New Jersey’s residential real estate market ended 2025 on stable ground. This is highlighted by steady buyer demand and continued price growth despite affordability challenges and limited inventory. Year-end data from New Jersey Realtors indicate the market remained resilient, avoiding dramatic swings due to ongoing supply shortages and consistent buyer interest across property types.
Across all residential categories, the median sales price in New Jersey increased 5.4% year over year to $525,000 in 2025. That price growth came alongside 86,440 closed transactions statewide, a level that closely mirrors activity seen in the prior year. While sales did not surge, they also did not retreat significantly, underscoring a market that maintained momentum even as higher borrowing costs and limited choices tempered some buyer activity.
Time on market edged upward during the year, with the average number of days to sell rising 8.3% to 39 days. Even with that increase, homes continued to move relatively quickly by historical standards. Properties also continued to command strong pricing power, with sellers receiving an average of 101.5% of their asking price. Though slightly lower than last year’s figure, the data points to an environment where competition among buyers remains a defining feature.
Single-Family Homes Lead Price Growth
Single-family homes once again emerged as the strongest-performing segment of New Jersey’s housing market. The median sales price for single-family properties climbed 6.4% in 2025 to reach $585,000, reflecting ongoing demand for detached homes across suburban and exurban markets.
Inventory constraints played a central role in driving those gains. At the end of December, just 8,978 single-family homes were listed for sale statewide, representing a 7.3% decline compared with the same period in 2024. That limited supply kept upward pressure on prices and reinforced competitive conditions, particularly in areas with strong school districts and commuter access to major employment centers.
Single-family homes also continued to sell quickly. On average, these properties spent just over 37 days on the market and achieved 102.2% of the list price, signaling that bidding wars and multiple-offer situations remained common, even as buyers grew more selective than during the peak pandemic years.
Adult Communities See Rising Prices and Inventory
Adult and age-restricted communities posted another year of notable growth, highlighting the influence of demographic trends on New Jersey’s housing market. The median sales price in this segment rose 5.7% in 2025, an increase of approximately $20,000, bringing the median to $370,000.
Unlike other segments of the market, adult communities experienced an expansion in supply. New listings increased nearly 8% compared with 2024, and the number of homes for sale in December was up 14.4% year over year. That rise in inventory reflects both new development activity and resale listings as homeowners adjust to changing lifestyle needs.
Modest Gains in Condos and Townhomes
Townhouses and condominiums experienced more modest appreciation in 2025, with the median sales price increasing 2.9% year over year to $422,000. This segment attracted buyers looking for relative affordability compared with single-family homes, particularly first-time buyers and those seeking proximity to urban centers and transit hubs.
While price growth was slower, activity levels remained consistent. Pending and closed sales across the condo and townhouse market fluctuated only marginally, suggesting a stable base of demand. However, rising homeowner association fees and ongoing affordability challenges tempered stronger appreciation in some areas.
A Market Defined by Tight Supply
Across all residential property types, New Jersey’s housing market remained defined by limited inventory. Statewide, the supply of homes hovered around a two-month level, well below what is typically considered a balanced market. This persistent shortage continues to distinguish New Jersey from some national markets that have seen more pronounced inventory recovery.
The tight supply helped maintain seller confidence and prevented any meaningful price corrections, even as buyers became more cautious in response to elevated mortgage rates earlier in the year. Homes continued to sell at or above asking price on average, reinforcing the competitive dynamics that have characterized the state’s market in recent years.
Industry leaders say the stability seen in 2025 reflects long-term structural challenges rather than short-term fluctuations. New Jersey Realtors leadership pointed to sustained demand combined with years of underbuilding as the primary drivers of current conditions.
Mortgage Rates Offer Late-Year Relief
One notable development toward the end of 2025 was a gradual easing of mortgage rates, which began to improve buyer sentiment heading into 2026. After spending much of the year above 6.5%, borrowing costs started to decline in late December, offering some relief to households that had postponed purchases.
That trend accelerated in mid-January, when mortgage rates fell to their lowest level in more than three years following a federal announcement aimed at supporting housing affordability through mortgage-backed securities purchases. For the week ending Jan. 15, the average rate on a 30-year fixed mortgage declined to 6.06%, down from 6.16% the previous week and well below the 7.04% average recorded during the same period in 2024.
The drop in rates is expected to bolster buyer confidence in the months ahead, particularly among those who had been waiting on the sidelines for more favorable financing conditions. While lower rates alone are unlikely to solve New Jersey’s affordability challenges, they may help unlock pent-up demand and support transaction activity in 2026.
Looking Forward to 2026
As New Jersey enters the new year, the housing market appears positioned for continuity rather than dramatic change. Price growth is expected to remain moderate, supported by limited supply and steady demand, while sales activity could see a modest lift if mortgage rates continue to ease.
Affordability remains a central concern, though, especially for first-time buyers and lower-income households. Without a significant increase in housing production, inventory constraints are likely to persist, keeping competition elevated in many communities.
The 2025 data paints a picture of a housing market that has adjusted to higher interest rates without losing its footing. Stability, rather than volatility, defined the year, setting the stage for cautious optimism as buyers, sellers, and industry professionals look toward the opportunities and challenges of 2026.
