With all the layoff in Wall Street and the bigger ones still to come I still don't understand how prices can still be so high. My perception is that we should see at least a 15/20% decrease from what people is asking now just in few months. I was in Hamilton Park this week end and OMG most of the places are for sale. Prices are still high but when the offer is so big , shouldn't they come down ? Hey that's just my opinion, I boud be wrong but I definitely will not pay more than 320/350xsqft on a 2 bedroom apt condo, and for now prices are more around 400.
I do put "Wall Streeters" here, but I think we also get a fair number of entertainers, conglomerate employees,
airlines, chefs, artists, commodity traders and medical students. The Heights sale prices are not usually what
the properties finally sell at now. But it is not so off as to be evidence of further significant decreases. Because the Heights has so many houses as opposed to condos, the real estate stays much more steady in its value.
Condos on the waterfront and elsewhere are always more volatile because they are not on any real land, are not freestanding, and other reasons. Because of the low interest rates, your prices are effectively very low now. I think it is the best time since 1996 to buy here, and the neighborhood is much improved.
The Heights is the lowest crime police district in the whole city. It is a large city, 2nd highest population in Jersey, so the incidence of crime appears greater in Jersey City as a portion of Hudson County. It covers much of the County in land mass. Ask a policeman where most cops and teachers live in JC.
The McNair High School in JC consistently ranks #2 in quality in the NJ State Board of Education reports.
If you were to deposit $30,000 into a CD at the bank these days, you would earn less than 1% rate of return on your money, with no tax shelter benefits either. So real estate simply makes pure sense: (a) provides you with a place to live, (b) accumulates equity over time by paying down debt, (c) provides you with a leveraged investment growing at least at the rate of inflation as a rate of return.
Overall, it makes sense to buy if you are buying for the long term: 5 to 10 year time horizon. The price drop is irrelvant if interest rates rise, which in my opinion, they wil, because we have lost manufacturing jobs so to increase our stake in the global economy, our currency must rise in value relative to other currencies or to curb creeping inflation and that means higher interest rates. So don't wait for another 3% or 4% price drop, as an intererest rate rise is just around the corner in my opinion. Buy now, while you have both low prices and low interest rates.
Overall, I'm a firm believer that real estate will recover. I think it works in 12 year cycles: A 12 year rise followed by a bust, and then it has to bottom out to get healthy again and start rising again.
We have seen the S&L scandal of the 1980's. It took until 1992 to recover from 1980. Then from 1992-2001 things were moving along nicely. We then had the DOT com bust of 2001 and massive job layoffs. However, because the real estate market was hot, if fueled consumer spending and from 2001 until 2007 we saw meteriotic growth, doubling, sometimes tripling in values. So if you do the math, 1992-2007 was also about 12 years as well, 15 to be exact, but around that magic 12 year number I mentioned.
So essentially: 1981-1992 First Cycle. 1992-2005 next cycle. 2007-2019 next cycle. So I predict if the peak was 2007 then 5 years from that is 2012 is the year of stabilization and 2012-2019 is the year of fantastic growth.
In fact, hoping for prices to go even lower is not a good thing for you as a buyer, despite what you think. You see, as prices go lower and lower, homeowners that sell to you have negative equity, and are only selling because they have to, not because they want to. those that are not in trouble will hold out. Those that sell now have no place to buy because they have no equit to buy with. It erodes our overall economy, this housing market. We had a crash in the 1980s'. We picked up again by 2000-2005. We had a dot-com bust in 2001, we picked up again by 2007. We ha drecessions before.But over time, real estate holds is value. It doesn't drop to zero value.
Don't listen to the media hype. If you can afford it and can buy, buy now! Buy to live in it, not taking into account all this media hype and as long as you can hld on to it, you'll be fine in 5 to 12 years from now in terms of aprecition.
For just New Jersey
Jersey City is expected to drop by 9.3% next year according to this forecast. Look and see why they think this.
Be very careful when you buy. Taxes are killers in NJ. I saw one respected realtor say on a $200k house you would pay over $6k in taxes. Different cities will have different rates, (so compare taxes by city) but that is moving time when I see that amount of taxes on a place.
Completely wrong. Wall St layoffs affect higher end buyers. Once they stop buying, all the industries that support them turn down. People who buy in the Heights or Journal Square work in those industries and start losing their jobs. That will kill values in the rest of Jersey City. For the immediate future, there's really nowhere to go but down.
Low mortgage rates will slow the descent, but will not stop it. Condo prices in Jersey City will probably continue to drop throughout 2009. Nobody knows for sure, but predicting any rise in view of the bad job outlook, difficult lending environment, and general economic malaise makes no sense.
And please stop generalizing about my profession, everyone who works in it is an individual. I'm sure there are good and bad practitioners at whatever you do for a living also.
I'm specifically looking into buying a condo in Paulus Hooks , Hamiltomn Park etc. and there is so much offer in the market. I just drive around and it looks like everything is for sale. prices, still are very high, that's why I believe that there is a 15/20% margin of adjustment. I don't believe so much in brokers but if you just talk with some you will feel that any offer 10/15% lower than the listing price would be accepted.
Again, this is just my perception and my opinion .
The bottom line is you need to do your homework to make sure the home/condo asking price isn't overvalued anywhere you buy. The heights is not a 'full service' neighborhood...no starbucks, bars, restaurants, high end stores, etc. However it's a quick commute into the city or Hoboken and you'll get much more value for your money than in downtown JC or Hoboken. The Journal Square are in particular is developing rapidly and will be radically different in 5-10 years.
and dont even mention the hieghts i dont know what is there to command those substantial increases yes its close to nyc but the school sucks parking sucks there is nothing to do there and the dump called palisades avenue is a nightmare to drive on during rush hour do your self a favor and wait cash is gold prices will decline dont listen to some of these realtors just go to realtor.com and search jersey city there is over 3000 listings with that many houses its years for them to absorb all those units which means many foreclosures to come the wall street bail out will not change the market if you cant pay your mortgage because you dont have ajob or your house poor you will still loose the house so foreclosures will continue and prices will continue to correct
I am a mortgage lender in NJ and I can tell you that mortgage rates came down considerably today. If rates continue to drop the home prices will begin to rise. This is the first time in history that home prices and mortgage rates are low. Hope this helps.
Apex Mortgage Lending
Good luck to you!