Brigantine real estate blog

New Jersey real estate as investment

New Jersey Real Estate Investors are not scared off by any kind of talk of a "Bursting Bubble"

A recent survey prepared by the National Association of Realtors has determined that over 23% of all homes purchased last year were acquired as investment properties.

Many of the newer real estate investors involved in this survey, got into the market after witnessing their stock portfolios stall and wither, while at the same time, their homes were appreciating in value like never before and their home equity was soaring.

Both East Coast and West Coast Investors continue to buy up properties at an unprecedented pace and continue to ignore warnings issued by economists, analysts and even Alan Greenspan, of an overheated real estate market and pending slow down. Vacancy rates remain higher than normal in some areas, but builders and developers continue development at an all time record with new homes, as in New Jersey, condos and town homes selling (and the property appreciating) like never before in history.

Brigantine New Jersey Second Home Owners Celebrate

All of the Brigantine New Jersey summer vacationers who have second homes and those who have Vacation homes for sale in Brigantine were  relieved with the news that the scheduled beach replenishment project has been delayed from the end of July until at least September.

The delay is due to the July hurricanes in Florida. It seems that all of the dredging and replenishment projects were delayed there because of the storms, thus all the equipment needed is still in Florida

The City of Brigantine was rushing to get the replenishment started before federal funding ran out. Because of these natural disasters to the south, the government cannot penalize Brigantine for the delay. So our beautiful Jersey Shore remains undisturbed for the remainder of the Summer.

Is a Housing Bubble going to affect Jersey Shore real estate

The Scary  Bubble

"Housing bubble” has such a dramatic ring to it, and it sounds scary.  Plus, these words sell newspapers.

Is it possible that house values in The Jersey Shore area will decline soon? No one can really predict. However… we can learn from history.

In the '70s property values appreciated faster the in the  recent three years.  In the following 10 years home appreciation doubled. Beginning in the late 80's we saw property values decline for about five years. A total of about 12%.

What’s different this time? Numbers, expressed in dollars, the recent increases in value seem extreme.  As a percentage of the home’s cost, appreciation has been more rapid in the past and there could be many more years of appreciation in the future.But no one knows.

Housing Bubble Protection:

If no one can predict if or when prices will decline or by how much, how do you protect yourself? You do it the “old-fashioned way.”

When you buy a home, buy one you intend to own for a long time.  The cost of a house isn’t just the price you pay for it and price may not be as important as your carrying costs.  The largest cost is your mortgage payment.  With low interest rates, people can afford more expensive houses because their payments will be low.  If possible, skip the “first-time homebuyers” house and buy the “move-up” house.  That saves you one move, saves you costs, and puts you in a position where you don’t have to sell.

You see, how much your house goes up or down in value each year doesn’t make any difference at all – until you have to sell it.

Then, if you’re selling in a slow market – you’re also buying in a slow market.  If you’re buying in a hot market – you are also selling in a hot market.  It equals out, provided you have equity enough to make your next purchase.

But if you’re buying a home to “flip” it in a year or two and the market does turn against you, you could be hurting – providing you have to sell.   If you're buying just before a down market and you get transferred or relocated, you could be hurting, too - providing you have to sell the home.

Conclusion:

There probably is not a “housing bubble” in the way that there was a Nikkei bubble or a dot.com bubble.  However, it is quite likely that there will be some time in the future when values decline, at least in certain areas.  It could be in a year or it could be in sixteen years.

How did most people cope in the past? They rode it out. They didn’t sell.  Later, prices recovered and bypassed previous highs.

Right now, those are some pretty happy folks.

Pete & Bev Petridis
www.petepetridis.com
Pete's Cell: 609-377-4023
Bev's Cell:609-352-9257

Brigantine Realtor advises the New Jersey home buyer

Sources of Down Payment

As you search for your New Jersey Shore new home, it hits- the reality of how much ready cash you will need to purchase that Jersey Shore home of your dreams.

One of the most appreciated services a Brigantine Realtor offers is helping buyers find the source of the down payment to buy their new home, especially when the potential buyer thought they couldn’t afford it. Below, you will find a partial list of some potential sources for a down payment.

1. Cash value life insurance
2. Gift from relatives
3. Equity in a car or other asset
4. Year-end bonus

There are other sources besides the ones listed. If you are unsure about the practicality of any of these, please feel free to call Pete or Bev Petridis or send us an email at any time. We are here to help you.

Pete & Bev Petridis
www.petepetridis.com
Pete's Cell: 609-377-4023
Bev's Cell:609-352-9257

New Jersey News

With all the new development in New Jersey both in new home starts and commercial development, some Jersey Shore residents are concerned about the recent Supreme Court ruling concerning eminent domain property seizures.

Local, State and Federal lawmakers in many states are busy studying the eminent domain laws and are beginning to write legislature to safeguard home and small businesses.

Supporters of the Supreme Court ruling insist that constituents can simply vote against elected officials that invoke eminent domain for economic development.

Perhaps the best a New Jersey real estate owner can do at this time is to write both your State and Federal legislators. Second, be vigilant in monitoring the decisions of elected local, state and federal lawmakers.