Making An Offer on a Hoboken Condo or House
Categories: For Buyers, Hoboken Brownstones, Hoboken Condos
A Different Kind of Gambling
One of the most frequent questions I hear from buyers is “Do you think the seller will accept my offer? Is my offer is good enough?” I often reply with an unorthodox response.
I’ll ask the buyer if he has ever played blackjack and then I present them with a hypothetical scenario. Let’s say you’ve got eleven, the person next to you has eighteen and the dealer is showing a six. According to “the book”, you should double your bet as the next card is most likely to be a ten, your neighbor should stand, and the dealer (assuming his down card is a ten) is most likely to bust. But when you take your next card its a three, your neighbor takes a hit and gets a three and the dealer (whose down card was in fact a ten) also pulls a three. The dealer beats you 19 - 14 and your neighbor wins 21 - 19. You played right and lost; he played wrong and won. That’s just not fair!
No it’s not - but this is not science, it’s gambling. Bidding on a home is a form gambling too. Sellers gamble that the price for which they list their property is right and will attract interest. Buyers gamble that the offer they make is high enough for the seller to accept, or that they won’t get outbid. You can make a very fair offer (maybe even full price) and still get outbid. That’s playing right and losing.
When You Finally Find the Perfect Property
I also like to tell people this very appropriate (and 100% true) story. When my husband and I were house-hunting in Hoboken nine years ago, I called him to say I had found the “perfect” house that had everything we wanted. I urged him to come look at it right away. He agreed that it was an outstanding house and that we should make an offer. Although the house had just come on the market, we knew that there already was an offer on the place, but that it had not yet been accepted, so we assumed it was low. We chatted about how much we should offer and I suggested we offer $10,000 below asking price. My husband said that was very fair, but asked me one simple question:
“If we offer $10,000 below asking, and you don’t get the house, how bad are you going to feel?” My answer was that I would be “devastated.”
Take a Long Range View
There’s your answer. Are you willing to bet the house of your dreams to save $60 a month? That’s right - $10,000 more at 6% on a 30 year fixed mortgage only adds 60 tax-deductible dollars a month to your mortgage payment. Do you think that’s a good wager? Ultimately we made a full price offer, got the house and now, nine years later, couldn’t be happier. If you are considering how much to bid, ask yourself if there are other comparable houses or apartments that you will be equally happy with, or if losing this particular property will crush you. Determining how much to offer will be a much easier decision.
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Learn The Little Known Dangers Of Small Hoboken Condo Buildings
Categories: For Buyers, Hoboken Brownstones, Hoboken Condos
Would You Buy a Condo in A Building With Only 3 Units?
If so, you better keep reading. Hoboken has very few co-ops. Most units in Hoboken are condos. A condo building is run by the condo association. The condo association is made up of the unit owners. Each unit owner has a vote. Sometimes, that vote is proportional in relation to the size of the unit owned. Other times, it is 1 vote per unit. So what’s the problem with that, you ask?
Hoboken has many older 3 and 4 story homes that have been converted into 3 and 4 unit condos. Let’s say you’re about to purchase a unit in one of these 3 unit buildings. You would own 24% of the total square footage of the building, your upstairs neighbor owns 24% and the family downstairs in the duplex has 52% of the total. So your vote is worth 24%, the upstairs vote is worth 24% and guess who controls the building? Or the same owner owns two floors and now the third floor unit is for sale. Each condo unit gets one vote. Again, your soon to be neighbor makes all the decisions.
Why Should You Care?
Living in a condo building requires cooperation among unit owners. It also requires decisions to be made that effect everyone. Think about who decides how much the reserve fund should be, whether special assessments will be imposed or whether maintenance fees ought to be increased, and if pets are allowed. When one unit owner has a controlling interest, all these decisions can be made by that owner. What if you prefer to live in a well maintained, clean building but your neighbor could care less? If they decide how the condo fees are spent they may not be willing to repair the roof, paint the common areas, clean the hallways or install new lightings. Owning property requires maintenance and upkeep. Improving property costs money. If you’re not on the same page as the neighbor with the controlling vote, you have no recourse except to make improvements and repairs at your own expense. Or you may have a really difficult time selling when your building looks like a money pit.
Even Under The Best Circumstances, How Big Is Your Safety Net?
If you and your neighbors all get along famously and agree on exactly how your condo should be kept and financed there is one more thing to consider. When you purchase in a condo building with 10 or more units, not only is the governance of the condo association likely to be more of a democratic and participatory process but there are more unit owners chipping in to handle maintenance costs and repairs when needed. Many small Hoboken condo buildings have very meager reserve funds. Often, they are no more than a few thousand dollars. Smaller buildings are more commonly self managed. They tend not to have regular meetings, don’t keep minutes, and sometimes have no budget. Of course, these are all items your attorney should be checking into during attorney review. Unfortunately, it is often overlooked.
How to Protect Yourself
Are all small Hoboken condo buildings to be avoided? No - some of them are fine. They have attentive owners who run the association properly or pay a management company to do much of the work. There are condos in Hoboken with smart unit owners who have established adequate reserves and prepared a realistic budget. The voting rights in some small Hoboken condo buildings are allocated 1 vote per unit specifically so that no one unit owner controls everything. This is set out in the condo documents - the certificate of incorporation and the bylaws. The important lesson is that you ask the right questions before deciding to make an offer on a condo unit in a small building. Know what you’re getting into before you buy.
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The Weekly Wednesday Wrap-Up - Hoboken Condo and Home Sales Activity
Categories: Hoboken Brownstones, Hoboken Condos, Weekly Wednesday Wrap Up
Hoboken Real Estate - As Of Wednesday, March 12th:
Studio & One Bedroom Condos:
Total Active: 148 Under Contract (Dabo’d): 60
Sold (Deals Closed) This Week: 8 Average Sold Price: $436,873
New Listings This Week: 24
Two Bedroom Condos:
Total Active: 249 Under Contract:98
Sold: 5 Average Sold Price: $664,200
New Listings:60
Three Bedroom Condos or Bigger
Total Active: 44 Under Contract:10
Sold: 0
New Listings:2
One Family Houses
Total Active: 10 Under Contract:2
Sold:1 Average Price: $800,000
New Listings:2
2 - 4 Family Houses
Total Active: 14 Under Contract: 11
Sold: 0
New Listings: 0
Remember - these figures represent only properties listed and sold on the Hudson County multiple listing service. They do NOT include new construction sold directly by developers such as Toll Brothers.
Compare to last weeks activity and inventory. Compare to two weeks ago. Compare to Feb. 27th. Compare to Feb. 20th. Compare to Feb. 13th.
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The Weekly Wednesday Wrap-Up of Hoboken Condos and Homes Sales Activity
Categories: For Buyers, For Sellers, Hoboken Brownstones, Hoboken Condos, Weekly Wednesday Wrap Up
Hoboken Real Estate - As Of Wednesday, February 27th:
Studio & One Bedroom Condos:
Total Active: 135 Under Contract (Dabo’d): 60
Sold (Deals Closed) This Week: 4 Average Sold Price: $331,250
New Listings This Week: 14
Two Bedroom Condos:
Total Active: 224 Under Contract: 95
Sold: 11 Average Sold Price: $675,363
New Listings: 18
Three Bedroom Condos or Bigger
Total Active: 38 Under Contract: 11 Sold: 0
New Listings: 0
One Family Houses
Total Active: 8 Under Contract: 4
Sold: 1 Sold Price: $1,075,000
New Listings: 1
2 - 4 Family Houses
Total Active: 19 Under Contract: 7
Sold: 1 Sold Price: $935,000
New Listings: 1
Remember - these figures represent only properties listed and sold on the Hudson County multiple listing service. They do NOT include new construction sold directly by developers such as Toll Brothers.
Compare to last weeks activity and inventory.
Compare to the week before.
Compare to week of Feb. 13th.
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The Weekly Wednesday Wrap Up - Hoboken Property Inventory & Activity
Categories: For Buyers, For Sellers, Hoboken Brownstones, Hoboken Condos, Weekly Wednesday Wrap Up
Hoboken Real Estate as of Wednesday, February 20th
Each week, I’ve been providing you with the statistics on the number of condos active and under contract as of today. In addition, I’ve told you the number of new listings and sales that took place from last Wednesday through last night. This week, I’m adding the average sale price for the closed deals. All of these are presented by unit size. Let me know what you think.
Hoboken Studio and One Bedroom Condos:
Active 127 Under Contract 58 Closed 1 Avg. Sold Price $490,000 New Listings 5
Hoboken Two Bedroom Condos:
Active 225 Under Contract 100 Closed 4 Avg. Sold Price $549,125 New 15
Hoboken Three Bedroom and Larger Condos:
Active 41 Under Contract 11 Closed 2 Avg. Sold Price $612,500 New 5
Hoboken 1 Family Homes:
Active 8 Under Contract 4 Closed 0 New 2
Hoboken 2 to 4 Family Homes:
Active 20 Under Contract 8 Closed 0 New 2
PS - the above view is Hoboken from the roof deck of Harborside Lofts. Worth a million bucks, no?
Compare to week of February 13th.
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