The Jersey Shore Market After Hurricane Sandy

By
Real Estate Agent with Berkshire Hathaway HomeServices, Zack Shore REALTORS
We had a client email us asking about changes in the market due to Hurricane Sandy & his accountant's opinion on the changes in the market value........ here is my reply:
 
 
I have seen no examples of major price changes in the market as of yet, except a few storm damaged properties are now on the market in "as is" condition. These properties have been placed on the market for the seller's perceived
value of the land and it appears they may be over priced for the conditions and terms.
 
After Hurricanes Fran (1996) & Floyd (1999) North Carolina saw only an average 7.5% drop (and only temporarily) in prices. Your accountant's estimate of almost 20% seems excessive considering those areas affected by Sandy are more affluent and more people here have flood insurance than in North Carolina. Sales have not closed to prove mine nor your accountant's position but the current market condition and the economy closely matches the late 90's.

It is my opinion and that of several professionals in the area, that prices will remain close to the same, with a minimal drop but the numbers of sale will slow significantly (like 2007) and in the long run prices will quickly increase in about 18 months. This opinion also reflects the history of what happens after most storms of this nature, after the rebuilding commences. The houses in the affected areas will be better with newer, flooring, appliances, etc and homes damaged beyond 50% of their value will be rebuilt to current code.

Now is very much the time to jump on the market here as history shows prices have in the past jumped considerably about 2 years after an incident like Sandy. Call The Murphy-Lee Team today @ 800-594-3315 with your questions or better yet to schedule to see some of the deals here at the Jersey Shore.
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Re-Blogged 3 times:

Re-Blogged By Re-Blogged At
  1. Keith Ritter 11/26/2012 07:02 AM
  2. Donna Derrick Ponte Vedra Beach, Jax Beach FL 11/26/2012 10:18 PM
  3. Ginger Harper 11/27/2012 05:48 AM
Location:
New Jersey Ocean County Manahawkin Beach Haven West
Tags:
jersey shore
long beach island
manahawkin
beach haven west
the murphylee team
hurricane sandy
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Rainmaker
60,058
Eileen Murphy, Curtis Lee "The Murphy-Lee Group"
Berkshire Hathaway HomeServices, Zack Shore REALTORS - Manahawkin, NJ

Thanks everyone!!

Laura, We'll see, I think we may actually do a little better next year due to the limited inventory, time will tell.

Masline, Coastal No. Carolina is a similar market to here, it's an assumption on my part based on there being almost twice as many policies in effect in NJ as NC, as seen here on the FEMA website http://bsa.nfipstat.fema.gov/reports/1011.htm

Ocean & Monmouth Counties have been in the top 10 of new construction markets for many years, due to the down turn southern Ocean has seen less construction jobs. New construction was one of the driving forces here, many people inland work (or worked) in the industry thought out a large portion of NJ. This unfortunate event's only good point is increased jobs & that will not only repair the damaged parts of the shore but bring much needs work to those inland helping to revitalize those communities too.

Nov 27, 2012 12:44 AM #26
Anonymous
Tim C.

As long as the new buyers realize that after Sandy,that no doubt the NEW insurance rates will no doubt be astronomical. I can't imagine having a house rebuilt even with their current insurance and having to pay the new,higher rates without second guessing their decision to be there.

Nov 27, 2012 12:48 AM #27
Rainer
37,141
Jayson Holland
Listings.com - Denver, CO
Jay Holland

Although I am now a Realtor in Denver, my home town is Point Pleasant Beach, NJ. I was born there, my family is there. My cousin is with REMAX in PPB, and his sister was actually the acting mayor during Sandy.

Reading the headline of this post and most of the comments reminds me why I stopped "raining".

 

"NOW IS THE TIME"?

Who ARE you people?

There are still vast areas around Point Pleasant Beach with no utility service. There is a monumental amount of repairing and rebuilding to be done. The cleanup is still on-going and will take MONTHS. You can't even go into the town of Bay Head yet without resident ID, let alone further down the barrier island, at all.

I know, because my cousin was driving food donations into Bay Head yesterday and was stopped by the National Guard at each "border crossing". There is a state of martial law. Property owners are not permitted access to the property that they own. Entire neighborhoods do not have electricity, water, gas, heat. Do you not understand that?

 

But "now is the time" to "jump on the market"??? Are you all kidding???

I can imagine this phone call......

buyer: "Hello, I would like to jump on the New Jersey coastal real estate market please,"

agent: "That's great we can set up an appointment for you to see some houses..... in April 2013!"

THINK!

Furthermore, FEMA is supposed to be redrawing the flood maps to be completed some time in 2013 based on a storm surge height never seen before. I wouldn't want to buy anything anywhere near any body of water in NJ until I saw those new flood maps, and a good fiduciary would advise their client to do the same. It's quite possible that no one will even be able to buy property near water with a mortgage until those new flood maps and corresponding new flood insurance rates are determined. If you were a bank, would you lend yet?

Let's try to use just a little common sense here people, if possible.

I've said it before, and I'm sure I'll say it many times again ~ the bar is set so low in our industry you can barely trip over it.

Thank you all for proving it!

 

Nov 27, 2012 01:17 AM #28
Rainmaker
808,062
Bob Miller
Keller Williams Cornerstone Realty - Ocala, FL
The Ocala Dream Team
Hi Eileen we agree and that is what we see in Florida after a storm. Then market rebounds stimulated by all the repairs and construction.
Nov 27, 2012 01:53 AM #29
Rainmaker
1,432,724
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
Your real estate writer

There's always someone playing "Chicken Little," no matter what happens.

Considering how many homes were damaged, I've been wondering if the insurance adjustors have gotten caught up yet, so reconstruction and repairs can begin.

Nov 27, 2012 02:30 AM #30
Anonymous
Realtaholic

Here is something else that we see in Florida and that Realtors in NJ will see as well...sharks who smell blood in the water. I mean LAND SHARKS.  They assume owners (and Realtors) will be desperate, so they make ridiculous offers.  Some of those guys (not all) are the type of buyer for whom getting a great deal isn't enough -- they want the other party in the transaction to suffer.  

 

For instance, after the Florida Real Estate Bubble Burst, we had people who wouldn't buy a $500,000 bargain on the water unless the owner had paid at least twice that. If it was a bargain at $500,000 but it was owned free & clear (not upside down) or it was brand new with no previous owner, they weren't interested.

 

Sick, right?

 

Nov 27, 2012 02:38 AM #31
Rainer
225,294
Dave Sullivan
Real Estate One - Birmingham, MI
Michigan Realtor with an investor viewpoint

Excellent information I will forward it if that is ok? thank you!!!

Nov 27, 2012 02:45 AM #32
Rainer
286,848
Thomas McCombs
Century 21 HomeStar - Akron, OH

There are some that feel that Realtors should not make predictions about the direction of the market. They feel that this activity is not provided for in either the COE or in license law.

I disagree, and I think that you have provided an excellent analysis. Keep up the good work!

Nov 27, 2012 03:10 AM #33
Rainmaker
60,058
Eileen Murphy, Curtis Lee "The Murphy-Lee Group"
Berkshire Hathaway HomeServices, Zack Shore REALTORS - Manahawkin, NJ

Well Jayson,

I stopped "raining" for awhile myself do to arrogant asses who don't know what they are talking about blasting people. Now I'm not sure if it's the lack of oxygen at your elevation or you are still celebrating your state's vote on marijuana that caused you to rant like a two year old but, try rereading my post. Sorry it took so long to reply to you I was out showing house here AT THE JERSEY SHORE.

The new flood maps that FEMA are doing are just a bit more accurate and most of the properties in question were already inside the flood plane as proved by the flooding. People buying by the water are or should be aware that flooding is a possibility.I know of no banks not lending based on the proposed map changes, some are cautious at this time but none based on the proposed map change.

Point Pleasant isn't the entire Jersey Shore plenty of other towns were not as severely damaged as proven by the waterfront and beach homes going under contract every day here, we even closed island homes the day after the storm in my office. This is why we work with an agent who knows the local market not one 1/2 a country away.

Now I don't like the call to action "now is a good time to buy" but I feel it is a good time based on the following:
1) You can see how the property fared in the storm as repairs haven't been made yet.
2) Decreased competion as most buyers have gone to a wait an see position.
3) Based on what I found about what typically follows a storm of this nature in the past, prices may very well be much higher in the not to far off future.

But thanks for you "helpful" contributions to the conversation & proving your bar set so low comment with your unprofessional tirade.

Nov 27, 2012 05:23 AM #34
Rainer
292,358
George P. Cruz Sr.
DR Horton - Port St Lucie, FL
PSL FL CDPE, TRC, CIPS

Great observation..

 

 

 

 

 

 

 

 

Nov 27, 2012 05:44 AM #35
Rainmaker
894,174
Ginger Harper
Coldwell Banker Sea Coast Advantage - Southport, NC
Your Southport~Oak Island Agent~Brunswick County!

You have the right attitude.. You all have had your hands full. Know that you have been in our thoughts and prayers. Yes..."Keep Calm and Stay Jersey Strong". Great words for us all to keep in mind..

Nov 27, 2012 05:49 AM #36
Rainer
8,430
Jennie Blackburn
Blackburn Investors Realty - Redington Shores, FL
Beach & Waterfront Realtor

Good for you, Curtis & Eileen!

Nov 27, 2012 06:15 AM #37
Rainmaker
93,409
RE/MAX BEACH HOME REALTY
RE/MAX BEACH HOME REALTY - Sea Isle City, NJ
Geraldine Rescigno ABR CRS, e-PRO, RSPS, SRS

We were lucky to not have had too much damage to the homes in Sea Isle City. NJ.   I am currently cleaning out my office as the flooding under the crawl space went into the beams and caused "speed bumps" in the flooring.  The carpet and floor boards have to be replaced.  All in all, it could have been much worse.  I think we didn't get it as bad as other shore towns because the "eye of the storm" came over us.

As far as the market goes, we still have inventory but I have found some buyers don't want to "inconvenience" any sellers that may be cleaning up.  I am telling them that the homes that were hit the worst have been taken off of  the market.  Although some stores may still be closed, the majority of town is open and ready for visitors.  If you are in the area, stop by my office at 4200 Landis Avenue!

Nov 27, 2012 08:19 AM #38
Rainmaker
60,058
Eileen Murphy, Curtis Lee "The Murphy-Lee Group"
Berkshire Hathaway HomeServices, Zack Shore REALTORS - Manahawkin, NJ

Gerri,

Glad you are making progress and your damages were not to bad.

Our firm did rather well with 9 offices from the Raritan Bay to the Mullica River, only one is currently not up and running. Our Point Pleasant Beach office was flooded and will take awhile to get back up to speed.

The point of my post was all real estate is local and anyone making wild claims of crazy devaluation of all Jersey Shore properties is over reacting and there is no proof it will happen based on past performance in other similar markets.

Thanks for the offer & should you find yourself near LBI feel free to drop by.

Nov 27, 2012 08:44 AM #39
Rainmaker
1,430,924
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

Sounds like an accounting winging it with a guesstimate (probably ran a Zestimate lol!).  They have the same credibility which is zero.  I might think that the opposite might happen, with housing being scarce right now might make prices increase.  At least for rentals for sure & any type of temporary housing situation.

I wish all there in NJ luck & patience during this time!

Nov 27, 2012 08:54 AM #40
Rainmaker
458,690
Mary Hutchison, SRES, ABR
Better Homes and Gardens Real Estate-Kansas City Homes - Kansas City, MO
Experience Agent in Kansas City Metro area

My only comment is : it was heartbreaking to see the aerial shots of the Jersey Shore.  I have never visited the area but hearing the stories of kids growing up there, family vacations, etc--very sad.  It seems like it was a place of mostly mom&pop type shops and motels, not many national chains...I do hope those small businesses can rebuild.

Nov 27, 2012 09:46 AM #41
Rainer
208,419
Rafi Footerman
Mid Jersey Inspections - Edison, NJ
Home Inspector, Mold Inspector, Radon and More!

Glad to hear you're up and running.  I hope to perform many inspections down the shore next year (especially in the summer).

Nov 27, 2012 10:38 AM #42
Rainer
133,027
Rob Renk
Center Street Lending - McKinney, TX
AE | Fast Fix/Flip Loans for Residential Investors

good to hear that things are near normal in your area.  Best of luck.

Nov 27, 2012 11:05 PM #43
Rainer
452,194
Kimo Jarrett
WikiWiki Realty - Huntington Beach, CA
Pro Lifestyle Solutions

I thought your response to Jayson, #28 was insightful and dignified. Everybody is entitled to their opinion, however, challenging your facts from about two thousand miles away doesn't make any sense, doesn't it? It certainly proves your point that selecting a local Realtor from the area you want to reside is always a better and prudent decision than getting advice from somebody or RE agent from outside that area. 

Nov 28, 2012 02:07 PM #44
Rainer
295,171
Paddy Deighan JD PhD
TimeshareLawyers.pro - Vail, CO
Paddy Deighan J.D. Ph.D

I have had several short sales disrupted and I know that the rental market is going crazy because there are many displaced home owners...

Dec 09, 2012 01:59 AM #45
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Rainmaker
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Eileen Murphy, Curtis Lee "The Murphy-Lee Group"

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