The best places to invest in real estate are not the hottest real estate markets. It is the smaller and quieter real estate markets primed to take off or that offer excellent financial returns without depending on rapid appreciation of property. This is also why we should re-evaluate overlooked housing markets like Trenton in New Jersey. In this blog, our focus will be on the Trenton NJ real estate market trends and investment outlook for 2020.
Trenton is the capital of New Jersey. It is sits on the New Jersey side of the Delaware River; this river separates it from Pennsylvania. It is at the southern end of the Tri-State region. While it is closer to Philadelphia, there are people who’ve moved here to commute to New York City.
The city of Trenton is home to around a hundred thousand people. However, the Trenton NJ real estate market is larger than this. Trenton and Ewing are often grouped together into one metropolitan area. The Trenton metro area is home to nearly 400,000 people. Is Trenton, NJ a good place to invest in real estate? Trenton is an affordable and growing real estate market. In the latest quarter, Trenton’s real estate appreciation rate has been around 2.5% to 3%.
If it remains steady, the annualized appreciation rate would be around 9% to 10%, which could trigger a massive interest in the real estate investment opportunities in Trenton. Let’s learn more reasons why you may want to consider buying Trenton real estate investment properties in 2020. Please note that there are many variables that can potentially impact the value of a home in Trenton (or any other market) and some of these variables are impossible to predict in advance.
Trenton NJ Real Estate Market Forecast 2020
What are the Trenton real estate market predictions for 2020? Trenton housing market 2020 is shaping up to continue the trend of the last few years as one of the hottest markets in New Jersey. The latest real estate data from Zillow shows that the current median home value in Trenton is $65,513.
Trenton is currently a seller’s market – which means there are a lot of qualified buyers in the market place and not enough homes for sale in the market. The home prices have risen by 9.7% over the last year. Looking forward into the coming year, the Trenton real estate market forecast is that home prices will continue to increase by 8.1%. Since 2015, the median home price in Trenton has increased from $56,000 to $70,500.
Here is the Trenton, NJ real estate price appreciation graph by Zillow. It shows us the current home price appreciation forecast of 1% till Nov 2020.
The median list price per square foot in Trenton is $61, which is lower than the Trenton Metro average of $170. The median price of current listings in Trenton is $80,000 and the median price of homes that have been sold is $57,200. The median rent price in Trenton is $1,300, which is lower than the Trenton Metro median of $1,800.
Zillow reports that 7.6% of the listings in Trenton had a price cut in Nov 2019, which is a good thing for buyers. It shows sellers were willing to negotiate on prices as they were finding it more and more difficult to sell homes at asking prices. The median price per square foot in Trenton in November was $61.
Trenton Housing Market Forecast 2019 – 2021
Here is a short and crisp Trenton housing market forecast for the 3 years ending with the 3rd Quarter of 2021. The accuracy of this forecast for Trenton is 69% and it is predicting a positive trend. The LittleBigHomes.com estimates that the probability for rising home prices in Trenton is 69% during this period. If this price forecast is correct, the Trenton home values will be higher in the 3rd Quarter of 2021 than they were in the 3rd Quarter of 2018. Check this page each quarter for updates to the Trenton, NJ Real Estate Market Forecast.
Trenton NJ Real Estate Market Trends
We shall now discuss some of the latest real estate market trends in the Trenton such as median home prices, inventory, economy, growth and neighborhoods, which will help you understand the way the local real estate market moves in this region. Trenton is affordable and also has a lot of support for low income families. It offers a bustling city surrounded by quiet suburb escapes but there needs to be better overall safety as there are some areas where crime rates are considered to be high.
Trulia has currently 855 resale and new homes for sale in Trenton, NJ including open houses, and homes in the pre-foreclosure, auction, or bank-owned stages of the foreclosure process. The median sales price is $228,950 and homes are selling for about $150/sqft.
As per the real estate company called Neigborhoodscout.com, the median house price in Trenton is $102,752, which indicates that home prices in Trenton are not only affordable but they are well below the national average for all cities and towns in the United States.
Row houses are the single most common housing type in Trenton. Three and four bedroom row houses are the most common housing units in Trenton. Other types of housing that are prevalent in Trenton include single-family detached homes. apartments, duplexes and homes converted to apartments. Trenton housing market has more renters than house owners.
Currently, there are 85 single family homes for sale in Trenton, NJ on Zillow. Additionally, there are 68 single family homes for rent in Trenton, NJ. Under potential listings, there are about 18 Foreclosed and 110 Pre-Foreclosure homes. These are the delinquent properties that may be coming to the market soon but are not yet found on a multiple listing service (MLS).
In the past month, 52 homes have been sold in Trenton, NJ on Redfin.com. In addition to houses in Trenton, there were also 15 condos, 152 townhouses, and 19 multi-family units for sale in Trenton last month. The median asking price is $130,000. According their statistics, the Trenton housing market is somewhat competitive. Homes in Trenton receive 1 offers on average and sell in around 38 days. The average sale price of a home in Trenton was $119K last month, up 58.0% since last year. The average sale price per square foot in Trenton is $76, up 61.7% since last year. A hot listing in Trenton can sell for about 1% above list price and go pending in around 14 days.
Here is the latest Trenton housing market data for the month of Dec 2019 from Redfin.com. The sale to list price ratio shows us that it was a trending more like a seller’s market in the past month.
Trenton Housing Market Trends in Dec 2019
|Median List Price||$130,000|
|Avg. Sale / List||99.4%|
|Median List $/Sq Ft||$89|
|Avg. Number of Offers||–|
|Median Sale Price||$119,000|
|Avg. Down Payment||15.2%|
|Median Sale $/Sq Ft||$76|
|Number of Homes Sold||52|
There are currently 322 homes for sale in Trenton, NJ on Realtor.com. The asking price of single family homes can start from $15,000 and can go up to $2.5M for a luxury property located in Yardville neighborhood in the city of Trenton. The median home price is Yardville, Trenton is $279,000 and homes are selling for $178/Sq Ft. There are currently 123 rental properties in Trenton and their rent prices range from $580 to $3,000 per month. According to Realtor.com, in November 2019, the Trenton housing market was a seller’s market, which means there were more qualified buyers than there were active homes for sale.
In other words, the demand for housing outweighed the supply. Ideally a buyer would prefer a sale to asking price ratio that’s closer to 90%. In Trenton, the sellers have held good leverage in these negotiations in the past month. On an average, they could sell homes for 97.94% of the asking price. A seller would always prefer scenarios which can yield a ratio of 100% or higher.
In November 2019, the median list price of homes in Trenton, NJ was $239K, trending up 19.6% year-over-year. The median listing price per square foot was $154. The median sale price was $231K. On average, homes in Trenton, NJ sell after 78 days on the market. The trend for median days on market in Trenton, NJ has gone down since last month, and slightly down since last year.
The median list price in Trenton, NJ is $139,999 on Movoto.com. The median list price in Trenton was less than 1% change from December to January. Trenton's home resale inventories is 204, which decreased 6 percent since December 2019. The median list price per square foot in Trenton is $103.
As you can see in the graph, the median price per sq ft rose to its peak value in Aug 2019, when it was $104. In December 2019 it was $103. Distressed properties such as foreclosures and short sales remained the same as a percentage of the total market in January.
Trenton is a fairly walkable city in Mercer County. There are 51 neighborhoods in Trenton. Golden Crest has a median listing price of $330K, making it the most expensive neighborhood. Wilbur is the most affordable neighborhood of Trenton, with a median listing price of $60K. Some of the popular neighborhoods include Mill Hill, Battle Monument, Hiltonia, Top Road, Pennsbury Heights, Wilbur, West End, Chambersburg, Glen Afton, Greenwood-Hamilton Historic District, Prospect Heights, Ncia, Glendale, Villa Park, White Horse, Ewingville Franklin Park.
Chambersburg is a neighborhood located within the city of Trenton in Mercer County, New Jersey. It is considered part of South Trenton. Living in Chambersburg offers residents an urban suburban mix feel. There are more renters than homeowners. Chambersburg has a lot of bars and parks.
There are currently 19 homes for sale and 22 homes for rent in Chambersburg, Trenton on Trulia.
- Median Home Value in Chambersburg: $82,500
- Median Rent in Chambersburg: $1,100
- Median Income in Chambersburg: $37,000
South Trenton is the most diverse neighborhood of Trenton. It borders Hamilton Township to the Southeast and the Delaware River to the West. South Trenton is considered by many to be the safest neighborhood in Trenton with relatively low rates of violent crime when compared with other parts of New Jersey's capital city.
There are currently 28 homes for sale and 18 homes for rent in South Trenton, Trenton on Trulia.
- Median Home Value in South Trenton: $83,000
- Median Rent in South Trenton: $900
- Median Income in South Trenton: $40,000
Hiltonia is a neighborhood in Trenton, New Jersey with a population of 3,907. It is located northwest of Cadwalader Park. The housing stock of Hiltonia ranges from fieldstone Tudors to brick Dutch colonials, Cotswold cottages, large split levels to mid-century modern ranches, as well as attached townhouses.
There are currently 4 homes for sale in Hiltonia, Trenton on Trulia.
- Median Home Value in Hiltonia: $220,000
- Median Rent in Hiltonia: $450
- Median Income in Hiltonia: $127,000
If you are looking to invest in the Trenton real estate, you should that three most important factors when buying a real estate anywhere are location, location, and location. Location creates desirability. Desirability brings demand. There should be a natural and upcoming high demand for rental properties. Demand would raise the price of your Trenton investment real estate and you should be able flip it for a lump sum profit. The neighborhoods in Trenton must be safe to live in and should have a low crime rate. The neighborhoods should be close to basic amenities, public services, schools and shopping malls.
Trenton, NJ Foreclosures And Bank Owned Homes Statistics
New Jersey continues to lead the nation in foreclosures rates. As per the Trenton foreclosure data by Zillow, the percent of delinquent mortgages in Trenton is 5.3%, which is higher than the national value of 1.1%. With U.S. home values having fallen by more than 20% nationally from their peak in 2007 until their trough in late 2011, many homeowners are now underwater on their mortgages, meaning they owe more than their home is worth. The percent of Trenton homeowners underwater on their mortgage is 40.2%.
|Total No. of Foreclosures in Trenton||1296 (RealtyTrac)|
|Homes for Sale in Trenton||438|
|Median List Price||$219,900 (2% drop vs Oct 2018)|
There are currently 1,296 properties in Trenton, NJ that are in some stage of foreclosure (default, auction or bank owned) while the number of homes listed for sale on RealtyTrac is 438. In November 2019, the number of properties that received a foreclosure filing in Trenton, NJ was 1% lower than the previous month and 27% lower than the same time last year.
Is Trenton, NJ a Good Place For Real Estate Investment?
Investing in good real estate markets is touted as a great way to become wealthy. Is Trenton a Good Place Real Estate Investment? Many real estate investors have asked themselves if buying a property in Trenton is good investment? If you want to find out whether Trenton real estate is a good investment or not, you need to drill deeper into local trends. The Trenton real estate trends will tell what the market holds for the year 2020. We have already discussed the latest Trenton housing market forecast for 2020.
Purchasing an investment property in Trenton real estate is a little different from shopping for your car or primary residence. While you still want to get the most for your money, if you are looking to make a profit, you don’t want to buy the most expensive property on the Trenton real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, an investment property in Trenton that you might move into or sell at retirement in the future!
Either way, knowing your profit potential and purpose is the first thing to consider. When looking for the best real estate investments in Trenton you should focus on neighborhoods with relatively high population density, employment growth and strong appreciation potential. Let’s now discuss state of the Trenton real estate market, which can help investors who are keen to buy an investment property in this city.
Home Prices in Trenton
The average home in New Jersey is worth roughly 320,000 dollars. The Trenton NJ real estate market like many other well-established East Coast cities, the area has many small apartment buildings and apartment complexes. Roughly a fifth of all residences are in apartment complexes, while roughly one in six people live in a small apartment building. The latter are the most affordable property for new landlords to buy.
Roughly sixty percent of homes were built before World War 2. This lowers the typical purchase price, but it does mean these properties come with higher ongoing maintenance costs. This also contributed to the much larger share of efficiency and one bedroom apartments in the area. Roughly one in twenty apartments is a “no bedroom” property, while almost one in five has a single bedroom.
Two bedroom starter homes and townhomes are crowded into dense urban areas. This also makes the Trenton housing market a bargain for potential investors. However, there are other factors that should be taken into account before you decide to make a Trenton real estate investment.
Trenton Rental Rates
Rental rates in the Trenton NJ real estate market are in line with the state average. When the median gross rent for New Jersey as a whole was 1,284 dollars a month, the average in the Trenton housing market was 1,271 dollars a month. For comparison, the rents in Jersey City are nearly three thousand dollars a month. The lower cost of living drives many people to live in the Trenton NJ real estate market real estate market though they commute to larger, higher paying cities.
This also contributes to the slow but steady appreciation in property values and rental rates in the Trenton housing market faster than local demand and wage growth could cause by themselves. It also explains why the history rental rate in Trenton is lower than the New Jersey state average by one to two percentage points. The greatest demand for real estate is at the affordable end of the market. There is hardly a luxury market for Trenton real estate investment and property redevelopment, though a few such areas exist near the capital building and in walking distance to various universities.
The Legal Climate
New Jersey is landlord friendly. For comparison, New York state is one of the most hostile environments for landlords. This means a Trenton NJ investment property catering to NYC commuters is a good choice, especially if you’re concerned you may need to evict people for non-payment. Nor does New Jersey have the same strict limits on why you can evict people from a rental. There are specific requirements for security deposits, but there is no limit on late fees as long as they are written into the rental agreement.
There are modest payment grace period laws. Once that passes, you can file for immediate eviction. The state doesn’t have pet laws for tenants, so you can evict someone for having an un-permitted pet. You don’t have to have a state license to be a landlord. We’ll say that maintaining the cash flow from a Trenton real estate investment property will be much easier than neighboring New York. Nor is there the same movement to impose rent control in New Jersey.
The Tax System
New Jersey has some of the highest tax rates in the country. New Jersey property taxes average 2.44 percent of a home’s value, well above the national average, a little over one percent. That results in an average property tax bill of roughly 8,000 dollars a year for the average home in the state. Income taxes can range from one to eleven percent. This does mean you’ll be paying high taxes on a Trenton real estate investment property. The challenge is seeing a decent ROI after you’ve paid these costs.
Quality of Life
Trenton had made it in a 2018 list for being the worst state capital to live in. Because it is a state capital, it has amenities like museums and flagship universities. This is why reports give the city an A+ in that regard. It gets a C for cost of living. However, the Trenton NJ real estate market is a relative bargain by the region’s standards. This is why many who want to live in the Tri-State area have to live here, including those that can’t afford better.
The problem is that this is where everyone who has nowhere else to go ends up. This is why the Trenton NJ real estate market is marred by terrible levels of crime. The employment market is weak; unemployment in Trenton is roughly ten percent and double the national average. Wages are low by regional standards, and they stay low because of the large pool of unemployed people.
Both of these factors explain why those living in the Trenton NJ real estate market have a per capita income 12,000 less than the national average and half the state average. One side effect of this is that more than sixty percent of people in the Trenton housing market rent; they cannot afford to buy even a small starter home or condo. There are neighborhoods that are better than others. Some of the best neighborhoods in the Trenton NJ real estate market are the West End, North 25, Battle Monument and Ewing and Carroll.
For example, the entire Trenton housing market received a livability score of 52. Ewing and Carroll alone scores a 60. Berkley Square receives a 61 because of its somewhat better schools, though homes in this area are more expensive for that very reason. Note that you can hire a property manager to manage a Trenton real estate investment property that you wouldn’t feel safe managing yourself. However, this increase the risk that you buy property sight-unseen and end up with a money-sink.
Investing in Trenton NJ Real Estate or Not: The Conclusion
Maybe, you have done a bit of real estate investing in Trenton, NJ but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold. Should you consider Trenton real estate investment? If you frame it as investing in the affordable end of the Philadelphia and New York real estate markets, then the answer is yes. If you want higher returns and less risk, then the answer is no.
However, you can mitigate this by limiting Trenton real estate investment to the better areas in the city. This increases the amount of research required, but it does mean it is possible to buy and profit from real estate in the Trenton housing market. A good cash flow from Trenton investment properties means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt.
Therefore, finding a good Trenton real estate investment opportunity would be a key to your success. If you invest wisely in the Trenton real estate, you could secure your future. If you are a beginner in the business of cash flow real estate investing, it very important to read good books on real estate. You must also collaborate and learn from savvy investors who have retired early on in their lives by investing locally in the Trenton real estate market. As with any real estate purchase, act wisely. Evaluate the specifics of the Trenton housing market at the time you intend to purchase.
Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market area, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing and interest rates.
NORADA REAL ESTATE INVESTMENTS strives to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in the U.S. growth markets. We can help you succeed by minimizing risk and maximizing profitability.
The aim of this article was to educate investors who are keen to invest in Trenton real estate in 2020. Purchasing an investment property requires a lot of studies, planning, and budgeting. Not all deals are solid investments. We always recommend to do your own research and take help of a real estate investment counselor.
Other Good Markets To Invest in Real Estate in 2020
Another good market to invest in real estate is Albany in New York. Albany is a steadily appreciating real estate market. While it isn’t as famous or hot as NYC, it offers an affordable entry point and massive pool of perpetual renters. Though it may not be somewhere you want to live, many locals are choosing to stay and make their homes here. And that will continue to drive demand for Albany real estate investment properties as long as they are priced right.
The other real estate market which looks good for investment in 2020 is Syracuse, NY. The Syracuse real estate market offers cheaper property with a higher return on the investment and less hostile legal climate. It is one of the better choices if you want to invest in New York state. A good cash flow from Syracuse investment properties means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt.
Remember, caveat emptor still applies when buying a property anywhere. Some of the information contained in this article was pulled from third party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
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