not about what's happening in the here and now. It's about what the expectations are for what's going to happen.

And what we see in an inflation report, it's a little hotter, is a lower likelihood of the Federal Reserve lowering their interest rate. If that expectation is removed, now interest rates go up, and that's the case right here and now. The Consumer Price Index was released this week, one of the inflation reports that we talk about on a monthly basis, and here's what it looks like by the numbers we saw.

0.3% month over month price appreciation. This is the highest since February of 2025, so going back a few months ago, and the year over year is 2.7%. We're now further away from that 2% goal that the Federal Reserve has. The core CPI, this is relieving the numbers and the data of volatile elements like food and energy.

That core CPI came in at 2.9% year over [00:11:00] year, following the trend of being a little bit hotter than the headline that takes into account everything. But that's still a little bit below what the forecast was. It's still showing that inflation is sticky. Now, every time I talk about inflation, I'm gonna tell you about the shelter component 'cause I'm still gonna beat that drum.

That interest rates and what it costs for housing is a large part. If not at this point, the main cause for inflation being above 2%. And here's what we've got. The shelter component from this inflation report came in at 3.8%. That's 3.8% price appreciation year over year. So if we're looking at the numbers, the core, which includes shelter, is at 2.9.

It's almost a whole percent more for the shelter component than that average of everything together. Same thing goes, when we look at the headline, the headline being at 2.7, we are more than 1% over. The [00:12:00] shelter component is the reason why we've got inflation persisting like this, and until we see lower interest rates, inflation will persist.

And unfortunately, if inflation's persisting like that in shelter, then all of the other components of inflation need to accommodate that slow price. Decline, right? The disinflation for shelter is a very slow burn as we've been seeing. So we need all the other things to become a lot cheaper, and that's not a circumstance that we're going to see, especially as the conversation's developing so much around tariffs, and that is the cause for anxiety in the markets that is quite frankly, informing everyone to.

Jump in and hop out, jump in and hop out and create the volatility that we've been seeing and part of the reason for this elevated mortgage rate environment that we're seeing this week. Taking a moment to go back real quick to the housing market, we talked in quite. Thorough detail about [00:13:00] New Jersey.

Let's also talk though about what's been going on with respect to the national numbers so that we can have now a reference point. The interest rate environment is having an effect, and I think it's having more of an effect nationally than it is here locally in New Jersey because of that demand.

Simple supply and demand. If you have a lot of demand and the lower supply, even with supply increasing, the demand being pent up for years, we don't have any data to show us who could be buying in the next year, but who wanted to buy this year? The interest rate environment is informing it.

So looking at the national numbers, national price growth has slowed to 1.3% year over year. That's the lowest in two years, albeit the lowest in two years, where the past two years are incredible outliers because of the incredible price appreciation across the country. Nearly one in three major markets are now starting to see price declines.

The market is shifting. [00:14:00] This is happening right now to contextualize again for New Jersey. When it happens nationally, sometimes there's a little bit of a heads up for what's gonna happen here, but this is such a unique case. We can't take that as the gospel truth. We're just going to know that in the past that that has been the case.

The inventory has been surging. This is now the 20th month of inventory gains. That is an incredible run and quite frankly, desperately needed. 28.9% up year over year in active listings. This is good, more opportunity. Then there's also 6.2%, increase in new listings. So this is homes that weren't on the market in the past few years that are now hitting the market.

So there's a mix. There's a mix of homes that were listed, didn't sell, and then came back, and then there's even an increase of new ones. So those were, I will call those defense sitters that may have been on the fence out listing, or quite frankly, life happens. Life [00:15:00] situations dictate that sometimes you need to move.

I need to sell property. That could be a cause for that number as well. But those going up is a good thing. Now let's talk about the seller behavior, because when the market shifts. Rut row for sellers because we've had a couple years of just like, oh man, my home's worth a ton. At some point I'm gonna cash out on this, and the number, it just keeps going up when I go on to Zillow or realtor.com and take a look at the average of the home selling in my neighborhood.

Well, there's a change happening here with this change in the market. Seller behavior's gonna have to start changing. Here's some of the key important information when it comes to that Delists are up 47%. That means that there's quite a few sellers out there that have had.

Improper expectations of what their home is gonna sell for. That's what that means. 37% of builders now, new construction we're talking about here, are starting to cut prices, and the average price cut is around 5%. So [00:16:00] the builders building new homes, they're starting to lean in and pull back some of what they're asking for.

For these homes, price cuts have been occurring across the country, and this is when you have a home listed and then they reduce the price. 20.7% of listings in the country right now. So that's the most in June since 2016. That is. Quite obviously showing us there's a big change happening here in the market.

So the takeaway is that nationally things are moving in a different direction, hyper locally. Here in New Jersey, it could be a sign of things to come, but it's not a guarantee 'cause nothing is guaranteed and things keep changing. And until we have some sort of status quo, this is going to be our status quo, which is, well, quite frankly, a little bit all over the place.

We're just gonna do our best to keep our eye on the information, keep our eye on the ball, and hopefully that will help [00:17:00] us to manage accordingly moving forward. That's it for today. I hope you found this information helpful and useful. Please reach out if you follow me. I did change my Instagram handle recently so you can actually follow me on Instagram at Lone Pro Pete.

On Instagram at Lone Pro Pete, please follow me, DM me. Let me know if there's anything that you want to hear on the show or if you would like me to deep dive into anything that I cover on the show regularly on our weekly updates. I hope you all have a wonderful weekend. I look forward to giving you your weekly update next week.

But in the meantime, take good care.