New Jersey continues to be plagued by both a troubled real estate market and economy. The real estate market remains awash in homes either in foreclosure, or having gone through a subsequent sheriff’s sale due to default mortgages or tax lien foreclosures. It also remains awash in unsold new construction, and an essentially non-existent new construction pipeline.
Recent figures concerning the market show two different effects of the troubled economy. First, construction of new homes in the New Jersey region fell 18.8%. This included a nearly 10% decline in the construction of single family homes. Second, the number of residential default mortgage foreclosure filings was lower than it was over the same period in a year earlier. Lenders started 4,991 foreclosures against New Jersey homeowners in October 2009, down from 5,262 during October 2008. The peak of 2009 foreclosure came in June 2009, which saw 6,138 filings. These resulting effects relate to each other, as home builders are less likely to erect new homes during this troubled economy while many homes around them are being foreclosed upon.
The foreclosure process appears to be slowing, as there are numerous state and federal programs designed to help owners avoid foreclosure. More than 2,600 New Jersey residents have received counseling through New Jersey’s foreclosure mediation program. Of the 2,600 that received counseling, about 1,450 cases have been closed with roughly half of the residents able to remain in their homes. The federal government reported recently that approximately 22,100 New Jersey homeowners have reworked their mortgages through the federal loan modification program.