Why Madison's Real Estate Market Defies National Trends This Fall

After many years living in, and selling real estate in Madison and the surrounding Morris County towns, I've learned that our market operates on its own rules. While national headlines discuss cooling markets in Austin, Phoenix, and Florida, we're seeing something entirely different here - and understanding why matters whether you're buying, selling, or simply curious about your home's value.

The Spring That Wouldn't Quit

This past spring was extraordinary. We regularly saw 15 to 24 offers on well-priced properties. I remember thinking six offers was disappointing - that's how competitive it became. One listing attracted 47 showings and 15 offers, ultimately selling for 25% above asking price.
What's driving this? The millennial wave I predicted years ago is still here. When industry experts forecast that millennials would remain committed to urban living, I never bought it. My generation did the Jersey City and Hoboken thing, but eventually you want grass, trees, better schools. The thought of pushing a stroller down Hudson Street loses its appeal.
The 2008 financial crisis delayed millennial wealth building—the oldest were only in their late twenties when it hit. But as this massive generation (rivaling baby boomers in size) moved through their thirties and into their forties, suburban migration became inevitable. COVID accelerated it, but didn't cause it.

The Current Market: Still Strong, Just Not Crazy

Summer brought the seasonal slowdown we typically see, combined with some buyer fatigue. When you've written your eighth offer and lost out, taking a break makes sense. But make no mistake, this remains a seller's market.
The absorption ratio tells the real story. This metric shows how quickly inventory moves off the market. Anything under three months signals a seller's market. In Madison, Chatham, and surrounding towns, we're seeing absorption rates around one month even at the $2-3 million price point. For entry and mid-level homes, it's even faster.
If I had to rate the market, spring was a 10. Right now? It's about 8.5. Still very strong, just not the frenzy we saw in March through May.

Why Inventory Remains Tight

The biggest constraint on our market is simple: why would anyone move when they have a 2.75% mortgage? Trading up means a more expensive house and more expensive financing at 6.25%. The math just doesn't work for many people.
The sellers we're seeing fall into specific categories: downsizers cashing out to buy smaller homes or condos for cash, those relocating to second homes at the Jersey Shore, estates being settled, and people willing to make the financial trade-off despite the rate environment.

What Makes Madison Worth It

There aren't many towns on the Morris & Essex line that offer Madison's combination. The Midtown Direct service to Penn Station means a 50-minute commute. Newark Airport is 20-25 minutes away. The schools consistently rank among the best in the area.
The downtown, with its architecture donated by wealthy benefactors in the late 1800s, regularly attracts film crews. The sense of community, from Bottle Hill Day in October to the Christmas parade the Friday after Thanksgiving, creates something you can't replicate.
When people move here, they fall in love with it and tell their friends. That word-of-mouth compounds over time. There's only so much supply, and when millennials are ready to make the move west, Madison sits at about the limit of how far most want to commute.

The Bottom Line

Our market operates differently than national trends suggest. Strong fundamentals: limited inventory, continued demand from millennials, excellent schools and transportation - keep prices elevated and competition fierce.
For buyers, fall and winter offer slightly more breathing room than spring's chaos. For sellers, even with seasonal cooling, demand remains robust if you price correctly and present your home well.

Scott Spelker of The Spelker Team has been a real estate professional with Coldwell Banker Realty in Madison for over a decade. Prior to real estate, he spent 25 years on Wall Street trading foreign exchange. He serves as Madison's town historian and has lived in the area for more than 50 years.