I cannot with certainty tell you whether prices are going to be higher or lower a year from now, nor can anyone else -- and it probably doesn't much matter in the long run. To demonstrate this point, most housing economists have been stymied by the dizzying pace at which home prices have risen in the last year.
But what I can tell you with a reasonable degree of certainty is that, over the long haul, real estate remains an excellent investment, which should be viewed as part of an overall investment strategy.
If you are buying a home that you will occupy, then you will not only benefit from the likelihood of increasing values, but will also benefit by no longer paying rent. This is what economists call imputed income.
Now, as to Waterfront home values going down 0.2% while the city overall goes up 3.7%, on what could that sort of statistic possibly be based? After all, Jersey City is the second largest city in New Jersey, with a rare and exciting diversity of neighborhoods. So the methodology would be of critical importance in evaluating the soundness of such a prediction. But, importantly, regardless of the methodology, it remains nothing more than a prediction -- or, perhaps, a guess.
You do not say in your question whether you are considering a first time home purchase, or some sort of purchase as part of an overall investment strategy. If the former, then it really does not matter what is happening overall, because surely you have an idea of where you would like to live either because of proximity to transportation, or for some other reason (or reasons). So why worry about it?
Instead, find a home you like in a building or neighborhood that you enjoy, and don't worry too much about next year's market ups and downs because you will be enjoying your new home for many years to come! And what will happen to the real estate market over those years is anybody's guess. If you want my guess: it is a very good time to buy, and the future for real estate is exceptionally bright!