New Jersey Contracts – August 2013

Posted on September 7, 2013 by grim

Here it is! The first look at pending home sales (contracts) for Northern NJ.

(Source GSMLS, except Bergen- NJMLS)

August Pending Home Sales (Contracts)
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Bergen County
August 2011 – 589
August 2012 – 715
August 2013 – 806 (Up 12.9% YOY, Up 36.8% Two Year)

Essex County
August 2011 – 255
August 2012 – 296
August 2013 – 413 (Up 39.5% YOY, Up 62% Two Year)

Hunterdon County
August 2011 – 92
August 2012 – 133
August 2013 – 154 (Up 15.8% YOY, Up 67.4% Two Year)

Morris County
August 2011 – 333
August 2012 – 442
August 2013 – 463 (Up 4.8% YOY, Up 39% Two Year)

Passaic County
August 2011 – 143
August 2012 – 213
August 2013 – 303 (Up 42.3% YOY, Up 112% Two Year)

Somerset County
August 2011 – 220
August 2012 – 321
August 2013 – 354 (Up 10.3% YOY, Up 61% Two Year)

Sussex County
August 2011 – 105
August 2012 – 139
August 2013 – 170 (Up 22.3% YOY, Up 62% Two Year)

Union County
August 2011 – 241
August 2012 – 258
August 2013 – 373 (Up 44.6% YOY, Up 54.8% Two Year)

Warren County
August 2011 – 80
August 2012 – 95
August 2013 – 130 (Up 36.8% YOY, Up 62.5% Two Year)

Posted in Economics, Housing Recovery, North Jersey Real Estate | 30 Comments

Mortgage rates could hit 5% today

Posted on September 6, 2013 by grim

From Mortgage News Daily:

Mortgage Rates at New 2-Yr Highs Ahead of Important Jobs Report

Mortgage rates leaped to new 2-Yr highs today, after strong economic data increased the chances that tomorrow’s all-important jobs report would be similarly strong. The rate with the most efficient combination of upfront cost and monthly payment for ideal scenarios (best-execution) moved up to 4.875% for Conventional 30yr Fixed loans on average–roughly an entire eighth of a point in a single day. While some some lenders remain at 4.75%, others are closer to 5.0%–a rate that will be more prevalent if tomorrow’s data is strong.

In thinking about how much rates have moved so far this week, it’s important to note that the most widely used metric for changes in rates–Freddie Mac’s Primary Mortgage Market Survey–relies on data collected from Monday through Wednesday of any given week. Lenders who participate in the survey are emailed Monday and asked to respond by Wednesday. This can result in a delayed response in Freddie’s data vs reality.
…
Unfortunately, rates are very capable of going even higher–something we warned about in no unspecific terms yesterday. At this point in the day, there’s little that can be done to lock in a rate before tomorrow’s excessively important jobs data arrives. In that sense, it “is what it is,” but for the sake of mental preparation, rates can still go higher if the data is strong, and the movement can still be big. If we happen to be benefiting from weaker-than-expected data tomorrow, we’ll cross that bridge if we come to it.

Posted in Economics, Housing Recovery, Mortgages, National Real Estate | 60 Comments

Newark-Union leads the state in home price gains

Posted on September 5, 2013 by grim

From the Star Ledger:

Home prices in New Jersey continue to rise

The price to buy a home in New Jersey Home continued to climb in July, according to CoreLogic, rising by 4.1 percent over last year. The increase includes homes in which homeowners were behind in mortgage payments or in default.

Nationwide, the average home price rose 12.4 percent between July 2012 and July 2013, the monthly report said. Arizona and California led the way, with jumps of 27 percent and 23.2 percent respectively. It marked the 17th consecutive monthly year-over-year increase.

New Jersey’s increase was the 33rd highest in the country.

“Home prices continued to surge in July,” Mark Fleming, chief economist for CoreLogic, said in an e-mail. “Looking ahead to the second half of the year, price growth is expected to slow as seasonal demand wanes and higher mortgage rates have a marginal impact on home purchase demand.”
…
The Newark-Union area outperformed the state as a whole, with a 5.9 percent increase in July 2013 compared to July 2012. On a month-over-month basis, home prices increased by 3.5 percent between June and July.
..
It noted the median price of home in the Newark-Union metropolitan area was $398,000, up 3.2 percent in the quarter. In the area surrounding Edison, the median price was $299,800, up 0.8 percent.

Posted in Housing Recovery, New Jersey Real Estate | 95 Comments

Home prices continue to show strong gains, but moderation expected

Posted on September 4, 2013 by grim

From HousingWire:

Home price appreciation flame begins to weaken

Home data reports from both CoreLogic and Clear Capital released Tuesday project continued home price growth, despite the recent increase in mortgage rates.

According to the CoreLogic report, home prices throughout the country rose 12.4% year-over-year in July, marking the 17th consecutive month of annual growth in home prices. Clear Capital’s report posted a 10.2% increase in home prices year-over-year; however, this report was for August, not July.

Nonetheless, both reports point toward strong home price appreciation. According to Clear Capital, the last time double-digit yearly price growth was reported was mid-2006, the height of the bubble.

On a monthly basis, home prices, including distressed sales, increased by 1.8% in July, CoreLogic reported. In its home price index, CoreLogic analysts predict that home prices will rise by 12.3% year-over-year in August, with a 0.4% monthly increase — implying a slowing in price gains.

“Home prices continued to surge in July,” said Mark Fleming, chief economist for CoreLogic. “Looking ahead to the second half of the year, price growth is expected to slow as seasonal demand wanes and higher mortgage rates have a marginal impact on home purchase demand.”

Posted in Economics, Housing Recovery, National Real Estate | 43 Comments

Is New Jersey getting richer or poorer?

Posted on September 3, 2013 by grim

From the Record:

New Jerseyans who moved out of state took $15.7 billion in income from 2000 to 2010

New Jerseyans who moved to other states took a net total of $15.7 billion in income with them from 2000 to 2010, according to a new tax map from the non-partisan Tax Foundation.

That meant they weren’t spending that money, or paying taxes on it, in the Garden State.

But the loss in population and income was more than offset by births and the influx of immigrants to New Jersey, which has historically been an immigration gateway. And its household incomes remain among the highest in the nation.

For decades, more people have moved out of New Jersey to other states than the reverse. Starting in the 1970s, “the nation’s population and job growth increasingly shifted to the Sun Belt states of the South and West,” according to Rutgers economists James Hughes and Joseph Seneca, who have studied the issue. In a 2007 Rutgers report, the economists wrote that in 1970, the mid-Atlantic states of New Jersey, New York and Pennsylvania accounted for 18.3 percent of the nation’s population; by 2006, they accounted for 13.5 percent.

One big reason has been retirement to Florida and other warm-weather states. Other factors are the state’s high cost of living, especially high housing costs and property taxes; and faster job growth in other states, which was “a magnet for young people,” Hughes said last week.

New Jerseyans’ moves across state lines slowed dramatically during and after the 2007-09 recession, as mobility nationwide declined. There were two main reasons: plummeting home values made it hard for people to sell their homes, and high unemployment around the nation made it unlikely that job hunters would find better prospects in other states.

Households have started moving out of New Jersey again, however, as the economy and housing market continue their recovery, Hughes said. Many have found more job opportunities elsewhere; while the Garden State has recovered only 60 out of every 100 jobs it lost during the recession, Texas, for example, has recovered two jobs for every one it lost.

According to the Tax Foundation, from 2000 to 2010, the top states for New Jerseyans to move to were Florida, New York, Pennsylvania and California. The biggest source of people moving into New Jersey was New York.

Posted in Demographics, Economics, New Jersey Real Estate | 87 Comments

Home purchases post another strong month

Posted on August 31, 2013 by grim

From the Otteau Group:

July Purchase Activity Shifts Back in to High Gear

Home purchase demand in New Jersey shifted back in to high gear with another double digit-increase. In July, signed purchase-contracts rose by 21% compared to one year ago. This follows a smaller increase in June as rising home prices and mortgage interest rates caused a pause in buying activity.

Posted in Economics, Housing Recovery, New Jersey Real Estate | 29 Comments

Negative equity falls, still a long way to go

Posted on August 30, 2013 by grim

From CNBC:

Home values rise, but millions still drown in debt

More than three million U.S. borrowers have risen above water on their mortgages so far this year, thanks to swift home price appreciation, according to a new report from online real estate company Zillow.

The negative home equity rate fell in the second quarter of this year, the fifth straight quarterly drop, but it is still alarmingly high and continues to hamper the housing recovery.

Currently, 23.8 percent of homeowners with a mortgage, or approximately 12.2 million, owe more than their homes are worth, down from 15.3 million one year ago, according to the report. Some, however, are still so far underwater that even with fast-rising prices, it will take years for them to see any home equity.

“Widespread rising home values during the past year have helped chip away at negative equity nationwide, helping many homeowners who were only modestly underwater to come up for air. For those homeowners who are deeply underwater, though, there is still a long row to hoe,” said Zillow Chief Economist Dr. Stan Humphries in a release.

Nationwide, more than half of all underwater borrowers are in in the red by 20 percent or more, and roughly one in seven owes more than twice what their home is worth.

The numbers seem incredible, given that home prices are up about 12 percent year-over-year, according to the latest S&P/Case-Shiller home price index for June, but that same index shows prices nationally are still off 23 percent from their peak in 2006. In some of the hardest hit housing markets, home values are still down around 30 percent from their recent peaks.

“Negative equity will be a factor in these markets for years to come, constraining the supply of homes for sale and keeping people out of the market who might otherwise get involved,” said Humphries.

Posted in Economics, Foreclosures, Housing Recovery, Mortgages, National Real Estate | 67 Comments

Anyone surprised?

Posted on August 29, 2013 by grim

LISTEN UP!

Clear your calendars now, I don’t care what you committed to.

Today – 6:30 PM — Montecristo Lounge at J&R Cigars, 301 Route 10 East, Whippany, NJ 07981

No excuses.

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From the Washington Post:

Regulators relax proposed mortgage rule

Federal regulators on Wednesday softened a proposed rule that would require banks to keep a stake in home loans that they parcel out to investors, for fear that the policy would disrupt the nascent housing recovery.

The move will likely quiet the outcry from industry groups and housing advocates who have cautioned against strict rules that could freeze home buyers out of the market. Banks have warned that a pile-on of new mortgage regulations would raise their costs and ultimately make it more difficult or expensive for consumers to get a loan.

In response, six agencies, including the Federal Reserve, have loosened the definition of the types of home loans — known as qualified residential mortgages or QRM — that are deemed secure enough to be exempt from the extra requirements.

Regulators initially defined qualified residential mortgages as those with at least a 20 percent down payment and no more than a 36 percent debt-to-income ratio. That 2011 proposal raised fears that the definition was so strict that it would limit access to credit for low- and moderate-income Americans.

The new 505-page proposal has eliminated the down-payment requirement and raised the debt-to-income ratio to 43 percent. On loans that do not meet that threshold, banks and bond issuers will have to keep a 5 percent interest in the mortgages as they get bundled into securities for investors. That’s to make the banks retain some of the risk and prevent a repeat of the shoddy mortgage securities created during the financial crisis.

Posted in Foreclosures, Politics, Risky Lending | 48 Comments

June home prices up 12% YOY – Much smaller locally

Posted on August 28, 2013 by grim

From Forbes:

Home Price Growth Beginning To Slow Down, Says S&P/Case-Shiller

Home prices continued their upward march in June, if at a slightly slower pace.

U.S single-family home prices in 20 metropolitan areas rose a seasonally-adjusted 0.9% in June from a month earlier, according to the S&P/Case-Shiller Home Price Index, after rising 1% in May.

The gain puts home prices 12.1% higher than they were a year ago, as all 20 metro areas welcomed price increases on both a monthly and annual basis, led by Las Vegas (24.9%) and San Francisco (24.5%). S&P/ Case-Shiller’s 20-city composite index also posted a 7.1% increase in the second quarter and a 10.1% increase over the past four quarters.

Yet the biggest takeaway from the new report is the fact that the pace of home price growth is showing signs of slowing down, as rising mortgage rates begin to weigh on home sales. Thirteen of the 20 cities saw their returns weaken on a monthly basis.

“Overall, the report shows that housing prices are rising but the pace may be slowing,” says David Blitzer, chairman of the Index Committee at S&P Dow Jones Indices. “As we are in the middle of a seasonal buying period, we should expect to see the most gains. With interest rates rising to almost 4.6%, home buyers may be discouraged and sharp increases may be dampened.”
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“I think there is a risk of a softening housing market,” warned Robert Shiller, Yale economics professor and co-creator of the Case-Shiller home price indexes, on CNBC Tuesday morning. He noted that housing has been a “speculative market” thanks to the prevalence of real estate investors that include Wall Street institutions and house flippers. Last week he warned that rising rates will hurt home prices as the increasing cost of borrowing cuts into buyer demand.

Still, news that the home price surge may be slowing isn’t necessarily unwelcome. Economists like the National Association of Realtors’ Lawrence Yun have warned that prices have been rising “too fast” and at these double-digit rates of appreciation are “unsustainable”.
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Economists and real estate experts don’t expect rising rates — or any other factor of “stabilization” — to derail the housing recovery. Trulia chief economist Jed Kolko notes that home prices are still low relative to rents in every major city across the country: a 30-year fixed mortgage at a rate of 4.5% with 20% down means it is still more than a third cheaper to buy a home than rent one on average nationally. “Not every market will remain cheaper to buy but on average across the U.S., buying will stay cheaper than renting until rates reach 10.5% — a level we haven’t seen since 1990,” Kolko recently explained in an interview with FORBES.

He says the first market that will tip in favor of renting is San Jose, Calif., when rates hit 5.2%. Behind that San Francisco, New York, and Honolulu will follow, at just under 6%.

CoreLogic chief economist Mark Fleming has also crunched affordability numbers. Nationally, at the current rate of price growth versus median income growth, mortgage rates would have to hit 6.5% before housing becomes less affordable than economic fundamentals could support.

Posted in Economics, Housing Recovery, National Real Estate, New Jersey Real Estate | 78 Comments

Hammers swinging, multifamily rentals hot

Posted on August 27, 2013 by grim

GTG Alert –NJRER GTG now scheduled for Thu 8/29 from 6:30 PM ’til whenever; venue — Montecristo Lounge at J&R Cigars, 301 Route 10 East • Whippany, NJ 07981 (973) 887-0800 (http://www.jrwhippany.com/index.cfm?page=lounge).

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From the Record:

Rental properties spark leap in N.J. housing activity

Home-building activity in New Jersey has risen 32 percent so far this year, propelled by construction of rental apartments — another sign that the housing market is healing.

Through July, the state had issued building permits for 13,234 housing units in New Jersey, compared with just over 10,000 for the same period last year, the U.S. Census Bureau reported Monday.

“There’s an acceleration in activity,” said Patrick O’Keefe, an economist with CohnReznick, an accounting firm with an office in Roseland. “While we’re not back to the go-go days of 2005, we have gotten back to a more sustainable pace.”

The state is on track to start more than 22,000 housing units this year — above the nearly 18,000 begun last year, but below the housing-boom peak of 38,588 in 2005, and under the historical average above 30,000.

Multifamily construction accounts for more than 57 percent of the state’s permits so far this year. That has been the trend in recent years, as demand has climbed for rentals in the face of foreclosures and tighter mortgage lending standards.

Bergen and Hudson counties are the busiest construction markets in the state, with projects that include the Modern, a 47-story high-rise in Fort Lee that’s part of that town’s long-delayed downtown redevelopment; an AvalonBay building in Hackensack, next to the Shops at Riverside; and new buildings in Edgewater and Fair Lawn, as well as along the Hudson River in West New York.

Russo Development of Carlstadt is building a 296-unit apartment complex a half-mile from the Kingsland commuter train station in Lyndhurst.

“Multifamily is where the demand is now,” said Russo spokeswoman Lisa Sikora. “We’re seeing a lot of twenty-somethings who, before, only wanted to live in New York City or along the [Hudson River] Gold Coast. We’re seeing that demographic become more comfortable near a train station but with a more suburban lifestyle.”
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ince the housing bust, “we’re just seeing that a lot of people don’t feel comfortable buying; they’d rather rent than own and take the risk of losing their equity,” said Joseph Langan, president of River Drive Construction. In addition, he said, mortgage underwriting standards are so tight that many people who’d like to buy can’t qualify for a loan.

Banks are generally much more willing to lend builders money to put up rentals, rather than for-sale homes, Langan said.

Last year, about 18,000 housing permits were issued in the state, an increase over the 13,000-a-year average that prevailed from 2009 to 2011. About 12,400 units were built in 2009, the fewest since World War II.

Nationally, home permits are running about 25 percent ahead of last year’s pace. About one-third have been for multifamily units.

The rebound in home building is not the only sign that the housing market is recovering from the worst bust in decades. Home prices are also rising in the state, although not as quickly as in the nation as a whole, O’Keefe pointed out.

“We’re recovering more slowly, but the momentum is at least in a positive direction,” he said.

Posted in Economics, Housing Recovery, New Development, New Jersey Real Estate | 91 Comments

NJ “not bad” for retirement, if you don’t have to pay property taxes

Posted on August 26, 2013 by grim

From the Star Ledger:

New Jersey isn’t ‘tax friendly’ for retirees, study shows

It’s no secret that New Jersey is not the friendliest place for retirees. It’s not the weather, the highways or even the politics. It’s the taxes.

A Kiplinger study released last week ranks New Jersey 41st when it comes to tax-friendliness for retirees. It could have been worse. Rhode Island tops the list as the least-amenable state, followed by Vermont, Connecticut, Minnesota and Montana.

“New Jersey is not that bad,” said Sandra Block, senior editor at Kiplinger’s, a financial publication.

“There are actually some aspects that are tax friendly,” she said. “New Jersey does exempt a lot of retiree income. It’s pretty generous in this respect. But property taxes are a real problem.“

According to the Tax Foundation, New Jersey has the second-highest state and local tax rate in the country, with more than 12 percent of income going to pay one tax or another. Income taxes alone for the wealthiest in New Jersey are 8.97 percent.

Property taxes vary by municipality, but with the median price of a home at $348,300, the median tax is $6,759, according to the Tax Foundation. Seven of the top 10 counties nationwide with the highest median real estate taxes are in New Jersey.

The math is simple for someone looking to get the most from their retirement funds. The median sale price of a home in the Miami-Dade area of Florida is $320,000, according to Zillow, a real estate firm, and the taxes are $4,200. That’s a $2,500 yearly savings on property taxes.

Posted in Economics, New Jersey Real Estate | 70 Comments

Getting better everywhere but here?

Posted on August 23, 2013 by grim

From the Philly Inquirer:

U.S. jobless claims dip, but Pa., N.J. still struggle

For the first time since the start of the recession in late 2007, the number of people filing initial claims for unemployment insurance in the month fell to 330,500 a week on average, the U.S. Labor Department reported Thursday.

The news buoyed Wall Street, but the national story isn’t what’s happening in the Philadelphia region.

“Philadelphia’s economy has struggled this summer,” said Ryan Sweet, an economist with Moody’s Analytics in West Chester.

The last time the national number was so low was in November 2007 – the month before the official start of what economists have described as the worst recession since the Great Depression.

“The economy seems to be picking up some steam as the labor market continues to improve,” said economist Joel Naroff of Naroff Economic Advisors in Bucks County.
…
Pennsylvania and New Jersey were identified in the report as two of 10 states with the highest unemployment among those covered by unemployment insurance.

“Philadelphia has taken a beating and has taken a while to recover,” said Sweet, who specializes in Pennsylvania’s economy.

“I think, going forward, that it will begin to heal more quickly,” he said.
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In New Jersey, July’s unemployment rate dropped to 8.6 percent from 9.7 percent a year ago and 8.7 percent in June.

Pennsylvania’s unemployment rate has remained at 7.5 percent for the last three months, but is down from 8.1 percent a year ago.

In New Jersey, hiring increased in every sector over the year, but declined in most sectors over the summer.

In South Jersey, “it’s a problem in manufacturing,” said Sohini Chowdhury, the Moody’s Analytics economist who specializes in New Jersey.

North Jersey’s mainstay – the financial industry – saw increased hiring in the summer.

Posted in Economics, Employment, Housing Recovery, New Jersey Real Estate | 125 Comments

July home sales up 17%, hit 4 year high

Posted on August 22, 2013 by grim

From Bloomberg:

Sales of U.S. Existing Homes Rise to Highest Since 2009

Sales of previously owned U.S. homes jumped in July to the second-highest level in more than six years as buyers rushed to lock in mortgage rates before they increased any more.

Purchases advanced 6.5 percent to a 5.39 million annual rate last month, beating the 5.15 million median forecast of economists surveyed by Bloomberg, figures from the National Association of Realtors showed today in Washington. Sales were the strongest since a government tax credit temporarily boosted demand in November 2009, and second-highest since March 2007.
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“Housing will be an important part of the recovery through the rest of this year and into 2014,” said Gus Faucher, senior economist at PNC Financial Services Group Inc. in Pittsburgh. PNC is the most accurate forecaster of existing-home sales over the past two years, according to data compiled by Bloomberg. “We have a better labor market and improved confidence, so the underlying demand is there.”
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The 6.5 percent jump in demand last month from June would be the biggest since January 2002, excluding the periods in 2009 and 2010 that were influence by the government homebuyer tax credit and its extension.

Compared with a year earlier, purchases increased 17.2 percent in July on an adjusted basis, today’s report showed.

The surge in demand also boosted property values as the median price increased 13.7 percent in July from a year earlier, the most since October 2005. It climbed to $213,500 last month from $187,800 in July 2012.
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There were 2.28 million homes for sales in July, up from 2.16 million a month earlier, according to the report. At the current sales pace, it would take 5.1 months to sell those houses, the same as in June. The inventory was down from 2.4 million a year earlier, and the lowest for any July since 2002.
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“It’s not unusual, when you see a spike in mortgage rates, to see a couple months later a spike in closed sales,” said Lawler, a former senior vice president at Fannie Mae in Washington. “People saw the beginning of the trend and accelerated their pattern of buying. In all likelihood, within a month or two, you’re likely to see the pace of sales slow.”

Existing-home purchases are recovering from a 13-year low of 4.11 million reached in 2008. Annual sales peaked at 7.08 million three years earlier. A total of 4.66 million previously owned houses were sold in 2012.
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Sales climbed in all four U.S. regions, with the biggest gain in the Northeast.

Posted in Economics, Housing Recovery, National Real Estate | 126 Comments

Cashing out at the top?

Posted on August 21, 2013 by grim

From Bloomberg:

The Housing Market Is Hot, So Re/Max Is Going Public

There’s money to be made in real estate again, and one of the big names in the industry is eager to catch the boat. Re/Max Holdings, the franchiser of real-estate brokerages, filed papers today to go public, hoping to turn the rebound in the U.S. real estate market into a successful payday as a publicly traded company.

If it’s completed, Re/Max’s public offering would become at least the third big IPO in the sector in the past year. To review: Realogy Holdings (RLGY)—parent of Century 21 and Coldwell Banker—went public in October, raising more than $1 billion. The stock has gained 58 percent. Trulia (TRLA) went public the same month and raised more than $100 million. Its shares are up 172 percent this year. Shares of establishment player Zillow (Z) (IPO: July 2011) are up 214 percent this year.

Re/Max: Us too, please.

From the NYT/Dealbook:

To Cover New York, Zillow Buys a Rival Site

It is the parlor game that has long been played in Manhattan’s upper social circles: guessing how much so-and-so paid for their apartment, and how nice it is.

That information, once closely guarded by real estate brokers, has become much easier to find in recent years, thanks largely to StreetEasy.

On Monday, the seven-year-old start-up is expected to announce that it has sold itself to Zillow, the giant of online real estate information, for $50 million in cash.

Though tiny, the acquisition will give Zillow a huge lead in one of the nation’s most desirable markets as it battles rivals like Trulia and Redfin amid a resurgence in real estate sales.

Both Zillow and Trulia have turned to acquisitions to help gain an edge. Trulia paid about $310 million in cash and stock this spring to buy another rival, Market Leader, in one of the biggest deals by far in the industry.
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“New York is the biggest real estate market in the country,” Mr. Rascoff said. Calling himself jealous of his smaller rival’s success, he added, “It’s just a much better product in New York.”

StreetEasy’s strength led Zillow to hold more than three years of talks with its smaller rival.

Posted in Housing Recovery, National Real Estate | 200 Comments

Gold Coast Renaissance (Take #3)

Posted on August 20, 2013 by grim

From the NYT:

Have New Yorkers finally discovered Jersey City?

As property values soar even in Brooklyn neighborhoods once viewed as on the fringe, New Yorkers are looking across that other river that separates Manhattan from the rest of the world: the Hudson. And some of them are heading to Jersey City, which has a flintier personality than Hoboken, its preppy neighbor to the north. New Jersey’s second-largest city, it now has a branch of the popular Williamsburg arcade-bar Barcade; farm-to-table restaurants; and a new mayor who worked for Goldman Sachs, served in Iraq and rappelled down a skyscraper.

Jersey City has long attracted the Wall Street crowd to its splash of waterfront high-rises that promise cheaper rent and a speedy ride to Manhattan. But for years, the rest of the city was an afterthought with a reputation for high crime, failing schools and a lack of night life. But as the economy and housing market improve, other Jersey City neighborhoods are enjoying newfound attention, with boutique storefronts opening and New Yorkers steadily moving in.
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“Jersey City is good for 30- to 40-somethings who aren’t interested in hanging out in Williamsburg anymore,” said Kevin Pemoulie, the former chef of Momofuku Noodle Bar, who last year along with his wife, Alex, opened the restaurant Thirty Acres in the Van Vorst Park neighborhood. He, like many others who have moved to Jersey City, also liked the in-transition quality of the area.

With New York City rents reaching new highs, housing prices by comparison are still reasonable in Jersey City. The average rent here was $1,900 a month during the second quarter of the year, according to data provided by Trulia. In early July, the average listing price for a home downtown was $604,000 and in Hamilton Park was $426,000, according to data provided by Liberty Realty.

Richard LeFrak, chief executive of the LeFrak Organization, which began developing the Newport neighborhood in 1986 when it was rail yards and warehouses, is one who has noticed a change. “I would say, in the last three years, when you say you live in Jersey City,” he said, “people don’t look at you like there’s something wrong with you.” In the next decade, LeFrak plans to add condos, a hotel and an outdoor swim club to Newport.
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“Brooklyn is just ridiculous — it’s expensive,” Mr. Pemoulie said. “It’s frustrating to be there. All of my friends ended up moving out.”

Indeed, some parts of Brooklyn have even eclipsed Manhattan in rent prices. The average rent for a one-bedroom in Williamsburg in July was $3,155 a month, a price point rivaling those of many Manhattan neighborhoods, according to a market report by MNS. Even less-developed Brooklyn neighborhoods are commanding a premium: in Bushwick in July, the average rent for a one-bedroom was $1,900.

Still, for many New Yorkers, crossing the Hudson is a psychological hurdle, even if Jersey City now has a Two Boots Pizza and a coffee shop that serves Blue Bottle Coffee.

“The PATH train is like the train to Hogwarts,” said Kip Jacobson, 41, alluding to the “Harry Potter” series. Mr. Jacobson moved to the Van Vorst Park neighborhood from Williamsburg a year ago with his wife, Samantha, and their young son.
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Developers are building, and not just along the waterfront. Citywide, 2,610 units of housing are under construction and 11,405 more have been given the green light, according to the mayor’s office. In fact, the city has enough developable land available to fill all of Hoboken, which is one square mile. But the construction is still not keeping pace with demand. In July there was only a two-month supply of available homes downtown, according to Liberty Realty.

“If you see a vacant building in Jersey City,” said Joseph V. Covello, the owner of Liberty Realty, “someone is bidding on it or renovating it.”

Posted in Economics, Housing Recovery, New Development, NYC | 97 Comments