A New York Times article by the Associated Press titled…March Retail Sales Fell as Consumers Cut Back….states that retail sales declined a seasonally adjusted 0.4 percent last month, after a 1 percent gain in February.
That’s big news for the Bergen County home sales, and in our specific case it’s big news for how this could affect future home sales in Tenafly, and luxury home sales in Alpine and Saddle River…because retail spending drives about 70% of economic activity.
When consumers begin to cut back on retail spending, it creates a ripple effect on home sales
An example of just how volatile the local housing market is are the home sales in Tenafly…in which more homes are sold in Tenafly per year compared to the surrounding towns by up to 500%. This once stable heaven of home ownership, home sales are down 31% Y/Y compared to 2012
“Consumers cut back spending across a wide range of categories”
With all the hoopla surrounding the calls announcing a housing recovery, people need to take a few steps back to analyze what is happening in their local markets, where its not always what it seems. Sure home sales are up in Bergen County…but that’s ONLY the case for homes priced below $1M. The higher you go above $1M the worse the market becomes, but that’s something realtors don’t like to talk about.
The US consumer looks a little less resilient, an economist at JP Morgan Chase
And why isn’t anyone focusing on other items that affect local home sales on the negative side. Can we have a housing recovery regardless of facts:
- Forever increasing property taxes in suburban New Jersey
- A still unacceptable unemployment forecast…does anyone really think that we can have a real recovery with so many unemployed people. Inst this some of what brought us to a crash and are keeping us from an overall economic recovery?
- New rental complexes are sprouting up in Bergen and Hudson counties. And every rental takes away from home sales
- The decline of the suburbs and the rise of urban areas that are more conducive to today’s consumers
- And incredible number of home sales and rentals in New York City, and increasing home prices are keeping people IN the city, rather than fleeing to the New Jersey and New York Suburbs
Let us know your thoughts on this