2009 Apr 1st

Weekly Wednesday Wrap-Up: Hoboken Condo Sales & Inventory for the Week Ending March 31st

Research, analysis & post by Lori Turoff

Who is the April Fool?

I’ve written a lot in this space about sellers overpricing their units.  Often, as noted below, it takes quite a few price changes before a unit sells.  Nonetheless, we have a continuing build up of inventory.  The ‘spring pick-up’ in the Hoboken housing market may be more psychological than real.  Today I’d like to point out that buyers are often as unrealistic about what they believe they can purchase a Hoboken property for as sellers can be as to what they can sell it for – thus, the standoff.  One of the most important things a buyer can do is learn to assess value.  When the average sales price (not list price) for a Hoboken condo is over $500 a square foot, the buyer has to ask him or herself a few questions if they expect to pay below that:

All buyers want a bargain but sometimes the unit is priced property and were it to sell for a little (up to 5%) off asking, they would be getting a deal.  Not every unit warrants a more than 20% discount off list.  What I repeatedly see happening is buyers make offers that are simply too low and sellers just say no.  Eventually, after losing out on a few good properties the buyer realizes that they are not being realistic about price.  That’s why it is so important for buyers to look at lots and lots of units.  The more a buyer sees, the better able they are to judge what a property is  worth.  Sure, there are bargains to be had on the overpriced units but not every unit is overpriced.  The ones that are really nice and priced right continue to sell without price reductions and very close to asking price.  While many sellers still won’t accept the reality of today’s market, sometimes the stand-off is the buyer’s doing. 

Stay tuned for the March Hoboken condo sales results which will be posted very soon.

The Hoboken Condo Weekly Numbers

Studio & 1 Bedroom Hoboken Condos:

192 total active – $432,793 average asking price.   88 average DOM.

None under contract.

4 sold –  $378,250 sales price.  172  DOM.

2 more sold prior to this week but the sales were not reported to the MLS in a timely manner by the listing agents.  Some agents don’t bother to change the status when their deal closes until weeks later despite the 24 hr. rule.  Unfortunately, no one from the MLS bothers to check or enforce the rule.  I will include the info but these sales are not included in the weekly averages for this week nor have I gone back to change the average numbers for the week in which they should have been included.  Some, like 924 Jeff, closed on the 24th  and get reported on the 25th so they really belong in last week’s totals.  Others, like 418 Bloom below, closed weeks ago.

 8 new listings – average list price $514,374. 

15 price reductions.

Two Bedroom Hoboken Condos:

287 total active – average asking price $642,984.   113 DOM so far.

 4 dabos – after an average of 68  DOM

3 sold – average sales price $535,000.  Average DOM 97

2 sold but were reported late.

 12 price changes

12 new 2BR listings – average list price $657,308.

Three Bedroom and Larger Hoboken Condos:

54 active 3BR condos – average asking price $982,274.   139 DOM so far.

None under contract.

None sold.

5 price reductions

3 new listings  average list price $723,333.

Hoboken Condo Open Houses

If you are in the market for a Hoboken condo, our once again improved Hoboken Open House Google Map is your single best source for info on every open house in Hoboken.  It’s posted on Friday every week.  The info is updated weekly.  If your google search seems to pull up an older version, click on the title link to get the most current map.  



  1. Tiger

    Call me optimistic, but I don’t think our numbers are bad at all. Yes, the number of transactions is almost half of what it used to be, and yes, the price went down, but I just think it’s great that there’s still activity.

    I can’t make a 100% informed decision from the pictures, but I can tell that the units that moved seem to have a nice layout and finishes; which supports the idea that nicer units, with the proper price, do sell.

    Great job Lori! It’s not a Wednesday without the weekly wrap up. Looking forward to March numbers.

  2. stan

    Tiger- I am the empty half of the glass. There will never be zero transactions. There will always be some activity. 7-8/week leave us at a 1.4 year supply. Some buyers arent serious, some sellers arent serious. The ones that are come to an agreement.

    priced well, it moves, if it isnt moving, it’s too expensive.

    Great work as always, the insite is very helpful and informative.

  3. Jon

    I’m going to have to disagree with you Lori. I still believe the Hoboken housing market is overpriced. Historically, it would take properties years to build 100k in equity. Not 2 years like everyone here expects. I think prices will adventually drop to the 2004 market rates before the peak. Just my opinion.

  4. Tiger

    stan, I think you hit the nail on the head ‘some buyers aren’t serious’ is always the case, ‘some sellers aren’t serious’ is definitely a trend in Hoboken. Of course, there’s a big inventory, but I am almost certain a portion of this inventory is not real, a group of owners not willing to sell under a certain price, and others who are simply timewasters feeling out the market. It doesn’t cost a thing to keep a condo on the market, does it?

  5. stan

    tiger-good point.
    They are waiting on the magical buyer to swoop in and give them the price ‘their property has earned’. It does cost someone money, the realtor. I do not envy the realtors job convincing the irrational to drop a price to move it. It is happening more frquently though, and Lori does speak to this often.It also must be frustrating with a buyer who wants 2004’s price today.(if they think that’s the way we are headed)

    However, things seem to work in accelerating trends.
    If I look at a place and its comp is 440, I am now offering below that. many sellers do not seem to realize tha trend that pushed things up, works the same way with Comps on the way down.


    I do agree with you as far as further price declines. I actually think we are 2005 prices now.

  6. Lori Turoff

    Yes it does cost us realtors something to list an overpriced property in the way of wasted time, resources & effort. It also costs us something to work with unrealistic buyers. That, though, is the nature of our job. A good realtor doesn’t take overpriced listings (we don’t need to, we have enough other business to keep us busy & making a living). A good realtor also knows when working with a given buyer is worthwhile. We’re not tour guides. I’ve had that job in my past business and don’t need to do it again. We know how to judge when a buyer is realistic and committed to buying and when to say sorry, this isn’t the right market for you. But, as they say, if you can’t stand the heat – get out of the kitchen.

    I think some of the reason for disagreement over whether the market has hit bottom comes from our tendency to talk about all of Hoboken as one big market when, in reality it’s not. I don’t think the same factors affect Maxwell Place or high end properties on Hudson Street as they do run down, badly renovated walk-ups on Monroe. I don’t think the same buyers are shopping for those properties. In an ideal world, I’d love to break Hoboken down into smaller neighborhoods and do the analysis on each but I simply don’t have the time.

    What I’ve seen is that the garbage units that used to sell in ’06 no matter what, are now not moving. The bad layouts; the units in bad repair; the units with the slanted floors; the 5th floor walk-ups; the units on the far west side of town. There is no doubt that these properties have come down in price and will continue to do so. On the other hand, the pristine parlor-level condo in a brownstone on 9th and Garden with a private yard still sells for full price in a week with multiple offers. Maxwell Place units with a view, the Garden St. Lofts that don’t face a parking garage, the upgraded units at the Constitution and the Hudson Tea units with good layouts and that don’t look directly into some one else’s windows, certain well-appointed older buildings in the north east part of Hoboken or very near the PATH still sell at a premium and have not seen a significant decline in value. So the trouble is when we lump it all together we lose some information and perspective.

    That’s, I believe, also the problem that the buyers and sellers have. They need to be able to recognize quality. Sellers need to understand where their property falls on the quality spectrum and to price accordingly. Buyers need to understand that if they are buying a high quality property they are not going to be able to steal it. Seeing a many properties a week as I do, it seems obvious to me. Many sellers never go out to look at other units when they list their own. They should. Same for buyers – the more units they see the better judgment they can make. So talking about “the Hoboken Market” can be misleading. I give you the info as best I can. As I don’t get paid to do this I can only devote so much time. Hopefully, you get a good sense of the market and it will help you draw your own conclusions.

  7. homeboken

    Lori – I have a pretty glaring disagreement with your argument. We all understand that real estate is not a market that has large volume and their for, price discovery is really an art form. By contrast, ask me the price of MSFT stock and I can tell you, to the penny, what you can buy and sell a share for.

    As it pertains to Hoboken homes; a unit that is listed is truly only worth the amount of the highest offer. All else equal, if a condo is listed for $600,000 and I lowball a bid for $485,000, your contention is that I am not realistic and that I am a stubborn buyer that doesn’t know how to value property.

    If the Seller says “No, my home is worth more than that.” Then fine, that is their right as owner. But if weeks go by and there are no other bids, or worse, bids lower than mine, then who is truly mis-juding value.

    Absent a sale, the market value is set by the bid, not the ask. This is a key reason why I beleive the market has halted.

  8. Lori Turoff

    Homeboken –
    To which I respond, shares of stock are fungible. Property is unique. Fundamental difference there. If you assert that the only way to value real estate is by receiving an offer, what do appraisers do? There are many ways to value assets. The real estate industry uses comparable sales often.

    Yes, if no one makes an offer except the low ball bidder the property may be overpriced but, in my experience, the prime properties of which I speak DO sell and the sell close to the $600K number, not the 485K. So when I see a 600K condo that’s really, in my opinion as an expert, worth 600K chances are others will see that too and it’s not going to sell for 485. Agreed, the 600K unit that never sells is more likely not worth 600K. There are plenty of those around. But there are bidders offering 485K on units that really are worth 600K and they get shut out time and time again. That is my point.

    Market value is set my what similar properties fetch in the real estate world. Not exactly the same as securities.

  9. stan


    points taken, but if no one is offering the asking oprice, and there are other properties moving, that property is NOT worh 600k. You may think its worth 600,000, but it isnt at that time.

    I am an owner, but I am fully aware that renters or buyers, can wait longer than owners can stay solvent. In this waiting game, the buyer has the advantage

  10. homeboken

    Lori – Your assertion that homes are not fungible assets is the proper way to define homes. However, over the course of the last decade, millions of homeowners treated their home as a fungible asset.

    The moment you pull all the equity out of your home to buy an investment property, or to take a vacation or trade it for any type of good, the definition changes.

    I agree there are many ways to value real estate. Without specifics, my day-job has me on the seller side of multi-family properties across the country, so I have more models to value real estate than anyone could ever want. I still contend the best way to evaluate the value of my property is to collect bids and let the market tell me what it is worth.

  11. Lori Turoff

    From Wikipedia: Fungibility is the property of a good or a commodity whose individual units are capable of mutual substitution. Examples of highly fungible commodities are crude oil, wheat, orange juice, precious metals, and currencies.
    Fungibility has nothing to do with the ability to exchange one commodity for another different commodity. It refers only to the ease of exchanging one unit of a commodity with another unit of the same commodity.

    People did indeed treat their homes as ATM’s. That doesn’t make it fungible. One of the basic premises of real property law is that property is unique. That is why one is able to sue for specific performance.

    Beyond that – I don’t disagree that bids wills set the price for a given property but you guys are missing my point.

    When there is a lowball bid on a certain property and then other bids come in at or near asking, the buyer who made the lowball bid is the one who didn’t value the property correctly – as proved (as you point out) by the later, higher bids.

    I OFTEN see a buyer, let’s call him Mr. Lowball, make a too low bid on a property and then another buyer comes along later and prices it correctly, i.e, buys it. Mr. Lowball goes from condo to condo making offers that are unreasonable and bases the offer not on comparing the value of a property to other properties like it but just by using some arbitrary discount number off the list price. Even when the property is priced correctly, Mr. Lowball expects to get that same discount. My point is that you cannot treat each condo the same. Some are inherently worth more than others. Some are priced fairly and some are overpriced. Mr. Lowball has to have an understanding of value. It is that situation to which I refer. Not the unit that nobody bids on. I think we can all agree that some units clearly overpriced as evidence by – 1. no showings, 2 – no offers, and utimately, 3 – no sale. So I don’t think we really disagree – we’re just talking about different things.

  12. stan


    agreed. apples and oranges. A place with no offers is over priced. A guy who bid 350 on a place that sold for 450 is unrealistic.

  13. homeboken

    Lori – We do agree. If a buyer bids 20% off ask as a matter of principal and never gets an offer accepted, then yes, he is the idiot.

    Why is it so easy to see from the buyers side?

    The defintion of ignorance – Doing the same thing over and over again and expecting a different result.

  14. Lori Turoff


  15. patk14

    Time will tell, but I expect the “premium” buyers in Maxwell Place will get murdered before this real estate cycle is complete. Remember, those units with Manhattan views cost more originally than those facing west, i.e. the price of the view was factored into the original purchase. Couple of other things. These new units all pay higher taxes than older units which reduces their value. They also sold at higher prices so a 30% decline on an $850K property is a $255K loss. A 30% decline on a $500K property is only $150K. Most of the buyers are likely financial/law people whose incomes are being reduced the most right now. An exception was the greedy couple featured in the NY Times a few weeks ago who had no business buying a $900K apartment at the peak of the market. Finally, the condo developments on the westside of Manhattan are getting crushed as we speak. A majority of people would still prefer to actually live in Manhattan than to look across the Hudson at it. Those price reductions will hit developments like Maxwell extremely hard. Watch what happens over the next 12 months in Maxwell, this will not end well.

  16. Lori Turoff

    I would think the added value of having the view at Maxwell, especially the direct eastern exposures, would continue even in a down cycle. Those units should always sell for a premium over ones with no view regardless of whether all prices decline.

    Starting salaries at the big law firm, to my knowledge, is still nothing to sneeze at – maybe 200K? – plus start up bonuses. Two young associates from Cravath or Skadden could easily afford a place for a million. Yes, there may be fewer of them around than in the past but the big firms are loath to cut salaries. Don’t know that they’ve ever done it.

    The couple in the Times made me laugh. He’s a realtor and didn’t realize there was no mortgage contingency in the contract? They were a really poor choice for that article.

    Why do you say condo developments on the west side of Manhattan are getting crushed? What I read in the most recent Prudential Douglas Elliman report was that the West Village is still appreciating! Just curious where you’re getting your info. I think some new development in areas like Harlem and Red Hook are hurting, though.

  17. Lori Turoff

    If you’re interested, here is the link to the Manhattan 4th Quarter Market Report:


    It shows that the west side has gone up in price.

  18. ParkAve

    Check this out – “Not Just a Bad Dream” about Manhattan real estate market. Some similarities to what we are facing in Hoboken.


  19. Lori Turoff

    ParkAve – Thanks! That’s a great article and exactly describes Hoboken as well. Just at lower price points.

  20. AL

    The real estate market prices adjust slowly compared to the prices of other assets. Look at the history and you will see that the period of the real estate cycle is long. Buyers know that SOME sellers at a certain point HAVE to sell (lost job, moving to the suburbs, …). Buyers NEVER HAVE TO BUY. Worst case, they can rent. That’s the big difference.
    Buyers have to be FORWARD-LOOKING until the market reaches the bottom. And we are far from the bottom. I think that comps are less important if you are forward looking in a declining real estate market. Comps were good for buyers in a boom market because they would let the buyer bid lower compare to the future market value. So I disagree with you Lori when you criticize low-ball offers as a waste of time. Forward-looking buyer with a negative view of the market will low-ball.
    Real estate agents have plenty of sellers now but the lack buyers, maybe have low-ballers.
    If the seller were forward looking too probably would cut their prices 10% now. There will always be some natural turnover and few naive buyers that don’t see what is happening and “get carried away”. They get their 5% discount, are all happy but they don’t realize that they would get 15% discount in 6 to 12 months.

  21. Laki

    Unless US government inflates majorly (i.e. +10% per year for 4 or so years), New York metro area real estate prices will get decimated. Any local analysis that is Hoboken specific has very little relevance for what’s going to happen in the next 3-5 years. Relying on local research today is kinda like holding an umbrella on a rainy day in Indonesia just before the tsunami hit in 2004. Umbrella or no umbrella, you got wet (or worse).

    We’re going through an economic tsunami right now and to think that real estate bubble that saw Manhattan prices per square foot triple since 2000 is not going to deflate is delusional. (source: http://analytics.radarlogic.com/radar-logic-home/historical-data.aspx … pick Manhattan condo in a drop down). If you disagree, what economic justification can you provide for this insane increase?

    New York real estate is where CA/FL was 3 years ago. Transaction counts totally dried up just before prices started tanking for real.

  22. stan


    To patk’s point about manhattan see above article. Sums it up well: Median is being increased due to new developments that closed last quarter but were under contarct for some time. Inventory increasing and sales pace decreasing, we know where this heads. Look out below.

    As far as big law: They are hurting. Many RIF’s, pushing off first year star dates and the unthinkable is starting to pop up……. No across the board pay increases!(oh the humanity) it will be tied to the production you bring in. Also many firms are talking about reducing salary’s to save the ship. The big law firms are like lemmings, once one does something they all follow suit. Things will be tough for a while.

  23. patk14

    Lori, I was referring to the new condo developments along Riverside Drive in the UWS. Delusional buyers paid ridiculous prices per square foot pre-construction and are now running for the exits and leaving their deposits behind. There will be auctions within 12 months for these places. Now, if I can buy one of these at auction for slightly more than Maxwell in Hoboken, NJ, it has to force down the price at Maxwell. As far as the West Village/Tribeca/Soho, they are falling less rapidly but they are, in fact, falling. Confirmation of this will come out when the deals being done right now close over the summer.

  24. Tiger

    Laki, no one is saying that the NYC market is not going to further drop, but I respectfully disagree that it will go down the route of Cali and Florida. Just take a look at this pole from USA Today:


    While NY had a 9.6% drop in prices over the past year, Miami, Phoenix, LA had between 25% – 35% drops, and that’s only over the past year. As you are aware those areas dropped 30% or so from 07 – 08.

    Seriously, the sky is not falling.

  25. Ron

    “Buyers have to be FORWARD-LOOKING until the market reaches the bottom. And we are far from the bottom.”

    I think this is the crux of the problem Lori is describing. Certain buyers think they have perfect clarity to what is going to happen.

    There is no certainty into what is going to happen and the is no forward market for actual real estate.

    if you think the market is going to hit bottom in 12 months, then wait 12 months to buy…..otherwise the price today is today’s price.

  26. homeboken

    And what what determines today’s price Ron?

  27. Tiger

    homeboken – Supply and demand. Yes buyers do not have to buy, but then again not all sellers have to sell either. If it was up to buyers, you would buy real estate for $1 a piece. It’s actually a mutual agreement between buyer and seller, that’s what determines a market value.

    If the offer is too low the seller won’t sell. If the price is too high the buyer wouldn’t buy.

  28. Ron

    Lots of things…..whats your point?

    My point is that if you think prices are going to continue to drop…then why buy now?

    Why wouldn’t you wait till you know (with your superior insight into the market) when we actually hit bottom and then buy?

  29. Dave

    I have a number of years of experience in RE and I can’t believe what I’m reading here. This is the standard line from brokers trying to act as cheer leaders for an industry that rode a bubble to unsustainable heights and now has to undergo a huge correction that naturally owners and many brokers don’t want to see.

    I’m disappointed in this post. There is no balanced insight here. This is an article saying only savvy brokers or industry experts can determine value and what a proper price is. Industry experts are in large part what got us into this mess.

    Prices are set today by buyers and what they’ll pay. End of story. And yes, buyers need to see a fair number of units for product knowledge. I do not know any serious buyers that do not do this.

    Brokers do not make the market. Recent comps don’t make the market. In fact, to any intelligent buyer recent comps are almost worthless. We are on a downward curve, you have to get ahead of it. Comps are interesting as a measure of recent history, they do get factored in to some degree in setting the risk discount to deduct from asking, but they do not determine price. Especially when fear and uncertainty rule the day. Though denial is yet strong in quite a few people, obviously.

    What Lori or any other broker thinks a property is worth or should be worth is meaningless to anyone of normal IQ. Clearly sellers can set any price they want, but it is rising inventory and sales volumes that best indicate what is happening in a changing market, not comps, broker opinion or any other opinion. Sales are down over 50 per cent, which speaks for itself.

    It is what is in a buyers mind that sets the market, like an earlier poster said. There will always be a few deals in any market. Fine, a particular buyer agreed with the sentiment of a particular seller. For that unit, that was the price at that instant in time. But that does not mean that is where the market is at for the majority. When most units are not moving, they are overpriced.

    It is primarily buyer confidence and all the factors that affect that confidence that sets the price. Job security and availability of credit count of course. But anyone with any savvy can see prices are coming down further, so most are not going to overpay.

    Of course it is a judgment call as to how far prices will fall, but 30 minutes of researching trends will tell you that the probability is they will fall 30-40 percent below peaks, maybe more. Those that don’t want to believe that may buy today at $500-600 per square foot. Fine for them, clearly that is where in their mind the value is. Most educated buyers however will not buy at those price levels. If it were otherwise, deals would be happening in much larger numbers. Clearly this is why the market is at a standoff.

    When sellers become distressed enough to sell at prices most buyers are comfortable paying, given all of their uncertainties and reasonable expectations about pricing trends, sales will pick up significantly. In my view, it will stay a trickle for a long time until prices come back to sustainable price to income ratios. To me it is evident by sales volumes the majority of potential buyers share this view.

    And finally to say buyers are ignorant or wrong is simply untrue and unnecessary. They won’t buy without confidence, and there is nothing to observe in the broader landscape to give most of them confidence to pay prices that are still often at best 10 percent below peaks.

    If an owner wants to sell, he or she will have to meet the buyers price. They are in the driver’s seat. Otherwise it sits and there is no value price until someone capitulates. Financial distress unfortunately is what will ultimately determine the pricing realities for most sellers.

  30. homeboken

    Tiger – I agree with you, but as Lori’s weekly analysis points out, supply is increasing consistently. Demand seems to be at or near all-time lows. In my mind, there there simply is no market at this time. Attempting to price property, by buyer or seller, is extremly difficult when the market does not exist.

    Remember, in the supply and demand equation there is a significant difference in moving ALONG the curve and movement OF the curve.

  31. Lori Turoff

    Dave – if you think I’m a cheerleader you’re simply wrong. Many readers appreciate and recognize that I give a balanced view of the market as best as I am able. Because someone does not agree with you does not mean they are stupid anymore than it means that you are stupid. You’re free to voice your opinion here but if you attack others for their views you will not be welcome here.

  32. Ron

    “Brokers do not make the market. Recent comps don’t make the market. In fact, to any intelligent buyer recent comps are almost worthless. We are on a downward curve, you have to get ahead of it. Comps are interesting as a measure of recent history, they do get factored in to some degree in setting the risk discount to deduct from asking, but they do not determine price. Especially when fear and uncertainty rule the day. Though denial is yet strong in quite a few people, obviously.”

    This is classic “We are on a downward curve, you have to get ahead of it”

    Almost as bad as “buy today or get priced out forever”

  33. Laki

    Tiger – that is precisely what people in Cali were saying in 2006 – eh its not that bad we’re down only a little. But right around that time the transactions totally dried up. People suddenly stopped buying at those inflated prices. And naturally the prices started going down for real in late 2006.

    And this is exactly what’s happening in NYC right now. The prices haven’t started going down yet – but the buyers have disappeared, and the prices are clearly inflated based on where they were historically.

    If you think that prices can stay at these high levels, you have to come up with an economic argument. Who is the marginal buyer that can take out the marginal inventory? If you honestly try to answer this question you will realize a thing or two. Overal, the transactions haven’t dried up because a handful of buyers out there are holding out for a better deal. The major cause is that there are simply not enough people out there that can afford these apartments. Sure you can say – 2 married lawyers who each make 200K a year plus a bonus, can afford such and such place. But that’s one apartment, and there are hundreds of thousands if not millions of them out there in the New York metro area. If 5% of people need to sell in a given year (for whatever reason, people move, people divorce, they get in financial trouble, whatever) – you need to come up with that many marginal buyers. If you do some serious analysis on the population of New York (income distribution, employment trends, bonuses, availability of credit, etc etc.) you will realize that there is NO WAY there are that many people out there with incomes high enough to be clearing up marginal inventory.

    So unless prices adjust dramatically, inventory will keep going up and up and up.

    RPX forwards also tell the story. According to forwards, New York MSA will experience the steepest decline in 2009-2010-2011 in the whole country.

    And once the real declines start, that’s when everything starts becoming apparent and the trend becomes a fulfilling prophecy (much like the upward trend was a fulfilling prophecy in 2000-2008 period). People with negative equity default… if you live in a building with meaningful number of defaults, your common charges and maintenance fees go up, hence you default too… all these defaults add more inventory, hence prices go down even more… and so on…. it becomes a vicious cycle.

  34. patk14

    Laki hits on some key points. The general feeling from rational people in the current economy is that their job security has been reduced and that future income will likely be reduced. During the period from 2003 to 2006, incomes (especially finance) were increasing at a rapid rate making people feel confident enough to “pay up” and lock into burdensome mortgages/taxes/common charges. They felt that their income would catch up with their payments and they would also enjoy a windfall on their shrewd real estate strategy. Well, the music has now officially stopped. No one is willing to stretch to buy a place. Many don’t know if they will even be working in this area in a few months. Cash is king. If I were a seller, I would discount my property ASAP to get a deal done before the price falls further. The comp from January is not a valid comp for April. This is not a temporary storm that will blow over in 2009 and everything will be peaches and cream in 2010. This is the worst economic cycle since the 1930’s so we’ll probably have to see real estate prices decline to mid-1990’s prices (adjusted for inflation and the fact that many Hoboken apartments have been seriously upgraded since then).

  35. homeboken

    Laki and patk14 offer some interesting points. I will supplement with some ideas about generational ideals that were presented at a recent housing conference.
    The crux of the issue is that the new “starter home/condo” buyer is usually the single or married couple aged 24-34 (#’s not exact).
    They presenter went on to say that the first-time or starter home buyer is most likely a member of Gen Y. Gen Y’ers have grown up computer savvy and with much more advanced technical skills then previous generations. However, Gen Y also has the least “real world” experience and smalles universe of business contacts when compared to Gen X, or Baby Boomers.

    The conclusion was that in an unstable jobs market, Gen Y will leverage the one major advantage they have, which is mobility. Gen Y is likely a renter, and can easily (perspective) move to where the new job center is located. Gen Y values this mobility and realizes that it will be the difference between an unemployment check and pay-check.

    If Gen Y buys/owns they lose the mobility…at least for a period of X years, when the housing market allows for transactions to occur with more velocity. Further, the growing family looking to sell their 1BR condo or starter home, now has a smaller universe to sell to. They now have difficulty moving up to the larger home they want. The problem in effect trickles up.

    Disclaimer – this was a multi-family housing conference and the message was clearly skewed to fit the audience of Landlords/Apartment owners.

  36. stan


    I posted a comment 8 hours ago, it says it’s in moderation I think. thanks

  37. stan

    oh, and Lori isn’t a cheerleader, I find her viewpoints pretty honest as far as recent trends. She is a an educated realtor who actually does a service to her clients, which unfortunatley is a rarity.

  38. parkave

    I agree with stan, lori is a hard working, honest and professional realtor. I would trust her more than any other realtors in Hoboken. Her blog is open forum for us exchange opinions about Hoboken real estates. I appreciate the fact that she created such venue. Good job lori!

  39. Tiger

    Dave – We appreciate your opinion but there’s no need to go on attacking people. That whole IQ argument is not necessary at all. So anyone who doesn’t agree with your ‘end of world’ story is stupid? And does not have a ‘normal’ IQ?

    I for one value opinions from both sides of the fence, sellers and buyers. I am neither, and probably won’t be for years, but definitely interested in the market. Oh yea, and I happen to have a high IQ thank you very much. But I don’t walk around tell people that they are stupid and have below average IQ if they don’t agree with me.

    Also, I second stan and parkave, Lori is an honest Realtor who does a great effort separating her own interest from her blog. There are many blogs about jersey city and Hoboken real estate but they all sound like sales pitches.

  40. dkzzzz

    Great discussion folks. Thanks for a lot of good points.
    American’s mobility is one of the major drivers of this RE market, someone pointed that correctly.
    Unfortunately that is why very few places in US have real neighborhoods today. This mobility which is praised a lot by our politicians in actuality destroys communities, families, relationships with friends, not to mention it is very traumatic for school-age children.
    Unfortunately a lot of Americans are nomads with no permanent home.

  41. homeboken

    dkzzzz – Re: Mobility

    You are correct. The idea of community and true ownership is a value that is quickly losing its place in the world. When you go to an area where the neighbors know and speak to eachother, know eachothers kids, etc. it strikes you as a real nice place to raise a family.

    It is all about incentive. People are not incented to plant roots and work at a company for 30 years anymore. The rate of change in our ecnonomy forces workers to sacrifice community for the sake of mobility. It is an unfortunate side-affect of the modern economy, but I think the idea of a community will be dead by the turn of the next century.

  42. Willy

    Statistics are always a dangerous tool for those who have little experience with them. Sales activity is the barometer for the health of the market, not price! Price follows.

  43. Lori Turoff

    I have spent quite a bit of time (18 years of at least 6 trips a year, often for several months at a time) in Italy and one of the biggest differences in their society and ours, besides the food : ) , is that Italians don’t grow up and leave their home towns or cities very often as Americans do. They tend to stay in or nearby their place of birth unless they are from a super remote area. As a result, they have an incredible local network of friends and extended family and deep ties to their community. It’s a pleasure to see how these communities pull together in a time of need, such as the earthquake in Umbria in the mid 90’s. We miss out on the benefits of that sense of community here in many ways. That’s much the result of being a country full of immigrants with much shallower roots than those in Europe. It seems, though, that much of the new ideas in urban planning are focused on creating communities with central, walkable downtowns served by public transportation hubs. The prevalence of the car & highways and spread out suburbs that I like to call sprawlies increases our lack of community. Maybe that’s starting to change a little. I think Hoboken benefits from having a small geographic area where we do know each other and there is a community. Now if only people would choose to stay here for good!

    I also think – and this is just my opinion based on living here for a decade – that there have been fundamental changes in Hoboken for the better that have cause some portion of the past increase in real estate prices. 10 years ago, Hoboken had no supermarket, no Starbucks (not necessarily a bad thing but you get the point), no new construction on the west side of town. Hudson Tea was a shell, Maxwell an abandoned factory, and the waterfront a disaster. The saying was ‘stay out of the President streets’. After the urban flight of the early 80’s (see “Delivered Vacant” available at the Hoboken Historic Museum for back story) people started moving back here, improvements were made and Hoboken became a much more desirable place to live. Upscale shops, fewer low-end rent controlled rental units, less crime, fewer abandoned building etc. Doesn’t the great improvement in the neighborhood have to account for some degree of the increases in property values?

  44. Tiger

    Re: Communities – I think this issue is more obvious in Hoboken than any other city I have seen. I travel quite a bit for work and worked in all sorts of cities around the country. Hobokenites are a bit self-absorbed. This is not to say they are mean, but I guess this is how it is. I hope if something good comes out of this bad economy, that people humble down a bit and become a bit more open and in contact with their community.

    As for values, even if they go down drastically, there’s always a silver lining. I think once you own a home, you will never go back to renting (unless your circumstances dictate so). So basically, you would sell at a loss, but like Lori said in several earlier post you can make up for it by buying cheaper somewhere else; and don’t forget, we still have the two year advantage over the rest of the nation; so whether you next move is a few blocks from where you live, to Millborne, or to Texas, you will still realize significant savings on your next place. Yes, maybe you would have saved more have you sold at the peak and bought at the bottom, but I guess there’s more to it than money. It is home.

  45. AL

    Hi Lori, I am Italian and moved to NY in 2001 and to Hoboken in 2004. I have to agree with you regarding the sense of community over here. The job mobility that many European countries envy to the US has some negative side-effects. It weakens the stability of the community and it weakens the stability of the family.
    Moreover, the city planning in the US seems more based on convenience and efficiency than on creating a stable community. That’s probably because US cities are relatively new cities compared to European cities. The city planning in Europe has to handle centuries of history of many buildings, roads and infrastructures. Would be close to impossible to revolutionize or simply change that. And consequently traffic is terrible. You can not remove a square from an Italian town to put a 4-lane road to speed up traffic … at least not yet.
    When I look at NYC, for example, even after 8 years of work here, I am amazed by its efficiency under many different aspects like synchronized traffic lights, large avenues, … but … there is no “center” of the city … Time Square? It’s not a square. Central Park? There are parts of the city that have more of a feeling of community but again there is something missing. There isn’t really a city “meeting point” … a “piazza” (square). If you visit Italian villages, towns and even cities you will find “piazze” (Piazza S. Marco in Venice, Piazza Duomo in Milan, ….), often partially or totally closed to the traffic, often with churches, where people go to stroll, dine, watch other people, be watched, meet for aperitifs, hang out or simply enjoy a coffee.
    The typical center of town in the US seems to be a road, with restaurants, shops, maybe a cinema. But, it is a road. Not a “piazza”. Hoboken is exactly like that. The center of Hoboken is Washington STREET, not Washington Square. The suburbs then are even more spread out and in order to get to the center of the typical suburb town you need a car, therefore you need a road that brings you there and that road likely cuts through the center of town.
    Anyway, I did not want to say that European cities / towns are better. I simply wanted to point out how they are different and how the city planning can affect the sense of community.
    I doubt that Hoboken will or can become a close community. The flow of temporary residents is too high: you have students, new families, new graduates working in the city that all have a short time horizon which they intend to spend in Hoboken. The schools are not the best here and there are some areas of town that affect this factor. Then of course there is a core of Hoboken residents that put its roots here and probably will remain here for a long time. But I doubt that this stable community can grow much … and I believe it might be better like this.

  46. Lori

    Could you imagine – Washington Street a cobblestone paved pedestrian zone with a row of outdoor cafes down the center in the summer; a big piazza in front of City Hall and another at the 14th St. end; a ‘circonvalazione’ or bypass road around the back of town along the light rail so cars would avoid cutting through the center of town; one way streets that would make it unfeasable to use the residential center Hoboken as a shortcut from the Holland to the Lincoln; and a true, buffered bike lane in each direction along the river. Oh well, too late. So many opportunities to improve street life squandered over the years. But it’s nice to dream.

  47. potential_buyer

    Awesome discussion everyone – good points from both sides of the fence.

    I just made an offer not to long ago on a place in a prime location. Offering price was ~13% below asking, but it had been on the market for a good 60 days already and, to my knowledge, no one had even taken a bite at it. So the return offer was their listing price? Now I hear what Lori is saying, and agree with her to a certain degree, that placing repeated bids of -25% of asking doesn’t get you anywhere, then one needs to reconsider his/her strategy (or just wait it out, as the sellers are not desperate yet). My situation clearly showed me that this particular seller wasn’t willing to budge (or even meet me in the middle) – I as a buyer with time on my side walk! No need to get upset or emotional, as I too believe that things are going to continue to get worse before they get better.

    Someone made a comment about the California market. Well, I lived in Riverside for 5 years and saw first hand what was going on in that market. I left for the bay area where I was at for the next 5 years, and also observed the run-up in prices throughout the area. It clearly wasn’t sustainable and their bubble has burst big-time. I haven’t been in Hoboken for long, but I truly have the sense that the Hoboken/NYC market has quite a bit of correction left in it. I personally don’t believe it will be to the 35% reduction in other parts of the country, but it very well could hit a 25% mark. I would think that sellers would understand this and try to get out for -15% (which is still a net gain for many folks), but alas I was proven wrong. Hence, I wait…

  48. Tiger

    Potential_buyer – sorry to hear, but stick to your guns man! That’s what I’m talking about, sellers who are not serious, and unfortunately they flood the market with inventory that will not sell. I bought last year, before the ‘bottom fell’. My offer was 10% below asking – on a unit already discounted 5% for a quick sell. The seller countered it at 9% below asking five minutes later. DEAL – we closed in 30 days. And that was in the day when Hoboken sellers wouldn’t give you 1 or 2% off. My point is – serious sellers will at least attempt to meet you somewhere in the middle.

    Good luck on your next unit!

  49. potential_buyer

    Yeah, it was a shame too as I really liked the place, but I am not willing to pay a premium (first, it is not in my nature to do so, and second, well, needs to explanation).

    Came across an interesting article on Yahoo finance which I think sums things up nicely, particularly on the advice to buyers & sellers…


  50. mls

    Potential Buyer… same thing happened to us. Actually worse… they rejected our offer and never counterd. Here’s the breakdown. Selling Price was 533k. We offered 501k. We were willing to go up to 520k but wanted to see where the buyer stood.

    The place has been on the market since January. Too bad for them b/c months have passed and they have lost out on a lot of mortgage payments. Now I’m glad they didn’t accept our offer. If I were to put an offer today on the same unit… it would be for 485k. Good luck 233 Monroe St.! The balcony’s are now needing major repairs, so a huge assesment is going to happen.

  51. Lori Turoff

    I have to wonder what these sellers are thinking when they won’t negotiate. I had a seller’s agent tell me the other day, when we were having some issues coming to terms on some inspection items and my buyer wanted to be sure everything was fixed, “well they don’t have to sell, it’s a family owned property”. Who is their family? Rockefeller?

    On the other hand, there was an exceptionally nice 1BR I showed to one of my buyers that was listed at $399K. It was vacant and had been on the market for under 90 days. Great building, great location, great space and over 800 sq. ft., great condo ass’n. w/ very strong financials, professionally managed, this unit really had a lot going for it. My buyer wanted to offer $320K. (he later changed his mind and did not). The next week there were 3 offers on it. I bet it went for full price.

  52. Smith

    I work in the finance industry and the complete carnage and loss of jobs and pay on Wall Street is amazing and completely UNPRECEDENTED. There are so many people who are out of work and have little to no chance to find a new one. Their days in NY are numbered and they will soon move back to Minneapolis, St. Louis, Cleveland, etc where they have a social network to support them as they look for work.

    The folks at many investment banks got paid bonuses that are 10-25% of their previous year bonus, and the expectations for this year are even worse. This is a COMPLETE reversal of bubble type compensation that saw annual increase by 20-50% per year. New York is raising taxes and jobs are going away. Services in NYC are being cut. If you look at NYC growth of the financial services sector, it is a bubble that is bursting and will impact NY 10x more than California.

    There is only one place real estate prices are going, and that is down. Who is buying in the City now – nobody. I am not surprised at all by the post that shows NY population declines in the future. NY in the next 10 years will trends towards the the 70’s more than the late 90’s. 1975 in NY was not glamourous or even safe, and all fundamental indicators are that it is headed in that direction again (hopefully not as bad). It’s amazing that people kept saying “NY is immune from the real estate correction”, etc — just the same thing said about the broader market only 2 years ago. I see only 5% price correction in NY after bubble price appreciation and head for the hills with my checkbook locked away.

    Any commentary on the market being buoyed by foreign buyers — their losses in the last few months or year on FX alone are huge. Wait until the USD price starts correcting and they all stop buying here. And the market is still propped up by so many speculators and flippers who are going to face the financial distress scenario another poster mentioned.

    Hoboken is akin to a “fringe-type” NYC neighborhood that will experience material price decreases – I don’t need a crystal ball to see that. The lack of transactions is an obvious indication of where the market is going. I’m from NJ, met my wife 10 years ago in Hoboken, and lived here for 4 years now, renting and waiting for my ability to buy to increase — so I have no negative bias to Hoboken and like living here. But why on earth would I buy now when I can keep renting and not worry about putting out a couple hunno and hoping the market stabilizes and I keep my job? Seems like almost everyone agrees with me as evidences by this fantastic blog’s weekly reports, and the only Hoboken transactions I see every week are the sub $500k West Hoboken locations that people can afford. There are no buyers out there in the upper 6-digit range for 550+ per sq foot, which some people on this thread believe are the “insulated” properties. They are going to decrease by the greatest percentage as the city has a mass exodous and buyers choose a materially repriced NY over Hoboken.

  53. potential_buyer

    Amen Smith

  54. Smith

    Lori, you referenced a $500+ sq. ft. selling price in a previous post, which I believe is an average. What is the median price per square foot? Thanks.

  55. Lori Turoff

    Smith – if you go back to the February numbers chart you can see all the square footage and median prices so you can calculate it for any month, but the number for median price per sq ft for Feb 09 comes to $414 versus $516 for average price per sq ft. I think all these numbers are being skewed a bit by the sales at Maxwell and Garden St. Lofts, (which I finally saw this weekend – where exactly is one supposed to store food and dishes in those kitchens?).

    Here’s the link to the chart: http://hobokenrealestatenews.com/2009/03/02/the-hoboken-condo-market-the-february-results/

    Thanks for your comments and viewpoint!

    MARCH results will be posted this week so stay tuned.

  56. Smith

    BTW, my understanding on GSL is that those purchases were closed a while ago and that there is a timing issue. There is no way that 2 penthouses got sold in one week — these properties were listed as sold weeks or months ago on the GSL website but only recently came into the available data.

    I consider the recent GSL data points as stale, if anyone sees I’m missing something let me know.

  57. Lori Turoff


  58. Tiger

    Thanks Smith – that’s a very good argument, but saying that jobs are never coming back is extreme, I’ve heard it all before.

    I’m not an expert on the financial industry but let me tell you about mine, IT Industry. I finished my BSc in Computer Engineering in the ‘doomed’ year 2002. The stock market crashed, 9-11 attacks only a few months ago, and a new wave called outsourcing, was taking the country by storm. Literally overnight thousands of labs and development centers were closed and jobs were shipped overseas. Headlines in WSJ and NYT were saying how IT is no longer a good career option.

    Stevens has always boasted that over 90% of its graduates would have secured a job/ grad school by the time they graduate, our class’s was closer to 30%, less than half of which got jobs. This was the lowest in Stevens 100+ year history. Sophomores and Juniors in Computer Engineering and Computer Science switched majors. It was over, who would want to be in IT anymore?

    For me personally it is something I enjoy doing so I kept on, I went to grad school. Now, the year 2003 was bad, 2004 was even worse. But in 2005, companies started realizing that cheaper isn’t necessarily better, that you need IT team to be close to business to develop feasible. SO yes, IT jobs were back and stronger than ever. They evolved (to the better), became more challenging and demanding, but they came back.

    Like I said I’m no expert, but I’ve seen the scenario where ‘jobs are gone and never coming back’ actually did come back. Why is it hard to believe that something like that would happen in an even bigger, more fundamental, and stronger industry?

  59. Willy

    It IS hard to believe for one simple reason. The TYPE of stimulus that was applied and the type of economic contraction at those previous points were COMPLETELY different from what we are experiencing now.

    Not only will those jobs NOT come back, neither will those property prices for a VERY long time. Hence, the stagnant interest –> stagnant pricing –> stagnant inventory.

    Basically, real estate does NOT benefit from the necessary economic policies we are currently undergoing. Real estate is being cushioned for a SOFTER landing but NO REVERSAL in trend is possible unless prices fall MUCH further.

    Even then any rise in prices is not probable until inventories become EXTREMELY short in supply. That my friend, is a LONG way to come; even in convenient Hoboken.

    We are just beginning to witness the contraction in RE offices in town. Until those numbers get realistic, there is still a denial problem in the eyes of sellers and related RE professionals.

    The few that are beginning to get AHEAD of that curve will be very thankful they took the deal albeit at a price lower than their expectations.

  60. Pat

    I have to agree with the doom and gloom crowd here. I too work on Wall Street, and it wasn’t until this Winter and bonus season, that people really realized the world has changed. I don’t know how much people are making in other businesses in NYC, but a Vice President could have hope to make upwards of $400k..now they will be happy half that. And there are less of them. I don’t want to be a gloomy guy, but the higher end Hoboken real estate (ie Maxwell, W) is going to get crushed. No one is going to pay $900,000 for a 800sq ft 1 bed in the W. you could easily move to Manhatta for that. I think higher end condos and 1 families will easily see 20% price declines from HERE, if not as much as 40%.

    there is like 2 yrs supply of inventory and I expect more offerings to come due to layoffs…

  61. Smith

    BTW, I don’t think job loss in NY is permanent. But it is SOOO real and has NOT yet taken true impact on the local economy. NY is in a down cycle and not even close to bottom. Not many people can remember the 70’s in NY, but that was also a down cycle to say the least and that is the direction (if not the end point) we are headed.

    Will NY cycle up again? Yes. When? Not for several years. We could be entering another lost decade, and if not we are at least entering a downward trajectory for 1-2 years more.

  62. Tiger

    Thanks Smith, that’s what I wanted to say. Wall street as we know it could be gone forever, but I can’t wait for the new reinvention. There are many brilliant and talented people here and I’m sure something else will come up!

  63. Helping Hoboken Moms Sell Their Condos » How do I sell high but buy low?

    […] The prevailing wisdom right now says that “Those looking to sell their properties will have to be both bargain-hunter and bargain-provider, listing their homes at prices sensitive to their particular markets.” When we first listed our 2BR at $550k, we had no intention of taking any less than $520k. That # got adjusted down when we found the 4BR we wanted to buy. We thought about waiting the seller out because we were pretty sure the purchase price would come down, but the problem with that approach is that the sale price for our 2BR would also go down. And my sense of the market is that the value of a 2BR will drop a lot faster than a 4BR (classic supply and demand; there are 287 2BR units on the market and only 54 3BR+ ones). […]

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