No bottom for the shore

From the Philly Inquirer:

Shore home prices still falling

ome prices at the Jersey Shore continue to search for a bottom, almost four years after the U.S. housing market took a downward turn.

An analysis of second-quarter 2010 sale prices in Atlantic and Cape May Counties, done by Econsult Inc. vice president Kevin Gillen for Prudential Fox & Roach, shows that the typical Shore house has lost 24 percent of its value since the market’s peak in the second quarter of 2006.

By comparison, Philadelphia’s single-family home prices fell 6.8 percent in the same period, U.S. prices dropped an average of 13.2 percent, and the average decline for New Jersey as a whole was 13.6 percent.

“This disparity is likely attributable to the fact that the market for Shore homes is disproportionately composed of vacation homes, rather than year-round primary residences,” Gillen said last week. “As foreclosures have climbed along with unemployment and mortgage delinquencies, most households are incentivized to liquidate their second home or vacation home before doing likewise to their year-round residence.”

In 2005, said Moody’s Analytics Inc. chief economist Mark Zandi, “76 percent of loans to purchase a single-family home in the Ocean City metro area were to investors – the highest in the country.”

“Yes, the boom, bubble, and bust in Jersey Shore prices is due, in significant part, to the rampant speculation in housing,” Zandi said.

Bill Mestichelli of Philadelphia has sold two vacation houses and a rental property in Ocean City in six years. Even with a dip in prices of 14.7 percent since 2006, he said, “I think the market down there is still way overpriced.

“The mortgage companies are very tight with lending for second homes without a hefty down payment,” Mestichelli said. “I plan to get back in the market in Ocean City in about two years, when I believe the prices will stabilize.”

How distressed is the Shore? Since 2007, there have been 10,527 foreclosure filings in Atlantic County, with lenders taking back 1,236 homes, according to RealtyTrac Inc., of Irvine, Calif., which tracks U.S. foreclosures. For the same period in Cape May County, there were 4,665 filings and 580 lender repossessions.

The hardest-hit town has been Atlantic City, where prices have nose-dived 63.3 percent since the market’s peak, Gillen’s analysis indicated.

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63 Responses to No bottom for the shore

  1. Mr Wantanapolous says:

    Down the shore, ererything’s not all right.

    NJC [207]- Previous thread

    Yep. We always had a group of 20-30. Us bennies and the locals from Bay Head and PP.

    In the winter, when I was home from school, it was Kinderhook at Dodd’s.

  2. Mr Wantanapolous says:

    everything’s

  3. Mikeinwaiting says:

    Might not be in waiting to much longer. Looking at an REO asking 113, 3 bd 2 bath raised ranch. Would rather rent but the rental market in my town hot everything goes quick at what ever dream figure they put on it. As per my re agent friends “everybody being foreclosed on now have to rent”, good times.

  4. Essex says:

    May I suggest a new handle mike? Mikeinbfe

  5. Poltroon says:

    mike (3)-

    Up in that part of the world, do you have to lay siege to the house before you move in, or do they have title closings like in civilization?

  6. Poltroon says:

    sx (4)-

    BFE? I have a map to get to BFE. Sussex Co. is another animal.

    Mike, I think my daughter is playing field hockey in Vernon this week. Might be able to come up that day & tool around for a few hours before the game. You around?

  7. Mikeinwaiting says:

    Ok I’ll bite bfe? Best friend ever doesn’t work.

  8. Mikeinwaiting says:

    6 Clot want day will do my best to make myself available.

  9. Mikeinwaiting says:

    want = what, more coffee!

  10. Mikeinwaiting says:

    Clot no sieges, would surely be more fun.

  11. willwork4beer says:

    #7 Mike

    BFE = Bum Fcuk Egypt
    AKA the middle of nowhere

  12. Fast Eddie says:

    If you don’t have the Bergen Record this morning, go get it. The title on the front page of the Real Estate section reads, “Big Market for Seller Frustration.” It’s too juicy to list all the points here or else I’d write the whole thing. It’s chock full of every tag line we’ve ever mentioned on this blog in the last 3 years. It’s house pron in it’s entirety. No, this is not Schadenfreude, this article is simply stating what we’ve been saying all along. Read the article.

  13. freedy says:

    The sellers in today’s record are in for a big surprise . screwed ,

  14. Mike says:

    Ah Sunday my favorite day of the week, football games and open houses. I get to watch talented athletes on the field and talented stand up comedian house guides tell jokes from the wet & damp comedy club basements. Remember the shrinkage episode from Seinfeld when George had his manhood made fun of by a woman and George kept telling everybody it shrinks when it gets wet. Looks like the price will keep shrinking. I know that’s such a stupid example but I’m on my third cup of coffee. Just remember one thing Mr. & Mrs. comedian there’s over a dozen houses in this town within the 500K range and some for sale close to a year. Yes I know the ones in the 300K range are moving. Eventually the 500K people are going to have lower it to a range where somone can get approved. Now the 300K homes gobbled up are worth 200K it’s elementary my Dear Watson. OK no more caffeine I’ll just read the posts between half time.

  15. NJCoast says:

    Case in point

    2 Interlaken Dr., Interlaken, NJ- waterfront (lake) less than a mile from the beach.

    Closed- short sale- 9/30/10- $650,000
    Previous sale-2/15/06- $1,400,000

  16. Shore Guy says:

    NJC,

    Was that the poorly constructed one you discussed a few weeks back?

  17. NJCoast says:

    “Down the shore everything’s not alright”

    Just packed up the martini shaker and closed the cabana until next Memorial Day Weekend. Cry.

  18. Shorre Guy says:

    “Though states cant withdraw the promises they have already made, they could reform their civil service systems going forward to make them more affordable for taxpayer”

    BS. These can be changed. Yhe thing is that the politicos are not willing to take the heat necessary to make the changes.

    Never forget (like too many politicans seem to have done so already), management holds the cards in public-sector labor negotiations. Absent a legal right to strrike, public-sector unions lack the power attributed to them. Interest arbitration complicates this for police and fire but can be addressed legislatively to remove that roadblock.

    A governor, county executive, Mayor, Freeholder Board, etc. is able to insist on achieving a particular thing, say pension cost reduction of 30% and, if the parties reach “true impasse,” can unilaterally implement the changes — all within the law. If the employees take great offense and strike, management still has the upper hand.

  19. Shore Guy says:

    one less r

  20. NJCoast says:

    Shore-

    No- that one (712 Grassmere) amazingly sold for $615,000 after it was originally listed for $1,699,000. It was bank owned after the owner walked on a $1,001,000 mortgage. 2 Interlaken Dr. had a $1M mortgage and the guy owned 2 other “investment” properties.

    Wait until both buyers find out their property tax bills will (at least) double as Interlaken, who still has not joined an operating school district as mandated by the state, will eventually to be forced to pick a district. Both Interlaken and Allenhurst have their heads in the sand thinking that Christy has his hands full with all that’s gone on with Schundler, teachers unions, etc., that he’s just going to forget that these two towns (the only two remaining in NJ) have not fulfilled the mandate.

    And so much for consolidation bringing down property taxes. Interlaken’s taxes went up this year- reason given: they got rid of the police force and hired Deal to patrol the town. Huh??

  21. Shore Guy says:

    As for price pressure on typical shore properties. North of Lacy, is not “typical,” at least as far as the Philly article paints them.

    The Shore is really two Shores:

    The Benny Shore — NY/NNJ and the Shoobie Shore — Philly.

    The Benny Shore is much more a bedroom community of NY and North Jersey. There are pockets of mainly investment properties, especilly in the Seaside/Lavalette areas.

    Down south, it is much different. There is not the huge number of people flowing from the Shore to Philly for work.

    That said, things are still overpriced in Monmouth County, especially east of 71 — the true Shore.

  22. Juice Box says:

    If this is deflation, I would hate to see what inflation looks like.

    Here are some interesting numbers that I would imagine will flow through directly to consumers in the coming year:

    Commodity Price…………………% Increases (Year over Year)

    Agricultural Raw Materials……….24%
    Industrial Inputs Index…………..25%

    Metals Price Index………………..26%
    Iron Ore…………………………..103%

    Hides……………………………….25%
    Rubber……………………………..62%

    Coffee……………………………..45%
    Barley………………………………32%
    Oranges……………………………35%
    Beef………………………………..23%
    Pork………………………………..68%
    Salmon…………………………….30%
    Sugar………………………………24%
    Palm Oil……………………………26%

    Wool……………………………….20%
    Cotton……………………………..40%

    crude oil………………………….16%
    gold……………………………….32%
    silver………………………………35%
    s&p 500 index…………………….12%

    Deflation my ass Federal Reserve, be-sure to get your raise from your Boss now before everyone else in your Company starts asking for one.

  23. Shore Guy says:

    NJC,

    Oy!

  24. Juice Box says:

    #21: Sure are allot of Million dollar foreclosure sales in Monmouth County lined up for the next few months.

    http://www.sheriffguadagno.com/index.php?mod=Foreclosures&start=150&colsort=cs_date%20DESC,s_file&swords=

  25. Shore Guy says:

    Light of Day should be the theme song for all the politicians who refuse to make the necessary cuts to get our respective economic houses in order.

    Did anyone see the thing I posted about Califirnia? They had a $19B gap, the Gov proposed a $12B cut in the budget (still leaving a $7B gap to be solved with magic). In the end, the Gov and legislature agreed upon a total cut of $7B (leaving $12B to fall from the sky due to “an improving economy and increased federal aid.”).

    Clearly they all believe we ar “just around the corner from the light of day.”

  26. Juice Box says:

    re: 12 – Angry Bitter Sellers from the Bergen record in 2010.

    http://www.northjersey.com/realestate/104228424_Big_market_for_seller_frustration.html

  27. syncmaster says:

    I have been informed by a realtor with a vested interest in me believing this, that one-third of Phase I planned new construction (Heritage at P-way by American properties) were “booked” over a single weekend.

    I don’t know if I believe it or not, but I have noticed a lot of couples with kids going in and out of the sales office.

    Base model is just shy of 2000 sq ft, 417K. 3 bedrooms, 2 car garage, no basement. My wife saw the floor plan and thinks there’s a lack of storage. Lot sizes are below 8000 sq feet.

  28. Mike says:

    My favorite line from the Bergen Record article this morning: In fact, there’s one sentence that real estate agents hear over and over: “I’m not giving my house away.” That’s right people you should’nt! You should sell tickets to your open houses for the wonderful stand up acts the comedians will put on trying to sell it for you. It’s about 12:00 now I got to get going, you know I hate waiting in those long lines at open houses.

  29. Libtard says:

    Barbara,
    I wish you luck with your pending purchase. Please say it isn’t in Montclair.

    ShoreGuy,
    I’m at 15 days since the complete rupture and 9 days since the surgery to fuse my tendon back together. I’m still in a knee-t- foot splint for the next 8 days when I have the choice between an overweight boot or a non-weight-bearing cast. I will be NWB for about 2 to 4 more weeks after that. Then it’s another 4 to 6 six weeks in the boot and months of physical therapy. I’m blessed with both a high tolerance for pain (drove my stick home after the injury), and a generous employer. My company has been letting me work from home and encouraging me not to rush back, so at least disability won’t be part of the equation. I’d say the worst part so far, besides the initial post-surgery pain, is the need to keep the leg elevated. It hurts your rear-bone to always be sitting with your foot above your waist. Additionally, it stressful for me because I’m anal about putting things in their right place and am never comfortable sitting idle. My non-injured side of my body is sore from needing it to work much harder than it used to. I’ve become a world-class hopper and balance expert as well. I can do about 15 minutes hopping on one leg now, but I end up all sweaty as it’s quite the workout. Gator must do a lot of things for me, because it’s impossible to carry things when you are using crutches. I wear a back-pack which helps, but you can’t really cook, or clean the table or even get milk from the fridge. I am staying positive and am counting the minutes to getting the use of my left leg back. I just can’t believe how my life was completely turned upside down in such a surprising manor. I do appreciate your interest in my recovery. We must get together some day.

    ChiFi:
    Speaking of not being impressed by what your child’s teachers are teaching…I’m completely underwhelmed by Lil’ Gator’s kindergarten so far. Although he likes his teacher, school and bus, his homework is of the variety where his parents must do it with him and it’s more creative and less academic. We could tell on the first day of school that our son is significantly better prepared for elementary school than most of his classmates. The PTA is relentless in its pursuit to obtain donations which is kind of annoying as well. It’s bad enough that the services we receive for our property taxes are distributed overwhelmingly to meet the needs of the poor in our town, but this carries over to other areas such as after care enrichment, where the fees are outrageous, since they give so many spots away for needs based-scholarship. I suppose I need to take a chill pill, but it just plain stinks that my son is a knowledge sponge and so far, the school system is simply wringing him out.

    Now to the highlight of my week. Fantasy Football Sunday. I’m 3 and 0 in a 14-team league. If there is one positive that comes from being couch-bound, it’s that I have more time than ever to tweak my roster.

    Grim,
    I am 100% committed to purchasing in the Spring. I even told my tenants this was my plan. The only deterrent would be job loss, but I’m optimistic we’ll stay employed. Keep up the good work here. It really helps me pass time in a fun and educational way. I also like the way that for the most part, the participants here ignore the political loonies here.

  30. Mr Wantanapolous says:

    Juice [22],

    Worst possible scenario for Helicopter Ben; declining housing, stagnant wages, avg hourly work week at record lows, “real” unemploymemt over 20% and prices for necessities heating up. It’s back to Saturday Night Fever; slogflation.

  31. Mr Wantanapolous says:

    Loved the Record article. Idiots don’t realize that their first loss is their best loss. Stop complaining and hit the bid.

  32. Essex says:

    Mike! I’d be right there with you if work permit. 1 hour commute not gonna happen. Enjoy the wide open spaces and bucolic scenery.

  33. poor guy says:

    libtard

    speedy recovery! scks to go through this but remember it could have been worse

  34. Barbara says:

    Libtard,
    Thanks. It is not in Montclair, I’ll disclose if we get it. Put the offer in yesterday. To make the low ball sweeter, we said we would skip the inspection and all contingencies and we could close immediately. The realtor even said they would be fools not to take it. I have a feeling they will be fools.

  35. Libtard says:

    Surprising manor. I’m an idiot.

  36. Fast Eddie says:

    “The buyer population out there wants it for nothing, and they want all the bling,” said Elizabeth Sarkozi, a corporate tax manager who put her four-bedroom, 52-year-old Englewood Cliffs split-level on the market last February, asking $925,000.

    She expected it to sell quickly because of the town’s relatively low taxes and location near the George Washington Bridge. But although she has dropped the price to $899,000, she has not found a buyer.

    Sarkozi has not updated her house with all the extras some buyers seem to expect — whirlpool tubs in the bathroom, granite countertops in the kitchen. But she thinks they wouldn’t be happy anyway: “I’m convinced that even if I had granite countertops, they’d say, ‘You have gray — I wanted brown.’ “

    Here sweetie, here’s a box of kleenex and some chocolate ice cream for you.

  37. freedy says:

    Whats so special about englewood cliffs?

  38. Fast Eddie says:

    Barbara,

    If they decline, let the sellers know your offer drops $1500 per week. Let them know they’d be wise to accept or they risk being priced in forever. Let them also know that New York City is drifting away at a rate of 2 miles per week.

  39. Barbara says:

    Fast Eddie,
    even better, we are letting them know that if declined, we will be walking our coin over to the OTHER park front across the park that goes into the better elementary school.

  40. Barbara says:

    a million dollar 60s split level…..you couldn’t pay me to live in one. Unreal

  41. yo'me says:

    I can proudly wear my old NY Jets jersey with Esiason still on it.Thanks Mark Sanchez!!

  42. Shore Guy says:

    “a generous employer.”

    I hear they may even give you another job to do, they are so nice.

  43. Shore Guy says:

    “If they decline, let the sellers know your offer drops $1500 per week. ”

    Ahh, a negotiator after my own heart.

  44. Shore Guy says:

    “Gator must do a lot of things for me… [I] can’t really cook, or clean the table or even get milk from the fridge.”

    And the downside is?

  45. Shore Guy says:

    Gator,

    Are you going to get Stu a little bell to ring whenever he needs you to get something for him?

  46. Shore Guy says:

    “No bottom for the shore”

    The Shorte without bottoms is a very sad thing indeed.

  47. Shore Guy says:

    Shore, even

  48. 30 year realtor says:

    The Englewood Cliffs home in the Record article: There is a good comp about 2 blocks away, 15% smaller, all brick, similar condition, sold before the tac credit expired on 6/2/10 for $690,000. Subject is a tri-level split (one of the least desirable style homes known to man) with no master bath.

    Factoring for time and differences it is my opinion that the first number in the value of Ms. Sarkozi’s home is a 6! Value range $670,000 to $695,000 and decreasing by the day!

  49. Fast Eddie says:

    #49,

    I was going to post earlier that the house is at least $200,000 over-priced.

  50. Shore Guy says:

    With apologies to Cole Porter:

    Like the beat, beat, beat of the tom tom
    When the jungle shadows fall
    Like the tick,tick, tock of the stately clock
    As it stands against the wall
    Like the drip, drip drip of the rain drops
    When the summer showers through
    A voice within me keeps repeating
    Real estate sellers are fools

    Night and day
    Your home value drops
    And the value won’t bounce back
    Just like your stocks
    And wheather near to me or far
    It’s no matter darling
    Where you are
    I think of you
    Day and night
    Night and day
    And your absurd attempt
    To not give your house away
    While the value it holds keeps slipping away
    Day and night
    Night and day

  51. Essex says:

    I love my 50s tri level. Huge windows. No steep stairways. Great layout.

  52. Shore Guy says:

    “I love my 50s tri level. Huge windows.”

    There is always one in a crowd.

    Actually, the split levels are far superior to the 70′s bi levels — which are a pox on the landscaape.

  53. ricky_nu says:

    hi folks – I see a house in my neighborhood states something like this in the listong:

    “CONTRACTS,COMMISSIONS SUBJECT TO LENDER/3RD PARTY APPROVAL FOR FULL DEBT FORGIVENESS”

    which I suppose means short sale. Is there a way to look up or find out how much the mortgage is on the house (public records)?

  54. Shore Guy says:

    I know that NJC and others know where to look for mortgages. The cavaet is that all that those records show s the initial mortgage amount, not what remains.

  55. Buyer(formerly renter) says:

    We closed last week. Couldn’t live in this tiny place and couldn’t keep looking at houses for rent that were really for sale anymore.

    We bought it from an older couple for about 10% less than similar homes are listing for.

    Kids are over the moon with the yard.

  56. Toejam says:

    Mr Hyde says:
    October 2, 2010 at 1:50 pm

    Toejam

    the Toyota 4runner is probably the best SUB fir reliability overall

    Actually the Toyota Highlander ranked slightly ahead of the 4Runner, but the Pilot grades out better than both of them.

  57. Barbara says:

    56. Buyer

    congrats. Renting a house only to have potential buyers paraded through at any time wasn’t for us either.

  58. Buyer(formerly renter) says:

    thanks

  59. Revelations says:

    ricky_nu (54),

    Depending on your county, you may be able to perform an online search of records. Web search for “county clerk” and your county. Look for a heading for land records or property records. If not available online, you likely have to make a trip in person. If your financial well-being depends on an accurate records search, I would go in person anyway. Some properties (well, their owners, really) have some interesting histories, and it makes you wonder what the banks were smoking when they underwrote the loans.

  60. Comrade Nom Deplume says:

    Weekend Weirdness

    Saw some things today that struck me as strange, given the zeitgeist.

    First, at my daughter’s soccer game today, I saw a car in the parking lot with a plate holder that said “Who is John Galt?”

    Second, while at Lowes getting some plywood for a project, I saw a stack of plywood or chipboard that was covered in mossy oak. Yes, camoflauge plywood is now available at Lowes.

    Ordinarily, I would see these things and not give it thought # 2. But these days, I notice these things.

  61. Barbara says:

    Comrade
    every dolt that fancies themselves self sufficient boot strappers has just discovered Amazon.com and Ayn Rand within the last two years. Bad polemic is trending.

  62. chicagofinance says:

    The end is nigh….

    Whole Foods now has posted security in Middletown…..