Dear Two Bedroom Buyers,
I’ve got to tell you – the days of getting a nice place with parking and a washer/dryer in the low $500,00s is so over. Get ready to pay the big bucks. There is no end in sight.
There is simply no inventory in Hoboken. There are multiple bids on almost every decent property. I called about a multi-family investment property just outside of Hoboken today and there were 23 offers. Yes, 23. This is not likely to change any time soon. I say that not as a cheerleader for the local market (I’m not selling) but as your real estate consultant. It’s a fact that is derived from the reality of prices in our surrounding neighborhoods. One bedrooms in Manhattan sell for a million or more. Families are moving to Bed-Stuy where new prices are being set. Hoboken is still a safer, MUCH more convenient, lower-priced option than many other neighborhoods.
There has been an interesting discussion in the comments of an earlier post about whether or not Hoboken families will stay in Hoboken or, due to our less-than-stellar schools, will flee to the ‘burbs. Dr. Scott Cowen was the President of Tulane University for the past 16 years. He is originally from New Jersey. For a really great, in-depth discussion of why schools are bad, the link between failing schools and poverty, how charter schools change the outlook, and what can be done to make public schools better, I highly recommend you read The Inevitable City: The Resurgence of New Orleans and the Future of Urban America, which was just published and written by Dr. Cowen. Aside from my own personal interest in New Orleans, I found many parallels between the problems there and those we face here in Hoboken. There are valuable lessons to be learned and this book is full of them.
I firmly believe that the future of Hoboken will be inextricably tied to the strength or failure of the Hoboken school system. What direction Hoboken takes from here will be greatly influenced by residents participating and having a stake in the future of the community. I believe that homeowners have a much greater interest in local affairs. It has been said that homeowners are more likely to vote in elections than tenants. One must ask, what effect will the addition of hundreds of new rental units popping up in Hoboken have on the future of Hoboken? How will this shape the future of the Hoboken Housing Authority buildings, or “the projects” as they are more commonly known. (Another fascinating subject of Dr. Cowen’s book is what happened to the projects in New Orleans after Katrina). What will the future of the projects mean for Hoboken’s schools? These are important questions and the answers to them will directly affect Hoboken property values.
Here are the July numbers:
Look at the 2 bedroom average sales price – it has reached over $700,000 for the first time ever. The number of active units on the market is way down from a year ago – a 42% decline. Similarly, the absorption rate, or how long it would take to sell current inventory at today’s pace of sales, is also down. That right there is the story. High demand, low supply, rising prices.