For the first time in over 6 years there are indicators that the market does not favor Buyers over Sellers. I do a lot of work with statistics and a recent review of MLS data revealed some facts I would like to share with you. But first a little background.

In real estate there is a kind of formula that is founded on the idea that it should take between 9 and 12 months to sell a house. So if you were to take that idea and apply it to 100 properties listed for sale, you would want to see around 100 sales in the past 12 months to consider it a balanced condition. For a very long time the market was way out of balance as the number of properties listed for sale ballooned. But it’s not like that today. In fact the pendulum is swinging quickly towards the other side of the arc.

Here are some numbers.

In the last 12 months, at the price point between $500,000 and $600,000, 47 units were sold. The year before a total of 40 units were sold. That represents a 17% increase. The graph goes on to detail the same relationship in three other price points. This is very good news for Owners as increased volume is generally a harbinger of increased property values.

But for owners that have thought about selling it is the numbers below the graph that you should focus on. These are the number of  town homes that are for sale right now. Going back to the 500 to 600k price point you will see that only 20 units are available. That is a very short number relative to the volume of 47 units sold that we saw in the last 12 months. 3 of the 4 sections show the same shortage and represent an overall opportunity to sell in a market condition that finally does not favor the buyer over the seller. If you have considered selling or would just like to talk about the market in a general way, then just give me a call at 609-263-5301 and we can go over whatever it is that is on your mind specific to the property here in Sea Isle. Thank you and Happy Holidays

A little over 8 years ago, the town house product here in Sea Isle began to morph as the prospective customers demanded more and more amenities. Better kitchen cabinets, granite countertops, hardwood floors  and more in the interiors. Maintenance free exteriors with vinyl fencing, brick pavers and finished backyards on the outside. The product today barely resembles the product we developed in the 90’s and the buyers are responding in such a way that the value of your real estate has been affected if you are the owner of one of these older units. Previous to this change, the spread in price from a new home to an older one maxed out at somewhere around 10%. Today you can see this number moving as high as 20-25%. In addition to that adjustment in price/value you have the additional and in some instances, more alarming issue of time. When a new prospect rolls over the bridge for the first time and is exposed to our two different town house products, a majority of them are attracted to the newer models. If you are trying to sell an older unit, this means you have to deal with an ever decreasing percentage of the market that is even considering your product.  This translates into longer periods of time that a property will stay on the market and that critically important Days On The Market question that savvy buyers all ask will work against you.

How Do I Address This Problem?

Renovating your home is the only option but renovating a town house in Sea isle City and getting value on the expense is not a generic idea. If you have a beachfront townhouse then a 25% spread from new to old represents an amount of money that will allow for a total rebuild of the interior that will return a 3 to 1 value on your money. If you are on the west side of Landis you have to be more specific with the where and what to do questions involved in a renovation. A well planned and executed Reno will have an across the board positive effect on your property value and rental income potential. Doing the work now, even if you have no thoughts of selling will still increase your rental income and when the time comes that you want to sell for top dollar, the condition and the income will be there to support your price. And you will have paid for the Reno cost over the course of years with your additional income so it’s a win win situation.   It is specific and each home needs to be reviewed on its own. Give me a call if you would like some feedback. I will walk thru the unit at your convenience and we can discuss the idea as it affects you.

Thanks

Steve

If you’re not asking this type of hard,  pointed question when interviewing a prospective Listing Broker, then you need to. The average Townhouse commission paid in Sea Isle  is $16,250. That kind of money should get you something more than a sign in your front yard and the best or less efforts of a single person.

If you list with us you will be getting The Best Listing Company in Sea Isle City.  Sea Isle Realty is a company formed on a Team approach. When you list with us you will have access to different people with different specialized skill sets.

●   An experienced group of Agents to help with setting the correct price.

●   A professional Stager/Designer to help you prepare the  property for sale.

●    The best Back Office staff in Sea Isle to respond to your needs.

●    A Broker/Owner with a family history in Sea Isle Real Estate that dates back over 55 years.

Our mission is to represent to Your best interest, not ours.  Our job is to apply our combined experience and live up to the very ideal of Agency. Just take a look at the definition:

“A fiduciary relationship in which a person or entity act, by mutual consent, for the benefit of another” 

By that definition, We are bound to represent Your Best Interest.

That is our first promise and we will separate further from there. One step at a time we will employ our experience, knowledge, and conviction in vigorously representing your best opportunity.  You will have a relationship with an entire Company and a connected Team, not just a single agent trying to do everything on their own.

Join us for a meeting and we will present to you our plan and our promise of service.  One hour that could make all the difference in one of the most important financial events you can experience. One hour that will make the difference in selling or not selling your home. One hour.

I am thinking about going into the cable television repairman business. I am pretty sure that I can get certified.

Comcast in our area pushed a button 2 weeks ago. They are calling it the  “All Digital Transition”. In one minute, everyone that did not have a Comcast Box of some type between the wall outlet and the TV set was reduced to just 20 or so channels. If you were paying for what they call “ Digital Starter “ which includes over 100 channels, you could only see 20 of them. It did not matter if your TV was 20 years old or right out of the box, you could only see 20 channels unless you had picked up or been mailed a Comcast provided BOX and installed it between the wall outlet and your TV set. They have 3 or 4 different kinds of these boxes and today I know all I could ever want to know about all of them. Thats because every time one of my/our tenants called and told me that their kids could not see The Disney Channel or that the Phillies Game was not on their set anymore, I had to drive over to Avalon to the Comcast office and pick up one of these devilish little boxes and go install it. You can only install the box they give you at that office at  the address that they assigned to THAT BOX  at the office you picked it up at. No switching boxes from this house to that house. The level of control was Big Brother like. I mean, how do they know which box is which when your calling them in the middle of America and your sitting in a house in Sea Isle City, NJ.

I have installed every kind of box in the Comcast line and you know what. None of them takes five minutes. Every time you install one you have to call Comcast to get it activated. Every time. It’s not enough to install it and turn it on anymore. You have to call Comcast and wait through the same recorded pitches and questions, again and again before someone picks up the phone so that they can ask you 5 questions so that they can transfer you to another person that can ask you the same 5 questions so that they can then push some sort of button and make their Little Black Box perform it’d magic. I have been on the phone with Comcast at least 100 times since they flipped their little switch and that is not an inflated number. Either my son or I have been in line over at the Avalon office on a daily basis every day for the last two weeks. We had to have installed over 50 of these boxes in the units that our customers were staying. I am almost ready to start READING again in an act of protest.

But seriously, you can no longer get your TV to work without a Comcast Box unless you are willing to just have what they call basic cable and if you are the owner of a property that is attempting to create rental income of any consistency on a year in and year out basis, then there is not a bigger mistake you can make than just providing 20 basic cable channels. I know that a lot of owners think that their customers don’t need anything more than 20 channels, but I have met your customers in person with their kids staring at me in a very menacing type of way and I can state with great conviction that they disagree with you. The cost of a lost customer is not worth saving a couple hundred bucks a year on Cable Service and thats if you only lose one. So bite down hard on something that won’t chip your teeth and call Big Brother. Tell him you have seen the light and want to cross over to the Comcast Zone. If you need any help, don’t call me. I’ll be reading a book.

Thanks

Steve

If you own an older condominium unit in Sea Isle City, there is something you should be thinking about and a question that you should be asking yourself. That question is; “How does the new Commercial/Residential zoning affect me and my ownership? It is a question that does not have the same answer for every condo owner. In some ways it will affect everyone that owns an older unit in exactly the same way and in some ways it will be more specific. The first and most important consideration is that for the first time in over 25 years, there will be a constant source of New Construction that will stand as direct competition to the older units. Previous to this new zoning, when an owner of a condo in Sea Isle went to sell, they only had to compete with other products of like size and age.  Now, they will be competing with brand new units just like the owners of Townhouses have always had to do. This creates challenges that have to be met and it is better to get out front with this than to wait until the the condition amplifies and puts you at a greater competitive disadvantage. In some instances, just like Townhouse owners, Condominium owners will be faced with the reality that it is to their advantage to Trade Up into a newer unit with more income rather than face the expense of improving an older unit and then still have to face all the competition that the new rental units represent.

One way or another, this new Zoning is going to affect you. Whether you rent or not. Whether you are thinking about selling now or in the future. This new zoning is something that you need to better understand. Not only will you have to consider where you property competitively stands relative to the other older units when it comes to condition and location, but you will need to be aware of the New Projects as they move down the pipeline and enter the market.

The response will be specific to each individual property and each owner. Your best interest will not be served without performing due diligence. This new zoning will introduce an influx of new customers into Sea Isle City and potentially represent opportunity for all owners of condo units but if you just act like it is not happening you might find out too late that it already did.

Thanks…….. Steve

When I look at the beach block market what really sticks out is how far some of the older homes have dropped in price. This is where I have directed my last group of investor customers. As an example, I will use a listing located at 30 69th Street. This is an older full size townhouse. The price is down at the 700k mark. If a new townhouse was in a location like this, the price would be $1,050,000. This is a 33% spread in value. Traditionally in Sea Isle, the spread between a new home and a quality older home could be as little as 7% with 10% being a more normal relationship. So why these enormous gaps in value?  The reasons are many and too much to try to explain here. What I can and have said to you and other customers this spring, is that these listings represent the best opportunity in Sea Isle right now. The last 3 people that I have worked with on these type of projects are in the process of extensive renovations with contractors that we have in line for this type of work. I have included photos of some of these reno projects. Take a look at these images and see if you can tell the difference between this home and a new one.  If a renovation of that type were applied to our example property, the all in cost would be under 800k with a budget in the 80K range for this scope of work. If correcting the neglected condition left you with a 26% spread, there lies the value. If the Unit could return to a relationship in the 12 to 15% range, you would pick up between 10 and 12%. And there’s a kicker too. The rental income of the fully renovated home could be in the same range as the new home for a purchase price of over $250,000 less. This model can be applied to more than a few properties listed for sale right now in the beach block and on the beach front where the examples are even more dramatic. If one of these projects seems like the deal you have been waiting for then give me a call so that I can fully explain this unique market condition.

Thanks

Steve

I have been specializing in New Construction here in Sea Isle City for the last 15 years. When it comes to the development of new homes, it is safe to say that I have more experience than any other agent in this market. Period. From design to construction/development to listings and sales, I have done it all. I am telling you this so as to qualify the idea that I am about to share with you.

NEW CONSTRUCTION AS WE HAVE KNOWN IT IS ALMOST OVER IN SEA ISLE CITY.

That’s right. The days of seeing 100+ new units come to the market in any given year are OVER. Why do I say this. Because there are less than 200 non-developed full size lots  left between 45th and 85th streets as I write this. In the course of my work I have developed and maintained a list of all of the full size lots here in town that have not been developed into a side by side. It is how I made most of my living, so when I saw the shortage of properties that could be developed begin to forecast the end of the town house development era here in Sea Isle City, I began to think “what am I going to do”.  Then I began to think, how is this going to effect the town house market in a broad sense. I have been thinking on that for over two years now and I have been tracking market data that I think is important to you and to me. Important to anyone that has an interest in the town house market here in Sea Isle City. The space here is to small for me to develop this point fully as we specifically consider the categories and sub-categories. So let me wrap it up with this point. If you own a townhouse or are thinking about buying a townhouse here in Sea Isle City, there are things you should know. If you will share some specifics with me, I will be able to help you. If you want to talk, call me at the office number. 609-263-5301

Thanks

Steve

What A Difference A Year Makes

I remember way back in the day when we had a pool here in Sea Isle. The year was 1964 and it was located on 63^rd Street across from the Shopping Center. The whole community used it. It was like a family barbecue that happened every day. I remember that all of the concrete walkways had these big letters written on them. NO RUNNING ALLOWED.   Those words were there to try to keep us kids from hurting ourselves. I never could get the message and I got scraped up pretty good. They say that we live and learn. Some of us just live and then live some more.

Real Estate in Sea Isle City sold and grew at an unparalleled rate between 2001 and 2005. Many of us were moving very fast with no regard for the potential consequences when the market stopped dead in its tracks. The 32 month correction period was a bitter pill for the Candy Cane Crowd to swallow and just when it seemed as if we were coming out of it, The unprecedented events of Fall 2008 happened and things got WORSE.  I felt like you do when you set up for a big party and then nobody shows up. I couldn’t get a person to talk to me about Real Estate, selling or buying. I was sitting at work looking at my computer. I needed something to do.

I like project work, the kind of job that you never complete. It just keeps adding to itself and get’s bigger and bigger. A little over a year ago I started a project. It began with me taking a look at how our rental owners were doing. Our rental business had increased significantly that past summer after making some changes to our website and it was already on my mind so I decided to go a little deeper. As I went back through years of rental income data, I uncovered some important information that I began to share with the owners I was working with. We managed there rates through the winter and spring, adjusting up & down as we went along and when the year completed itself, we were able to look back on some spectacular results. Income was increased in just one year by 10% to 30% I have developed a rate setting and activity tracking tool that I am now using very effectively with a number of rental property owners.

In August when the late summer lull hit I started to look at the Sale data going back to 2004. I have been working with that information for the last six months and have started to use it in my work this fall with buyers and sellers. As we begin the year 2010 the market here in Sea Isle City is getting stronger. The data shows that the New Construction price on the west side of Landis Avenue has been stabile for over two years. This category has long served as our baseline, the number that everything else adjusts to. That it has settled into a solid place is allowing the rest of the categories to adjust to it, finding their correct relative positions. We have sales in the beach block and beach front categories that we have not seen for years. In the last 12 months, the critical beach front category alone tells quite a story, with seven beach front townhouses going under contract. In the 12 previous months, that number was two.

We are walking out of this, one step at a time. As I move into my 53^rd year I am starting to see those words from 1964 again and again. They have finally made an impression in my minds eye.  NO RUNNING ALLOWED.   If last September had not happened, I might not be able to see that. If last September had not happened I would not know what I know about my business. In the long run it might end up a good thing. Imagine that.

Thanks

Steve

What’s Going On?

I know that a lot of our owners feel as if they have no idea as to what they should be doing with their properties here in Sea Isle City and that’s not good. People need to think they know what is going on in their world and in their lives. They count on it like they count on the sun coming up in the morning and the moon at night. Some people call it security and some people don’t call it anything. They don’t call it anything because they don’t even consider it. They take it for granted. It’s always there and when it isn’t they notice. They notice it in the way they feel. Restless.

Last year in August 2008 I felt that our Fall would be very busy. I met people all summer that qualified as real prospects for a purchase here in Sea Isle. They had satisfied themselves as to the markets corrected condition and were ready to act on their dream as others had before them. When the unprecedented events of this fall hit the National news things didn’t slow down here in Sea Isle, they stopped. Those people that were investigating the idea of a purchase this past summer are still there and they have started to shop again. The question as to their desire for and capacity to afford the product has never been the question. The question always has been and always will be as to the question of the TIMING. When they will satisfy themselves on the critical issue of timing is now back to being a very solid “not now” for many of them

The buyers market was going away last spring and now it is back. Kind of like a stray cat that you feed. It will not go away until it stops being fed. And even after you do stop giving it food it will sit outside your door and scream for a good while. We had reached the point this summer where our prospects had stopped making that awful noise and were getting serious.

What Should I Do?

The simple fact for most of our owners is that before we moved into this recessionary period a few years ago they were not even thinking about selling. They had been thinking about owning here in Sea Isle for a long time and now that they had realized their dream they were enjoying the experience. For most of those owners things have not changed so this recession will be handled like the ones that came before it. Our corrections are regular like they are in every market and they are predictable in their habit of following themselves with a period of growth. At least that has been the case in my lifetime as I have experienced these cycles.The game of follow the leader is how we got here. Everybody is selling so I’ll sell. Everyone is buying so I’ll buy. The idea that there is one direction is attractive because you get to look at the guy next to you doing the same thing you are and it makes you feel safe. The problem with that kind of safe thinking is that it does not take into consideration that everything we do is absolute and specific. That we cannot just follow the pack and have it work out best for our families specific situations. The absence of a plan in a critical situation can serve no good end. You need to have a plan if you want your ownership to be successful. I guess that leads us to this question.

What should my plan be?

People will tell you that if you are not thinking about selling you don’t need a plan. That is probably not true unless you think you are never going to sell, never going to rent and that some day you will just walk away from the your property with no concern. If that is your thinking then doing nothing is a plan. Those people need not read any further.  If this does not describe you keep reading, because the rest of this piece has been written for people that need making a plan that will work.

Many of our owners that need to sell right now are back to being subjected to aggressive lowball tactics as buyers return to the advantage position. If you need to sell then you have to be aware of the things you need to do before you list. The days of just throwing it out there and “seeing what happens” are over. In fact, that kind of action hurts more than it helps. It hurts the individual and the collective. If you are in this category  you should not list your property without knowing just how much has changed and what you need to do to be competitive.

If you do not need to sell you still need to have a plan. Maintaining your property so that it can achieve maximum rental income will have an effect on your sale price when that day comes. Not maintaining it will put you in the position that some of your neighbors are in today. Trying to sell a house for a price that no one wants to pay and feeling confused and angry.

We have developed an exciting new program to help owners with their 5 and 10 year plans. Give us a call and let’s talk about it. We will perform a full rental income analysis  and unit condition inspection. We have seen why  the top performing properties in every category are succeeding and we know how to help you with yours. Let us advise you as to how to best position yourself in the future so that you can maximize your investments value.

I have worked more these past six months than I have in the past two years combined. I had to because things have changed so much in my business that I needed to re-educate myself in almost every area of my work. I found something during my investigations and it was something I did not expect to find but knew I was looking for. Hope.

Our small world here in Sea Isle has changed but one very important thing has not. It is why you bought your property here in Sea Isle and it is why so many others hold onto their dream of owning a second home here at the Jersey Shore. This is a magical place for a lot of us. It is the magic of nostalgia. The magic of collective memories so good that you can’t help but smile when the thoughts come to you. That is a very powerful thing and it can not be changed by any economic cycle.

Thanks

Steve