Market Report

As a Realtor, the question I am asked most these days is: “Has the market hit bottom yet?” My answer today is: “Yes. I think so. I think we hit bottom in early November.” This is my opinion, of course. However, I base my opinion on statistics and what I see, not what I “feel”. What I see is an awful lot more prospective buyers looking, and alot more properties being sold. Those buyers began to come back to the Shore market in mid-November. The activity noticeably increased. Statistically, the first quarter of 2007 has seen more sales occurring (more than double that of 2006, in fact) than we’ve seen since the Spring of 2005.
I’m not exactly sure why the market stopped so abruptly. There are a number of theories. I seem to think there was more than one contributing factor; interest rates began to tick higher, Hurricane Katrina was scary, thefast pace of the market was intimidating for some. There were other possible contributing factors. When I receive my Masters in economics, I may have a more definitive answer. What I know is that the real estate sale market came to a halt at the beginning of the Summer of 2005.
Is the “correction” over? First, it needs to be said that there was a correction. As I look at sale statistics for the past
2 years, I see a 15% decline in average sale prices in Sea Isle City. Some areas of the market have experienced a larger
decline. Land values, for instance, have dropped closer to 20%. I believe that the reason for this is that those prices were driven by developers, speculating on future sale prices. The developers, by and large, are not purchasing anything at all right now.
So, yes, there was a correction. Is it over? Only time will tell of course, but as we head into the Spring there are fewer
homes on the market than the past year and more sales occurring than last year. So, I would have to say yes.
Is now the time to buy? Yes. That’s an easy answer. Why? Well, although the inventory is thinning, there are still a good amount of homes on the market. There is a good selection in all price ranges and locations. Also, although I don’t see “desperate” sellers like last year, there are “motivated” sellers. There are also mostly realistic sellers. It has taken some time, but most sellers have been forced to acknowledge market conditions and reduce their prices.
Further, we are seeing another strong year in the rental market. That income may help you transition into a second home with confidence.
Historically, prices in Sea Isle have increased by an average of 15% per year over the past 25 years. I’m not sure what the near future will bring in terms of appreciation, but unless you plan to “flip” the property, the long term outlook is bright.
Is it time for you to buy a vacation home at the Shore? That’s a question only you can answer. As a Realtor, I can tell you that I have more confidence in the market today than I’ve had in some time, and that the real estate market here at the Shore is stable. There are good deals and good values to be found. And of course there’s the beach!

Andrew Fasy
Broker/Salesperson
NJ Realty, Inc
4914 Landis Ave
Sea Isle City, NJ 08243
www.njrealtyinc.com
800-648-9316 * 609-263-2267
Fax 609-263-3707