Market Conditions in 07030>Question Details

Michael Wall…, Home Buyer in Hoboken, NJ

How much have prices dropped in Hoboken since last year, or even since beginning of this year?

Asked by Michael Wallace, Hoboken, NJ Tue Apr 7, 2009

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Hi Michael. The answer is really dependent on the type of property. Existing homes prices have dropped an average of 9% since a year ago, with about 5% just since January '09. It took a little while for the Sep/Oct. market crash to trickle down. However new construction pricing near the waterfront didn't suffer as much, with places like Harborside Lofts, Maxwell Place, the W, and Garden Street Lofts not taking much of a price hit (2%-5%).

Pricing, however, doesn't accurately reflect depreciation. Most places don't sell for asking price, so the numbers are a bit skewed. Sold prices vary much more based on particular scenarios. Let me know and I'll be happy to elaborate.

Thanks.

Eric J.
1 vote Thank Flag Link Tue Apr 7, 2009
All these people are full of BS and want you to think now is a good time to buy and things are not as bad as they seem. or will be over the next 2 - 2.5 years. Save your money let the other suckers ponder whether its a good time to buy or not buy and sit on the sidelines and wait until you can buy in cash and never need a mortgage. This time will be coming soon to a theater near you. Think of it this way. Banks state that homeowners should pay 3x their annual income for a home. The annual income for a home in Hoboken is $62,000. Well now look at the average prices in Hoboken coupled with the fact that 22% of employees in Hoboken are in the finance sector (hardest hit sector in NYC) coupled with the fact that the rate of foreclosures are going up the greatest in PRIME borrowers due to increasing unemployment, coupled with the fact that the declines have just begun. Me thinks you should be able to get yourself a nice 2 bedroom in Hoboken for about 400K in 2 years once the 30% decrease takes effect.
0 votes Thank Flag Link Thu Apr 30, 2009
Michael,

I see you say your neighbor has been trying to sell her place direct. If you mean for sale by owner, that may be the biggest problem. FSBOs don't get enough exposure, especially if they are not cooperating with agents. It's not as easy as placing an ad on Craig's list.

Eric is right regarding buying up in a down market. All prices come down and go up together. You will likely pay as high a percentage increase for you new places as you earn from your old place. So if your new place is going to be bigger and more expensive now is the time. Now is not the time to downsize however. Timing the market is rarely a profitable move.

Andres Garcia
Sales Associate, CDPE
RE/MAX Gold Coast Realty
56 Newark Street
Hoboken, NJ 07030
Direct: 201 795-5200 x340
Andres@MileSquareRealty.com
http://www.MileSquareRealty.com
0 votes Thank Flag Link Wed Apr 22, 2009
Michael- I heard that property taxes in Hoboken are supposed to increase substantially...
Somewhere between 23% to 47%. If that's true ...then... that would certainly effect values and marketability.
Web Reference: http://www.321advantage.com
0 votes Thank Flag Link Mon Apr 13, 2009
There could be many reasons why your neighbor's place isn't selling, but price is usually the main one. It could be a combination of poor marketing, bad presentation, high price, and small buying-pool. Send me details of the property and I'll give you my analysis.

Regarding yours, be careful with trying to time the market. Remember that when prices go back up, you'd actually end up paying a higher difference to upgrade. Example: The extra $40K you'd make next year, if the market's better, will be outdone by the extra $70K you'll pay (buying next year vs. now) for the bigger and better home.

Either way, let me know what you decide to do.

Best,

Eric J. Diloné
Realtor Associate
HALLIBURTON HOMES : Redefining Great Service!
Direct: 646.387.8012
Office: 201.792.4300
eric@halliburtonhomes.com
0 votes Thank Flag Link Sun Apr 12, 2009
Thanks for your answers. Seems to me that prices still have a bit of a ways to drop some more before rising again. I don't know if I agree with interest rates going back up when prices go up, but I figure it'll be a while before that happens and there has to be some lag time in between. My neighbor's been trying to sell her place direct and it's been 4 months and no offers. Same condo as mine, and I thought she was letting it go for cheap. Where are the buyers? I thought it was a buyer's market. Hopefully I can sell for a decent price next year and still buy something bigger than what I own. I guess time will tell.
0 votes Thank Flag Link Thu Apr 9, 2009
Overall prices fell 9% last year and have been continuing to fall about 1% a month this year. That 1% drop is expected through the summer, with prices stabilizing around September and slight appreciation starting in the new year. Of course this is only a consensus. No one knows for sure what will happen in the future.

With that said though if you are considering buying a home, you should be more concerned with interest rates then with prices. Keep an eye on them. Right now we are at all time lows with interest. Most people only expect that to last a few months. As soon as there is any sign of an economic recovery, interest rates will go up.

Interest rates and declining values have made homes more affordable then any time since 1981. The low interest rates, combined with lower housing prices, have brought the affordability index up to 122. That means that an individual making the median income can afford a home that is 122% of the median home price. That number is up significantly from the peak when it hovered in the 80% range meaning a person making the median income could only afford a home 80% of the median home value.

Interest plays a much bigger role right now. Waiting a month or two to get 2-3% off could cost you dearly if in when you go to get a mortgage three months from now, rates are up. Take the following example (rates are even lower now but this gives you the idea)

Let's say you are looking to make make a P & I mortgage payment of $4,418. ( I know that's high but it works well for the example so you can do an easy % decrease from the rounded off $1,000,000). Here is what changes in the interest rate will do to your buying power.

* Interest rate - 5.25%
* Desired monthly mortgage payment - $4,418
* How much home can you afford? $1,000,000

Let’s say rates go up 1%. How does that change the scenario?

* Interest rate - 6.25%
* Desired monthly mortgage payment - $4,418
* How much home can you afford? $896,922

Let’s say rates go up 2%. What can you shop for now?

* Interest rate - 7.25%
* Desired monthly mortgage payment - $4,418
* How much home can you afford? $809,541

As you see your buying power diminishes pretty quickly. So keep an eye on mortgage rates as much, if not more, as you do on home prices.

Andres Garcia
Sales Associate
RE/MAX Gold Coast Realty
56 Newark Street
Hoboken, NJ 07030
Direct: 201 795-5200 x340
Office: 201 795-0100
Fax: 201 795-1245
andres@milesquarerealty.com
http://www.milesquarerealty.com
0 votes Thank Flag Link Tue Apr 7, 2009
Michael,
If you go to http://HobokenRealEstateNews.com you can see the actual statistics for sales in Hoboken. In fact, take a look at today's post. There are quarterly figures available since 2000, including average sales, median sales, price per square foot, days on market and more.

Lori Turoff
Realtor
Prudential Castle Point Realty
203 Washington Street
Hoboken NJ 07030
NJAR Circle of Excellence '08, '07, '06, '04
info@hobokensbest.com
cell: 201 993 9500
0 votes Thank Flag Link Tue Apr 7, 2009
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