Are bayfront properties in Cape May Beach a good investment? Are they currently overvalued like properties?

Asked by Lisa, Wed Feb 6, 2008

in Stone Harbor and Avalon? We just discovered the Cape May Beach area--Delaware Bay last summer. I'm wondering if waterfront properties here have skyrocketed in the last few years or if they are a good value. Prices seem a lot more reasonable here and the view is gorgeous w/ the beautiful sunsets. Good investment or not?

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6
Brian Groets…, Agent, Cape May, NJ
Tue Jun 10, 2008
Lisa, the Delaware Bayfront will offer a wide variety of options for a second home. You can find small bayfront cottages in North Cape May for around 600k to 5000 square foot estate homes nestled in the private dunes of Cape May Beach for 2m. If your idea of a rental is whether or not they will be appealing as a rental, my answer would be 'yes'. Anything on, or within a couple blocks of the bay will be of interest to Weekly Summer Tenants. The season in this area, though, will be mostly between July & August. The Bay is a very popular area for pet lovers as well, so making your property available to them will be a plus. If your idea of investment relates to appreciation, then I would agree that there are other 'higher demand' areas where we may see the market rebound quicker. But if you are looking mainly for your own use, and have a long term outlook, I would say that the Bay Areas are a great option to get more for your $ than you'll ever find in the Barrier Islands. One thing to note is the fact that once you get above Townbank, you will see limited access to the beach. It will be only every so many blocks, whereas North Cape May and Townbank have no properties located actually 'on' the dunes, so access is no problem. Also, the beaches will widen gradually as you get further south towards the Ferry. As you head north through Cape May Beach, Villas and Del Haven, the bay will get quite narrow - often disapearing at high tide. Good Luck!
Web Reference:  http://www.CapeMay4Sale.com
0 votes
Richard Roach, Agent, Avalon, NJ
Sat May 10, 2008
Cape May Beach is a very nice area but should not be compared to to the barrier islands like Cape May, Stone Harbor, and Avalon. It is a more residential area that is not in high demand for second home vacation use. A good investment always comes with demand. The more demand the higher the price. I feel that the prices on the bayfronts along the delaware bay will continue to drop in price as they have for the past two years. Not a good Investment. In the long run the three barrier islands listed above are your safest and best places to put money.
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Chris Bezaire, Agent, Cape May, NJ
Mon Apr 7, 2008
Lisa,

David is right. Long term, Cape May Beach is more of a second home/retirement lifestyle choice rather than an investment area. Many people that have second homes there have done the same thing you have, they have looked at areas like Cape May, Stone Harbor, Avalon, and Ocean City and then they find they can get more home or closer to the water in North Cape May and Cape May Beach. The one thing to remember is that just like you, these people first started looking somewhere else because that was where they really wanted to be if price was no option. So when the market fluctuates, it is always the first to go down and the last to go up.
Web Reference:  http://www.CapeMayChris.com
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David Green, Agent, Cape May, NJ
Wed Feb 6, 2008
Sorry about that , I really didn't answer your question. Good investment or not? Having owned a bayfront property I feel qualified to answer. You are looking to buy more than a home or an investment if you plan on living there yourself or using it for a vacation home . You are buying a lifestyle, and a very good one at that. Any property that has prime location like those bayfronts do will always command a premium. More times than none the owners are not in a distressed situation and don't have to sell or won't sell at a significant loss. There was a home about 4 months back in Cape May beach that was sold through a bank for I believe around 800k ( not listed in the MLS) . That was a great deal. If you look at it purely as an investment that is different. Are we at the lower end of the correction? who's to say. Will the properties be available when it comes back up? again who's to say.
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David Green, Agent, Cape May, NJ
Wed Feb 6, 2008
Cape May Beach is a great value compared the the ocean side properties, even if you are a block or 2 in it is a very desirable area to be in. The sunsets are amazing and usually very empty. I wish I could send you a couple of pics I have of sunsets there. I have a listing there right now but it is a block and a half to the bay . There are also some very high end properties in the dunes in the 700k - 1.8 mil range .

Good luck,

If you need help let me know.
0 votes
Linette Carr…, Agent, Wilmington, DE
Wed Feb 6, 2008
Have a realtor do comparables for you to see what homes are selling for in the area. Have them go back no further than 3 - 6 months and include sold, pending and active. The active will show you what the competition is asking for their homes. The pending will show you the price point where the homes found buyers (they may have offered less though) and the sold tell you what the homes have truly sold for. That should give you a good picture of what a reasonable offer would be especially if you can compare the amentities of each property to the one you have interest in. You are probably going to be able to get the property for less than they are asking even if they have lowered it already. Good luck!
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