Home prices continued to increase moderately nationwide in the third quarter, the National Association of Realtors said this week, but in the South Jersey shore region, they kept declining.
The 1.7 percent decline in single-family-home prices from the same quarter a year ago in the combined Atlantic, Cape May and Cumberland counties represents an improvement from the 12-month drop of 8.2 percent in the second quarter.
The NAR survey considers the three counties one statistical area, which masks the considerable differences among the local counties.
A report by market information firm CoreLogic this week showed that in September, the home price softness was all in Atlantic County, while Cape May and Cumberland counties saw price increases.
Atlantic County home prices, including distressed sales, dropped by 3.8 percent in September compared with the same month a year ago and by 1.3 percent compared with August, CoreLogic reported.
In Cape May County, meanwhile, home prices were up 1.5 percent for the year through September, and 2.5 percent higher than in August. Cumberland County prices rose 2.3 percent for the year and 0.2 percent from the prior month.
Joseph Sheppard, broker/agent with Berkshire Hathaway HomeServices Fox & Roach Realtors on West Avenue in Ocean City, said two factors stand out among several responsible for the continued strength of the market there.
One is incredibly low interest rates, “the best in many years,” he said. That’s helping real estate everywhere.
Ocean City benefits from “an almost unique” market, he said, that enjoys strong demand from three kinds of buyers: those seeking second homes, those looking to invest, and those wanting their primary residence in the oceanfront resort.
Sheppard said that in the past six months, he has sold three homes to people seeking to live in Ocean City year-round.
This week, he’s closing on a single-family home on Dory Drive for a young couple, currently in Vineland, who have chosen to live at the shore, he said.
He said some new housing construction in the city also should draw interest for year-round residence, assuming it’s priced right.
Sheppard said demand in Ocean City has been strong since Hurricane Sandy. The storm and the regulations that followed prompted the renovation and/or elevation of “a lot of older properties that were kind of outdated or at ground level.”
“Our market had started to recover before Sandy came, and we were blessed that what happened in North Jersey didn’t happen to us,” he said.
The result of all this is that “home prices have remained solid and have been increasing the last few years,” he said. “We’re within an easy drive of millions of people, and people want to be here.”
The NAR survey released Thursday showed median sale prices of existing U.S. homes were 4.9 percent higher in the third quarter than a year ago.
Prices in the Northeast were softest at an increase of just 2.2 percent, while the Midwest saw the highest annual price appreciation at 5 percent.
Prices increased in 125 of the 172 metropolitan areas surveyed by the Realtors, and declined in 27 percent of them.
An investor-driven run-up in home prices has eased this year, and the market is now in transition to a modest rate of growth that matches the slowly improving national economy.
“Home-price gains returned to more normalized levels of low- to mid-single-digit rate of appreciation in many metro markets as inventory levels steadily increased,” Lawrence Yun, NAR chief economist, said in a statement. “There are a good number of local markets that are still remarkably affordable with median prices at or under $200,000.”
The combined Atlantic, Cape May and Cumberland counties market saw a median sale price of $213,100 in the third quarter.
Nationally, the median home price was $217,300 in the third quarter. The Realtors figured there were 2.3 million homes on the market, a 5.4-month supply at the rate of sales in the quarter.
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