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While the rest of the country struggles with a stagnant housing market and high interest rates, New Jersey has emerged as the nation’s leading leader in home price growth.
Driven by high-paying jobs and an exodus from Manhattan, the state is exceeding the national average and outperforming COVID-era hot spots like Florida.
According to one recent report from Cotality, the Garden State isn’t just growing; it outpaces the field by a wide margin, with home prices rising nearly 6% in February from the previous year. The US national average growth over the same period was just 0.5%.
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More specifically, Newark recorded a 6.7% year-over-year price increase, marking the steepest increase among the 100 largest metro areas in the US.
Newark’s skyline reflects the banks of the Passaic River at night. (Getty Images)
New Jersey’s housing supply remains well below pre-pandemic levels, with nearly 40% of homes selling above asking price.
“These divergent trends indicate an ongoing process of price discovery – one that limits sales and comparisons – and underline a market that is rebalancing locally rather than correcting nationally,” Cotality chief economist Selma Hepp said in the report.
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“While the steady decline in mortgage rates ahead of the spring homebuying season raised hopes for a rebound in home prices and sales in 2026, the recent rise in rates has dampened demand in the housing market,” she added, “shifting expectations for a broader recovery this year.”
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The boom in New Jersey could be linked to workers being priced out of New York City and choosing the neighboring state to avoid sacrificing their entire salaries while still maintaining access to public transportation. Many of these new commuters are in the financial, pharmaceutical or biotechnology sectors.
Looking south to the Sun Belt and the western border, Cotality’s data also indicates that previously red-hot markets are starting to see corrections: Florida fell more than 2% in price, Washington, DC and Montana saw similar declines of around 3%, and a total of thirteen states recorded outright price declines in February.
