Slowly but steadily, New Jersey's housing market is recovering.
The average home sale price in New Jersey in 2015 was $397,279, according to the state Division of Taxation. But most towns throughout New Jersey are still showing average sales below the pre-housing bubble peaks.
"We're not out of the woods yet," said Tg Glazer, president of the New Jersey Realtors Association. "There's still work to be done, but everything is looking very positive and I believe that things will continue to move forward throughout the year."
See town-by-town average home sale prices in 2015, 2010 and 2005:
Atlantic | Bergen | Burlington | Camden | Cape May | Cumberland | Essex | Gloucester | Hudson | Hunterdon | Mercer | Middlesex | Monmouth | Morris | Ocean | Passaic | Salem | Somerset | Sussex | Union | Warren
Figures from the New Jersey Realtors Association for 2015 show home sales rose 12.3 percent to 93,635 and there were small upticks in the median and average sales prices, according to figures from the New Jersey Realtors Association -- a hopeful sign as the spring selling season gets underway.
The 22.7 percent jump in pending sales in December over the year before pointed to 2016 getting off to a strong start. But even as job gains, low mortgage rates and consumer confidence help boost home sales, the number of homes for sale has fallen.
In December, for example, there were 10.6 percent fewer listings -- 49,829 compared to 55,720 at the same time in 2014.
"Our economy and housing sector are both better than where they were in the recession, but both have a ways to go before anybody would want to cheer at the pace of activity," said Patrick O'Keefe, director of economic research at CohnReznick, an accounting and consulting firm.
Even though home prices are showing signs of increasing, there is still a large number of homeowners who are underwater on their mortgages and are reluctant to sell at a loss, he said.
"If they bought from 2005 to 2007, they paid prices that were still well above where the market is today," O'Keefe said. "As a consequence, if they list their homes for sale, they're going to get offers well below what they paid and unless it's a distressed situation where they have to move, it would be irrational to sell the house at the discounts."
New Jersey housing prices continue to lag behind the national average, he said, citing the housing price index calculated by the Federal Housing Finance Agency.
Nationally, prices in the last quarter of 2015 were 0.3 percent higher than in 2007, while New Jersey's prices were 13.8 percent less. But compared with New Jersey's own peak in the second quarter of 2006, prices are down 21.3 percent.
"Those price factors are a major reason why the state's housing recovery has lagged the rest of the country," O'Keefe said. "Our prices ran up more sharply prior to the housing meltdown and have recovered far more slowly in the aftermath of the meltdown."
O'Keefe added that the state's share of distressed mortgages -- those in foreclosure or more than 90 days delinquent -- is the main reason its housing recovery has failed to keep pace with the rest of the nation.
New Jersey's distressed mortgage rate was 8.5 percent in the final quarter of 2015, more than double the national average of 3.4 percent. For the last nine quarters, the state has ranked the highest in the nation.
There has been progress in reducing that number, but there is still a long way to go, O'Keefe said.
New-home construction is not as robust in New Jersey as it is in the rest of the country -- largely because of high development costs and more restrictive zoning rules -- but 2015 was still its strongest year for permit approvals since 2006.
"The overall picture is positive but weaker than what we may see elsewhere around the country," he said.
Cristina Rojas may be reached at crojas@njadvancemedia.com. Follow her on Twitter @CristinaRojasTT. Find The Times of Trenton on Facebook.