“What is happening?” That is the text Farnoosh sent Mike this week. The numbers behind it explain why. Four homes in Montclair have closed for between $3.9 million and $5 million in the past 12 months, one of them a million dollars over asking. Three more are currently under contract after asking in the $3 million range. Montclair home prices are climbing fast enough that residents are asking a new version of an old question: how much house can anyone actually afford here?
$4 Million Home Sales trending
The clearest sign of how fast the market is moving sits on Upper Mountain Avenue. The house at 270 Upper Mountain Ave. was listed at $3.5 million and sold for $4.5 million, a million dollars over asking. A second home, listed in the $3 million range, is under contract, meaning the seller has accepted an offer but the sale has not yet closed, after fielding a bid a million dollars over ask.
The pattern goes back further than this month. A house on Heller Drive fetched $4.6 million this year. The same house last sold for just over $3 million in 2019, before the pandemic reshaped the market, which puts the increase at roughly 50 percent in about seven years. Prices that once took a decade to climb are now moving in a fraction of that time.
“A few years ago, a $3 million sale in Montclair was front page news,” Farnoosh said on the show. “Now? Four million dollar homes are just … Tuesday.”
Montclair Home Prices Are Up More Than 40 Percent This Year
Those individual sales are not outliers. They track with what is happening citywide. Montclair’s median home price hit $1.4 million this spring, more than 40 percent higher than the same period a year ago, according to Redfin. Homes are selling in about three weeks, and buyers are routinely bidding well over asking.
That does not mean every home in town gained 40 percent in value. It means the citywide median, the point where half of homes sold for more and half sold for less, jumped that much, which is still a clear signal of how expensive the overall market has gotten.
The frenzy isn’t limited to the multimillion dollar tier. The New York Post reported this week that Montclair is running hotter than any of its neighboring towns, with buyers currently paying close to 25 percent over asking, according to Mark Slade, a real estate agent with Keller Williams Midtown Direct Realty who has tracked the area since 2009. One recent example: 35 Porter Place sold for $1.525 million against a $1.395 million asking price. “Buyers should generally expect some type of bidding war,” Slade told the Post.
What’s Actually Driving Montclair Home Prices Higher
Farnoosh and Mike asked the obvious question on air: what is actually driving this? Interest rates have not meaningfully dropped this year. The school district is still working through its financial crisis. Nothing structural has changed in town that would explain such a jump.
The explanation pointed away from Montclair entirely, toward Wall Street. The S&P 500 has gained more than 20 percent over the past 12 months, and when affluent households feel richer on paper, they tend to get more willing to stretch for the house they actually want. An extra million on a home price barely registers the same way it used to. One realtor explained it this way: More parents are helping out their adult kids purchase homes, a trend reported by Lending Tree. A recent survey found that 40% of homeowners got financial assistance with the down payment on their existing home. That’s up more than 50% in 2023.
What It Actually Costs to Buy a Home in Montclair Right Now
Farnoosh ran the math live on the episode. Buying the median priced home in Montclair with 20 percent down puts the mortgage at roughly $7,000 a month. Add Montclair property taxes, about $22,000 a year, plus insurance, and the total cost of owning the house climbs to around $9,000 a month.
“Before groceries,” Mike said.
“Before groceries,” Farnoosh replied. “Before childcare. Before your student loans. Before car payments. Before vacation. Before literally anything else.”
Financial planners generally recommend spending no more than 30 percent of take-home pay on housing costs. To hit that target on the median Montclair home, a buyer would need to bring home about $30,000 a month, or roughly half a million dollars a year before taxes.
“Half a million dollars in earnings,” Mike said. “To buy the median house. In Montclair. Not Manhattan.”
What’s Next for Montclair’s Housing Market
Between the sales frenzy on Upper Mountain and Heller Drive, the stock market’s role in fueling it, and the math Farnoosh laid out on air, the same question keeps surfacing: who can actually compete in this market, and who gets left out of it. It is a question Farnoosh and Mike plan to dig into later this summer with local real estate experts, covering who is buying these homes, how they keep winning bidding wars and whether there is any relief in sight. Readers can also see how school budget pressures factor into the town’s housing fundamentals in our earlier real estate outlook, part of the Pod’s ongoing real estate coverage referenced in this year’s guide to Montclair.
Until then, the Pod wants to hear from readers navigating this market firsthand. Anyone with a bidding war story, a house hunt that stalled or a question for our upcoming real estate segment can email hello@montclairpod.com.
Image credit: NJMLS
