Report: Newark housing prices, rents level off since recession

By Naomi Nix/The Star-Ledger
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on April 22, 2014

Newark housing sale prices have fallen back to where they were in 2000, according to a new report. In this file photo, a house is for sale in Seaside Heights.


ESSEX COUNTY — Newark housing sales prices have leveled off since plummeting during the recession but rents remain high, according to a new report.

“Investors are buying these properties instead of home buyers so they can rent them out and make money,” said Diane Sterner, one of the researchers who produced the report.

Researchers from non-profit organizations New Jersey Community Capital, Joseph C. Cornwall Center for Metropolitan Studies and Rutgers University primarily analyzed Newark police department crime statistics and census data to produce the 69-page report.

The median sales price for a one-to-four bedroom home hovered around $118,000 in 2000, but then shot up to more than $307,000 during the nationwide housing bubble around 2006, according to researchers.

But by 2012, the median sales price had dropped to about $125,000, the report said.

A spike in foreclosures coincided with the dip in housing sales prices. Foreclosures peaked in 2009, but the rates have since leveled off.

Meanwhile, median rents for all units have risen over the last decade from $586 a month in 2000 to $954 a month between 2010 and 2012.

Rental prices differ sharply across neighborhoods. The average Dayton rental was priced at $286 a month between 2007 and 2011, compared with $1,609 a month in Upper Clinton Hill, the report said.

The rising rents can be attributed to Newark's location, the number of people who have lost their homes, and the lack of new rentals being created, said Alan Mallach, another researcher on the report and a senior fellow at the Center for Community Progress.

"All of this is putting pressure on the rents," Mallach said. "On the flip side you have a lot of poor people who can't afford the rents."

The report was commissioned by Living Cities, a national organization that advocates for investing in low-income communities. Researchers plan to meet with various Newark stakeholders to share their findings.

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