Sea Isle City Reflections

The annual Polar Bear Plunge in Sea Isle City, which will be held on Presidents weekend will be exiting and exhilerating for all that participate. Whether you take the plunge, or are one of the hundreds of cheering spectators, this year could be the one of the warmest in recent history. If the weather continues as it has, you will see many more than usual dive into the salty water at JFK Boulevard and the beach.

If you are trying to locate accommodations for this weekend, I recommend trying one of the local hotels which are open for this event.

The Sea Isle City NJ Rentals for 2007 is well on its way to be a bannar year. Inquiries have been strong since Thanksgiving. The warm weather has had an effect on renters coming down to Sea Isle. Many come down in the off-season to rent their property, and enjoy the rest of the day at the Jersey shore.

Whether you are renting on line, or taking a weekend drive to the unusually warmer winter weather to choose your property, you may want to book your dream vacation home soon. The inventory is limited and every day some are taken off the market.

Overall, 2006 was a very slow year with property values coming down and leveling off. Most buyers waited to see what was going to happen and how low the prices would come down.

We had a huge inventory of new construction because purchases and permits for the new construction occurred in the fall of 2005 before the slow down started. This lead to a large number of new construction properties being completed in the spring and summer of 2006, and not too many buyers. Owners waited, and eventually lowered the prices until they started to sell. November and December of 2006 started showing an increase of interest in these properties. Our office had a good December compared to the rest of the year. It seems that buyers are starting to purchase again.

My advise to anyone who is still interested in owning a property at the Jersey shore is to start looking now. We are only one week into January and the calls for properties are starting to come in. The news media is suggesting that the 18-month market correction that followed the four-year housing boom has just about run its course. Interest rates are still very reasonable, (about 6%), which makes the conditions very good to buy a property at the shore. I am personally looking for another investment property because I believe this is the right time to do so, before everything starts taking off again. 2007 looks to be a good year for Real Estate at the Jersey Shore.

The Renault Winery, which is only a short drive from Cape May and Atlantic Counties offers a variety of wine tasting tours, golfing, romantic getaway packages at their hotel, and some fine dinning experiences. I recently visited Renault Winery and had a fine dinner. If you are visiting the casino’s and don’t want to be in the hustle and bustle of Atlantic City, check out Renaul Winery as an alternative. You will be glad you did.

My wife and I recently had dinner at the Deauville Inn in Strathmere. They are offering Two for One Dinners on Monday and Thursday evenings. We had a great meal for the price. I would recommend everyone taking advantage of this special that the Deauville has to offer.

I recently read an article on the real estate market that explains the circumstances behind the slow down in sales and encourages buyers and sellers to work with the market you are currently in and not look at what the market was months or years ago. I think thiere is much truth in this and I hope you enjoy reading it. If you have any comments, please send them to me.

M. Anthony Carr
9/16/06

When it comes to pricing your house when you’re ready to sell it, keep in mind you must sell in the market you’re in today. It doesn’t matter what your former neighbor got six months ago, or what properties are listed for now. All that matters is this-whatever the last sale price in your neighborhood of your model, that’s probably your sale price now. When you’re looking at what you’ll gain on the sale of your house, let’s keep it in perspective. If house prices increased year after year at four percent per year and then suddenly people were selling their houses for one percent less than last year’s asking price, would that be reasonable? If so, then when property is moving up at twenty percent per year for several years and then suddenly you have to sell it for five percent less than the prices last year, would that be reasonable? The challenge is when we move from percentages to dollar amounts. If five percent represented $5000.00, most people wouldn’t blink. It’s when five percent represents $25,000.00 that sellers start to freak. We are experiencing astounding rates of appreciation as a region, twenty percent from 2004 to 2005 prices. Many homeowners have experienced a doubling in property values over the last five years. The average home price is now about $540,000.00, according to the local multiple listing system. Now, price appreciation has subsided and is sitting at a mere five to eight percent region wide. Still sounds pretty healthy, right? You would think. However, there are stories from the field on how sellers are defending their prices as if their lives depended on it. While sellers are sitting on hundreds of thousands of dollars of equity, they can’t stand the idea of dropping their prices by $25,000.00 or $50,000.00 to sell it today. The house that was $260,000.00 in 2001, is now selling for $569,000.00 today. But some sellers now want that same type appreciation and can’t imagine selling it for less than $589,000.00. Bringing it down the $20,000.00 or $40,000.00 to sell the property seems, well, just not fair. Sellers seem to be saying to buyers, “I’ll drop my price, just make an offer.” While buyers are replying, “I’ll make an offer, just lower your price.” It’s this stalemate that has played a part in creating an abundant supply of houses on the market in our area. We’re talking upwards to 200 percent more homes on the market in any given year-to-year comparison. Is it affecting prices? Sure. Are sellers going to lose money? Well, in some cases, but not in most cases. For sellers staying in the same area, keep in mind, if you have to drop your price by five percent, then the seller of the house you’re buying (usually a lot more expensive) is probably going to drop the sales price by about the same percentage point. It means that while you may “loose” money on the sale of your home, you’ll more than likely “gain”it on the purchase up. Keep in mind, the market is the market. When it is time to buy, buy. When it is time to move, then sell. Work with the market you’re in, not in the market you wish it would be.

I recently found an article in the paper dated November 9, 2006, and I thought the property owners of Sea Isle City would enjoy reading it:

SEA ISLE CITY: Voters passed a change of government referendum Tuesday that will set the stage for a major nonpartisan election in the spring. Next year, residents will elect officials to fill five council seats and a mayor’s seat, following the referendum that doubled the size of elected local government. The public vote passed 767 to 659 on Election Day and produced a nearly 70 percent turnout. Debate on the referendum brought sharp opinions from both sides. “In the spring, I hope that a number of people express an interest in participating in the government, so we have an election with a variety of people, old and new- whoever wants to do something,” said John Fee, one of the leaders of the referendum drive. The large turnout, Fee said, was a key in lending the change of government validity. “ I think the volume of turnout was important. Nobody can turn around and say only a fraction of the people spoke. It was a very healthy turnout,” he said. The new government will include five at-large council members and a popularly elected mayor. The City Commission is currently composed of three members, including a mayor appointed from its own ranks. “The commissioners are there to serve the people, and this is what the people want, and this is the way we’re going to go,” Commissioner Angela Dalrymple said. Mayor Leonard Desiderio said both sides of the issue waged good campaigns and worked hard to get their points across. “People were voting before they went to work, before they were going to vacation, before they were going wherever they were going. I was happy to see that,” Desiderio said. Desiderio, also a Cape May County freeholder, won re-election to that office Tuesday. Desiderio said if he decides to run in the spring, he would run for the mayor’s seat. “I love being mayor of Sea Isle City and whatever form of government would be there,” he said. “I would run for the mayor’s seat, but I’m going to weigh all my options. I’ve had discussions with people early this morning for an Assembly seat. And I’m like, whoa, let me digest this election first,” he said. Commissioner James Iannone said he will not seek re-election next year as he approaches his retirement and has served city government for more than two decades. Iannone did not support the change in government and had said it was sour grapes from the people upset with last year’s election, when all three incumbent candidates won re-election. But he said he will work to make the new form of government a success. “I don’t think six people can do a better job than three. However, I’m not one to moan and groan after the election just because we lost it. I will support the new form of government,” he said. Dalrymple on Wednesday said she couldn’t say if she will seek election next year.

SEA ISLE VOTERS SAY “YES”

To a surprise of most, the Sea Isle City voters said, “Yes” to the larger city government. This will allow for a City Administrator, and two more councilmen. For all of you who were wondering, the answer is “Yes”.

This is something that was discussed in our office the other day. My broker had a discussion with his financial advisor about the Real Estate and Stock Market

His financial advisor made an interesting comment to him. He said: “Buying stocks are just like buying real estate. For some reason, everyone wants to buy their shoes on sale, but nobody wants to buy a stock – or real estate- when it’s on sale!”

I also find this to be true.

Real estate has appreciated on average 17% per year over the past 25
years in Sea Isle City. The market saw a downturn in 1991-1992, and now
again in 2005-2006. It seems to me that properties are on sale right now.

Interest rates are down again – 30 year fixed rate is about 6.5% with 0
points.

If you are interested in purchasing a property at the Shore, and hadn’t
done so prior to 2001; NOW is the time to buy. I believe the next six
months (prior to the Spring season) will be the best time to purchase a property.

Don’t wait for EVERYBODY to get back in the market because once this starts to happen, prices will start to rise, and the opportunity to buy a property on sale will be gone.

Let me help you be a part of the group who will talk about the great opportunity you saw when real estate properties were on sale at the Jersey Shore.

I look forward to hearing from you.

Sincerely,

Joe Prato

As many of you are aware, the real estate market in Sea Isle City, along with almost every other area, has leveled out over the past several months. By doing so, this leaves a great opportunity for buyers to take advantage of the market at the shore. With low interest rates, reduced prices and motivated sellers, opportunity knocks.

If you have missed the opportunities the shore has had to offer in the past, don’t miss out again. As an investor, I’ve just put in an offer on an investment property in Sea Isle myself. The conditions are great for buyers.