Imagine a family contemplating two paths with the same budget. One option is to continue renting while saving more money, and the other is to stretch their finances to buy a home in Demarest. Comparing these two choices reveals the unique circumstances of this neighborhood.

According to Zillow, the average home value in Demarest is $1,566,155 as of June 2026, a 17.2% increase from a year ago. Redfin reported a median sale price of $2.3 million for the same three-month period, reflecting a steeper 32.7% rise. However, it's important to note that Demarest is a small town with relatively few transactions, so a few high-value sales can significantly skew the average.

In reality, Demarest does not have a high volume of annual transactions. A couple of ultra-high-end properties selling can cause the average to spike. Nevertheless, the fact that both Zillow and Redfin show double-digit increases suggests a genuine rise in demand that cannot be easily explained by temporary distortions.

On the rental side, there is insufficient data for Demarest, so we refer to the average rent in Bergen County, which is $2,541 per month. Using this figure to calculate the price-to-rent ratio, we divide $1,566,155 by the annual rent of $30,492, resulting in a ratio of 51.4. If this term is unfamiliar, think of it this way: this number indicates how many times the purchase price is compared to the annual rent. A ratio of 51 means that, purely in terms of monthly expenses, renting is significantly lighter in this city.

This is where the two choices diverge. Those who choose to rent have lower monthly expenses and can allocate the remaining money towards a down payment or other assets. In contrast, buying makes sense when there is a clear intention to educate children in the Northern Valley Regional School District for an extended period. Demarest consistently receives high ratings for its school district, so if this goal is certain, many families opt to buy despite a high price-to-rent ratio.

When we look at the two options over a longer term, the differences become clearer. Renters will not accumulate assets after ten years, while buyers will see their net worth increase by the amount of principal repayment. However, it is also important to note that it may take considerable time for that net worth to exceed the investment returns from the money saved by renting. If a $1,566,155 home is purchased with a 20% down payment, the remaining $1,253,300 financed with a 30-year mortgage at a 7% interest rate results in monthly principal and interest payments of around $8,340. Including property taxes, this can exceed $9,500. Compared to the average rent of $2,541 in Bergen County, the gap is quite significant. Thus, buying in Demarest can be seen as a decision driven more by school district considerations and a commitment to the area than by pure financial calculations.

When we consider the need for a down payment, the distinction becomes even clearer. A 20% down payment requires around $310,000, so if a family does not have this amount saved, continuing to rent while accumulating funds seems like the safer choice. If they have the funds ready and a clear plan to settle for 15 or 20 years, the situation changes. The initial high property taxes and closing costs can be spread out over a long period.

New Jersey has some of the highest property taxes in the nation, and in areas like Demarest where home prices are high, the burden is even greater. Since taxes and insurance can vary by property, it is advisable to check the annual property tax for any properties of interest in advance.

For families considering Demarest, comparing properties with neighboring towns like Cresskill or Closter can also be beneficial. These towns share the same school district but differ in sale prices, lot sizes, and the age of homes. If the budget does not reach the upper price range of Demarest, there is also the option to look at neighboring towns with slightly lower sale prices while maintaining the school district. This article does not constitute investment or legal advice, and it is recommended to consult with professionals before making any actual contracts.