2012 Jan 30th

What’s Really Happening in Hoboken Real Estate? Absorption Rate Tells All

We have a bunch of year end statistics I’ve been periodically posting.  There is one, however, with which I have real-life, day-to-day experience.  I work with a lot of buyers.  More than almost any other agent in Hoboken.  The problem I’ve seen at every price point and every bedroom size is this – there is simply no inventory out there.  My buyers request to see a particular unit, I make the call for the appointment and find out it’s already under contract.  They make offers only to learn that there are 2 and 3 other offers on the same property.  It is happening more and more frequently.  The chart below will help to explain why:

Basically, we don’t have enough inventory.  Let me break it down a bit further.  Other than the seasonal 4th quarter “holiday respite” the number of properties being listed has dropped steadily.  Take a look:

Not many listings at all.  We’ve gone from a high of  513 new listings in the 1st quarter of 2010 to a low of 153 new listings this past quarter.  That is a huge, 70% decrease.  Why, you might wonder?  Well, those people who bought at the last market peak (yes, I do believe eventually there will be another) aren’t selling at a loss.  They are either staying put or renting out their properties.  So we don’t have many units for sale.

And what has happened to sales activity during that same time frame?

There has been a drop recently but not nearly as great.  The high was 284 units sold in the 4th quarter of 09 and the low 139 units last quarter.  That is a 50% decrease.    Going back to the first chart of absorption rate, if listings and sales continue at this pace, it would take only 4 months to sell all the inventory currently on the market.  What that doesn’t take into account is that some of those units are real duds.  They are never going to sell either because they are drastically overpriced or they are in terrible condition.

Which brings me back to my work with my buyers.  I simply have nothing nice to show them.  So I show them the duds with the hope that when a really good property does hit the market, they will feel confident enough to be able to make a strong offer before the other buyers out there do.

Posted by Lori Turoff | Currently 10 Comments »

2008 Aug 19th

Hoboken Condo vs. Downtown Jersey City Condo Absorption Rate

Absorption Rate For Hoboken & JC Condos

Absorption rate means how long it would take the real estate market to absorb all the properties for sale if they were to keep selling at the same rate as they have been. Hoboken Condos Soaked Up By Buyers

Hoboken Condos

Number of Hoboken condos for sale today: 460

Number of Hoboken condos sold since January 1, 2008: 527

Daily rate of condo sales: 2.34222

Monthly rate of condo sales: 71

Months it would take to sell all the Hoboken condos: 6 1/2 months

 

Downtown Jersey City Condos

Number of JC condos for sale today: 357

Number of JC condos sold since January 1, 2008: 278

Daily rate of condo sales: 1.23555

Monthly rate of condo sales: 38

Months it would take to sell all the Hoboken condos: 9 1/3 months

 

Who Cares?

If you’re thinking of selling your condo in the next 6 months, you should care! If your condo is in Hoboken, you are in pretty good shape. At the current absorption rate, almost all the condos on the market will sell in that time period so the chances are your condo will sell, too. If, however, it’s in downtown JC, about two thirds of the condos will sell and a third won’t. Your chances of selling in 6 months are not as good as in Hoboken.

Value of good marketing in Jersey City (and Hoboken): Priceless

 

See also:

 

Posted by Lori Turoff | Currently 1 Comment »

2008 Feb 14th

Jersey City vs. Hoboken Condos – The Absorption Rate Battle

Absorption Rate of Condo Sales

A quick and dirty way to understand what’s going on in any given real estate market is to look at absorption rate. It is essentially a number that tells you how many months it will take to sell out the current inventory on the market (assuming it is calculated on a monthly basis). Absorption rate is especially informative when comparing surrounding areas to each other. For example, Hoboken and Jersey City.

Hoboken Condos:

Looking at the 1 year period from January 31, 2007 through January 31, 2008 there were 650 sales of Hoboken condos on the MLS. Divided by 12 equals about 54.17 sales per month. As of the end of January, there were 321 active condos in Hoboken. So at 54 a month, it would take 5.9 months to sell out.

Downtown Jersey City:

During the same period there were 473 sales of downtown JC condos. That’s about 39.4 per month. At the end of last month there were 303 active properties. So there is about a 7.7 month supply of condo inventory in downtown JC. Again, that does not include any new construction. So it’s 5.9 vs. 7.7. That, together with an understanding of where the most new construction is happening, may help you decide where to put your money if you’re buying and what to expect if you are trying to sell your condo.

Posted by Lori Turoff | Currently No Comments »

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