Buying A Shore Property ... in Ocean City, New Jersey
(The second of a series of blog postings reguarding "the best time to buy a shore property.)
A Short History
Reflecting back in my 19 year career in real estate, after my 32-year career in public education; it means reviewing the time frame from 1993 through 2011. The mid-to-late 1990s were a time of a slowly emerging market here in Ocean City (NJ) that had taken off a bit earlier with the growth of casino gambling in Atlantic City.
But during the 2000 through 2005 time frame, it was a wonder of growth ... sales, purchases, sales, and purchases again. I recall the one aspect of that: one could buy a condo in the spring, rent it out for the summer, and sell it in the fall making a quick $100,000 during that time frame. Looking at the single family market, which was the one I spent time in on a personal level, I bought a 1920s cottage in 1988, a 1940s house in 2001, and a 1930s house in 2002 (selling as I went along). I made money on each purchase/sale, but in 2005 when we made a decision to build/renovate; the land value of the 1940s house was $500,000 above the purchase price of the property after about 3 years.
Keep in mind the differences in the three major property categories: single family, multi-family, and condominium. The single family category tended to attract second home buyers, retirement people, and those moving into the community full-time which made this category a much more stable one than the other two. With the growth of so many condominiums and the condition of the multi-unit properties, they became builder and developer choices for teardown with the result two new condominiums on the same property replacing the multi-unit that had been there. Those multi-units in better condition and those with smaller lot sizes or further back from the beach were less likely to be torn down ... but the actual number of remaining mutli-unit properties for sale each year is a small part of the total sale inventory. And obviously, the growth and number of condominiums continued to increase during this time frame. The condo became the purchase of choice, the normal "first buy" for most buyers, and the stepping stone for any future purchase here in Ocean City (NJ).
2005 was the last big year in the growth surge here ... I recall selling properties from February June where I thought I was going to have my best year out of all these "best years in the 2000-2005 range, but the second half of 2005 was a significant flop for me. Regardless of what happened all year long ... it was the beginning of the slow down. dap
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