2010 Nov 10th

The Weekly Wednesday Wrap Up – Hoboken Condo Sales & Activity for the Week of November 11th

Hoboken Condos Sales & Activity – Week of November 10th

Technical problem fixed!

We’re back from New Orleans with lots of new information and ideas. Here is a sampling of what was presented:

[youtube width=”325″ height=”244″]http://www.youtube.com/watch?v=hSbP_mt2FOg[/youtube]

Finally, there was a presentation by Dr. Lawrence Yun, NAR’s chief economist, and Dr. Tom Hoenig, the President of the Federal Reserve Bank of Kansas. Both speakers were of the opinion that the deflation of the bubble has occurred. Dr. Hoenig has some interesting ideas about how to revive the housing market going forward, focusing on a reduced role for governmental intervention and public subsidies that he believes have distorted the market over recent decades. Fix Fannie & Freddie, and return to sound lending principals were the basis of his plan. The two differed only over the continuation of the mortgage interest deduction. It’s easy to criticize statistics and forecasts and to find conflicting predictions. Nonetheless, I’d rather have more information than less.

Back in Hoboken, inventory is down but the holidays are almost upon us. The word on the street is that it is very, very difficult to get a loan unless you have stellar credit and 20% to put down. Even with today’s unbelievably low interest rates, that hurts our market where we have many first time buyers, few of whom have 20% saved, and very few FHA approved buildings which would allow a buyer to obtain financing with a lower down payment. Do future buyers have to change their spending and credit habits and start saving more? It seems so, at least for the near future.

Disclaimer: The data relating to real estate transactions on this web site comes in part from the Hudson County MLS. While some of these listings are, in fact, our listings they are not ALL our listings nor do we hold them out as such. Century 21 Listings are identified with “C21” after the address. Other listings are from the MLS and are identified with “MLS” after the address. Information is deemed reliable but not guaranteed.

Studio & 1 Bedroom Hoboken Condos:

8 new listings

3 Dabos

4 Sold

4 price reductions

168 Total Active 1BRs

Two Bedroom Hoboken Condos:

12 new listings

5 Dabos

4 sold

9 price reductions

241 Total Active 2BRs

Three Bedroom and Larger Hoboken Condos:

1 new listings

3 dabos

3 sold

2 price reductions

45 Total Active 3BRs

Hoboken Condo Open Houses

If you are in the market for a Hoboken condo, our Hoboken Open House Google Map is your best source for locating every open house in Hoboken. It is the single, most complete listing available and we were the first ones to do it. We compile the information by hand from all possible sources to provide you with all the information you need in one spot. It’s posted on Friday every week.

Want to Receive New Listings & Price Reductions Daily?

If you would like to be emailed the new listings and price reductions each weekday in either 1br, 2br or 3br categories just email us at [email protected] letting us know which size(s) you would like and we’ll add you to the daily email list.

For more information you can always contact us at 201 993 9500.

Thanks for reading and, as always, we welcome your comments!

  1. Lori Turoff


  2. Craig

    I find it curious that one of those two speakers would even suggest eliminating the mortgage interest deduction. While he’s at it, why not rid us of the real estate tax deuction too? That would essentially be the final nail in the coffin of the real estate industry. In high cost areas like ours, the tax deductions are the main reasons that buying is a viable alternative to renting. Without them, almost no one would buy anything because renting would make much more financial sense by far (unless there’s another bubble and thus huge instant returns on buying property).

    The 20% down requirement is another hurdle in high cost areas. In places where real estate costs are reasonable and you can get a nice home for $250k like what you usually see on House Hunters (love that show), requiring people to bring 20% to the table is not unreasonable. But here a decent home can run $500k to a million or more. That’s at least $100k in cash you have to bring to the table.

    How many people realistically can save that much cash with the high cost of living we all have here? Unless you are wealthy or coming out of another home you’re selling that actually had some equity, a tiny percentage of the population will ever have that kind of money. I think lending standards should adjust for region and how much income a buyer can demonstrate. The more you earn and the higher your credit rating, the less of a risk you are – your required downpayment should adjust downward to be reflective of that.

    As an aside, my experience was getting a loan for a single-family home is much easier than getting one for a condo. I’m not sure why that is – maybe Lori can shed some light on that. That’s another thorn in Hoboken’s side in addition to the lack of FHA approved buildings (FHA spot approvals for individual units have been eliminated).

  3. Lori Turoff

    We may be in a higher cost area but our salaries are also higher, no? As for why it may be harder to get a loan for a condo, and I don’t know for sure that it is although interest rates are higher for condos than for single family houses, I think the banks see added risk in a condo in that there are other unit owners who can influence your unit. That’s why banks nowadays want condo associations to have adequate reserves, not too many investor owners, complete books & records, etc.

    Getting rid of the interest rate deduction is a serious proposal among some lawmakers, thanks to the growing budget deficits.


  4. homeboken

    Lori – links are leading to a dead-end page.

  5. Chris

    Great information. Thanks.

  6. homeboken

    Lori- Did the NAR have any thoughts on what effect removing the mortgage interest deduction would have on demand/pricing?

  7. Lori Turoff

    That is strange – try the link again because it works for me.


    The person who really spoke about the mortgage interest deduction was Dr. Hoenig. He said it would result in huge a redistribution of wealth. He didn’t come out for or against it but was just pointing out the affect of it. Dr. Yun, of course, was against it. The proposal I’ve seen eliminates or scales it back based on income starting with those making over $250k.

  8. Laki


    I hope this plan goes through. It eliminates mortgage interest deduction along with all other tax breaks. It’s encouraging because it came as a joint proposal from the republican and democratic leaders of the debt commission.

    Craig to answer your question how would people afford housing if there was no mortgage interest deduction? Well initially they wouldn’t, but then pricing would come down as there would be no demand at current subsidy-inflated price points and eventually new equilibrium would be reached and life would go on.

  9. a

    links are broken.

  10. carl

    I am having the same problem with dead page

  11. carl

    I love it back to the false premise that if you make 250k you are rich. It looks like they took a bunch of proposals that have already been out there and just released them to see what sticks. Can’t get rid of mortgage interest deduction in this housing environment. And when housing is better the deduction would have to be phased out. Didn’t see a mention of a VAT which I know dems are pushing hard

  12. keepitinflated

    The horrors. I agree if people had to save and property taxes and interest were not deductible home prices would have to fall. In the future children would need to live without hardwood floors, granite countertops, stainless steel appliances, and soft touch kithchen drawers. This is not the America I want, high prices forever.

    BTW Craig I thought you said people will pay high prices causes they have to. Are you now admitting that a variety of government supports including FHA made it easier for people to spend more than they otherwise could?

  13. homeboken

    I agree that it is not surprising that Yun was vehemently against repealing the mortgage interest deduction. I do find it a bit odd that Koenig viewed it as a redistribution of wealth.

    I suppose in a way, it is a redistribution, but not from wealthy to poor. It would be from current owners to future owners.

    A current owner is locked in to their current mortgage ammortization table. Meaning that the interest payments they make each month are fixed, and the tax deduction they receive is also fixed but acts as a nice off-set.

    If we assume that prices would drop due to the lack of the mortgage interest deduction (and I can’t see how you argue they wouldn’t) then the new buyer benefits.

    I think the very idea that this language is being discussed is enough to spook a potential new buyer from getting to the closing table. Why take the risk that the deduction could go away? Either price it into the offer, or leave the deduction in place. The uncertainty around the issue will only lead to more gum in the engine.

  14. Laki

    Mortgage interest deduction is actually a subsidy that renters pay to owners. I’m a renter and my tax dollars are used to give someone else who owns a house a deduction …. Why am I paying for this? This makes very little sense, all it does is it destords the market equilibrium and pushes up home prices. It is not at all clear to me how this benefits the society. But then again this argument could be made about the entire tax code which is a collection of thousands upon thousands of esoteric rules designed to arbitrarily benefit some groups over others. Why?

  15. Laki

    Corrections: renters pay for the subsidy and the benefits are only partially enjoyed by the home owners…. most of the subsidy ends up being consumed by the housing industry through higher home prices that the owner ends up paying (so the ultimate beneficiaries of the subsidy are banks, home-builders, realtors, etc.).

  16. Lori

    Sorry guys – the links are fixed.

  17. keepitinflated


    Many of the rules and regulations we have are meant to transfer wealth from the young to the older. Home interest deductions makes existing, typically older, homeowners richer (as well as homebuilders).

    Originally it was likely a good hearted proposition on saying society benfitted from homeownership and in order to assure homes could be built you need to subsidize them. Currently it supports making sure granite countertops are subsidized by all taxpayers.

    I think several economists have commented on how this has hurt society. A huge housing bubble that created the deepest recession in 70 years and it now has yielded an inflexible work force that is unable to move to where job opportunities exist.

    Other than that homes are priced perfectly.

  18. morally_right

    If most people cannot make the 20% down payment, that tells you all you need to know about current prices and where they’re heading.

  19. Tiger

    I don’t see tax deductions going anywhere anytime soon, I think they’ll wait until ‘recovery’, whenever that is, and **gradually** start pulling the plug on it. So for example, it starts with deducting 90% , then 80%, etc… all the way until it eventually phases out completely.

    I don’t think we can afford for the housing market to collapse, again.

  20. stan

    thanks as always lori.

    that 100012576 1100 clinton asking for 479 is well below its last sale, was in the 600’s in 2006. Looks like a nice place.

  21. whynot

    This is wrong:

    “The word on the street is that it is very, very difficult to get a loan unless you have stellar credit and 20% to put down.”

    The only issues with loans have been appraisals. As long as your salary is okay, 10% is more than acceptable.

  22. UPennAlaskan

    In many Asian countries, the convention was to pay 100% of the purchase price in cash. The concept of a person with a middle to upper-middle class job that could afford to buy a home without family money was unheard of. Even today, down payments minimums are often 50%+. 20% DP in terms of a global context is rather low.

    By definition anytime a line is drawn or redrawn it is a wealth transfer/redistribution. There are always new winners and losers.

  23. Lori

    Whynot – what mortgage broker or banks do you know that will make loans for 10% down? The ones my buyers deal with have been unable or unwilling to write conventional loans with less than 20% down because the PMI has disappeared.

  24. Craig

    Lori, Trustco offers mortgages with 10% down. My brother used them to buy his house with 10% down. They wouldn’t lend to me with 10% down because they wouldn’t finance condos for less than 20% down. They offered me a 10% down mortgage only if I would buy a single family house.

  25. patk14

    Agreed that any removal of the mortgage interest deduction would have to occur over a long time period. Many recent buyers made their decision based on the value of this deduction and removing it would crush them financially.

    Currently, the government is doing everything possible to prevent housing prices from falling further. They have created historically low interest rates and basically guaranteed all mortgages so that banks will keep lending. These are huge subsidies to homeowners (and real estate speculators). Those being hurt are 1st time buyers (generally younger people without a long term earnings history or able to save 20%). I’d be shocked if they reversed course and disallowed the mortgage interest deduction or real estate tax deduction. Falling housing prices would result in much larger losses for the nation’s banks which would have negative growth implications for the economy.

  26. Lori

    I’m sure you’ve all heard or seen the news by now of the committee report on the budget deficit and what needs to be done. It seems there are no more sacred cows. Of course, by the time any of these ideas are actually implemented they will be phased in over many years or watered down or they are highly unlikely to ever pass.

  27. Craig

    If they phase out the mortgage interest deduction disaster would ensue. The resulting massive drop in property values nationwide would pretty much guarantee that no current homeowner would ever gain equity in their homes. You’d probably have 80% of the nation permanently underwater in their mortgages. You think a high number of people are strategically defaulting on their mortgages now? Wait and see how many do it if the mortgage interest deduction goes away. Banks would lose billions. The banking lobbyists will never let it happen.

  28. morally_right

    If lawmakers reduced the bar to $700,000 for not allowing a mortgage deduction on any loan above that amount, I think the vast majority of Americans wouldn’t be affected. This might make it politically possible. Then, if they have to, they can reduce the bar by $50,000 every other year or something like that.

  29. homeboken

    Craig – what you say might be correct, but doesn’t this mean that housing prices are still drastically inflated? If the removal of the interest deduction would throw thousands into an underwater situation, then it means that thousands of people overpaid for housing.

    The margin for safety can’t now be so tight.

  30. Tiger

    My problem with most tax reforms from Washington is that they are living-cost blind, period.

    For example, regardless where you are in this country, if you make more than than 125K or so you are already considered in the top 10% or so. I think lowering the limit for mortgage deductions above a certain absolute number is dumb; 700K gets you a mansion in Atlanta, a three bedroom in Hoboken. Similarily, someone who can afford a 700K mansion in Atlanta probably saves more money and has a better life quality (in terms of how far their dollars go) than someone in Hoboken.

  31. keepitinflated

    Oh dear Craig

    Since 2007 over 95% of mortgages have been guaranteed by the government. What mortgages are the banks going to lose money on.

    Second, “They will not default cause they know that price is what they must pay, especially if they want to be close to the PATH”. Are you saying that a variety of government suvbsidies and incentives have propped up home prices. hard to believe

  32. Laki


    So why don’t you move to Atlanta? Nobody is forcing you to be where you are if your calculation suggests that someone in Atlanta is better off….

    My personal opinion is that taxes shouldn’t be adjusted for the cost of living, nor should there be any deductions, loopholes or incentives in the tax code. None. It should be a simple and fair system that is easy to explain and enforce and treats everyone equally. This is the only way not to distort the economic eco-system over the long run. As soon as you start putting provisions that cause different treatment of individuals depending on whatever criteria – you make the system less efficient, bubble prone and corrupt.

  33. keepitinflated


    Isn’t that the truth. A tax code that significantly benefitted real estate over any other investment yielded too many houses and condos. How many years have 700 Grove, Maxwell, 800 Jackson, etc been sitting empty? How many permanent jobs are those vacant condos creating? If these vacant places had not been built would there be more homeless? If factory investment was as incetivized as housing perhaps unemployment in NJ would be less than 9%. BTW U6 a broader measure of unemplyment is near 20%

  34. Tiger

    Missed the point, Laki. I am based here and not going anywhere. I was just saying that absolute dollar numbers mean different things for different locations.

    Taxes are already overly complicated and a multi-billion dollar business (HR Block and all), so might as well make them earn their money.

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