Market Conditions in 07306>Question Details

Sonja, Both Buyer and Seller in Jersey City, NJ

Is Journal Square really up and coming? Is it a good time to buy there? Shall I buy as an investment and rent?

Asked by Sonja, Jersey City, NJ Tue Jun 24, 2008

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Hi Sonja,

Be careful of answers from "real estate" sales people, like those who answered your question -- they are all uneducated sales people who are hooked on this fantasy that property is a good investment and prices always go up. Be careful with "rent" assumptions, most investors are findig it very difficult to rent right now for reasonable income. Journal Square -- I would say its still a very rough neighborhood in parts -- it was a "up and coming" area in the boom economy years but could be very risky in the short term. I would wait until there was more signs the economic downturn has leveled off before investing in that area in particular.
My guess is it will be the hardest hit and the last to recover. In general, the best advice when looking at neighborhoods is to do the due diligence yourself. Check the crime stats, the local income and unemployment stats, visit the local police. The "sales people" who answer these ads are just fishing for business, they have no idea about economics and only want a quick sale. Be wary of these "professionals".

Also, be cognizant of the broader economic area and property market. In particular, the waterfront in downtown JC by Manhattan has seen a lot of growth in recent years. However, its a complete mess right now. Bear in mind, no local builders can get any loans, banks are lending and therefore the "development" stage is over for some time. I'm an international real estate investor and I've gotten burned in the NYC metro area. Bear in mind the Downtown Jersey City is flooded with unsold luxury condo properties. Most of these developers are about to cut prices dramatically -- which will have a knock on effect on all areas in the broader JC area, including Journal Square. Most of my hedge fund and private equity investor colleagues expect that the best parts of downtown Jersey City, eg. Paulus Hook, will "clear" when prices fall to around $250-320 per square foot. My guess is it will take until this time next year for that to happen. Also, a lot of investors like me are struggling to rent large inventories of units in the major luxury buildings. As I keep telling my clientele and investors "rents are falling, prices are falling, unemployment is rising..." don't be in a rush to buy. There will be interest to buy and redevelop these neighborhoods in coming years, but just not anywhere near current prices. Its not economical when banks won't lend and those that do are doing it at exorbitant interest rates. Builders in JC have been destroyed....
3 votes Thank Flag Link Wed Mar 4, 2009
If there's interest, I am selling my 3BR Condo that I just finished renovating!
There sure is a conflict of interest :), but I truly do think Journal Sq is a very up an coming area.
There are many conversions of existing homes as well as building of new ones. One important factor is the migration of Manhattanites into JC to get more space for the buck.

See my listing in the interim. http://www.postlets.com/res/1816544
0 votes Thank Flag Link Wed Feb 25, 2009
Sonja:

I am a real estate broker and cater to the Jersey City market. Believe it or not, Jersey City is still quite a stable investment. Because of its proximity to NYC and ease of transporation, people find it very desirable.

Please call me if I can be of assistance.

Diane Rivera
973-809-7045
0 votes Thank Flag Link Sun Jun 29, 2008
Journal Square is without a doubt one of the up and coming neighborhoods in Jersey City. And with the general market conditions right now, it is definitely a great time to buy! What you need to do is take a close look at the numbers on any property you are looking at, and make 100% sure it makes sense as an investment.

I work with a ton of investors, and I'll be happy to give you specific advice if you want.

--Bob
0 votes Thank Flag Link Fri Jun 27, 2008
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