Kaboom

From StreetEasy:

10 Years After the Financial Crisis, False Optimism Pervades NYC Housing Market

Aspiring investors may be tempted to view the city’s recovery and the gains reaped by a handful of buyers as evidence that only a major bounty comes from owning a home in the city. However, for homebuyers with speculative aims — including foreigners seeking a place to park their money, wealthy shoppers looking for a trophy apartment, and the substantial portion of condo buyers who immediately list their purchases for rent on StreetEasy — the financial wisdom of buying up New York City real estate is much less evident.

Substantial gains in the years after the financial crisis have largely been limited to those who managed to catch the upturn in the market. Those who bought at the top of the last market and have resold in the intervening years have fared less well. Only half of those who bought in the two-year period leading up to the collapse of Lehman Brothers and have since resold earned the 10 percent necessary to offset the costs of buying and selling. Among those buying between September 2006 and September 2008, the median annual return was just 1.7 percent — a dramatic 5.8 percentage points less than those who managed to buy just after the crisis.

Homes bought shortly before the crisis and resold since the crisis were priced similarly to those bought post-crisis: the median resale price for these units was a modest $635,000. Unlike homes bought during the recovery, however, their gains were much lower: roughly $60,000 on the median home resold. This Midtown South studio co-op is typical of homes bought pre-crisis and sold during the recovery. It was purchased for $575,000 in June 2007, and it sold for $635,000 in 2015, a gain of just $60,000, or a 1.3 percent annual return.

Even for those who did manage to time the market well, the numbers are less attractive when compared with other investments. While the 28.5 percent increase in city home prices since November 2011 outpaced the cost of other goods and services, NYC real estate dramatically underperformed the stock market. The S&P 500 more than doubled over the same period, increasing by 125 percent since the housing market bottomed out — an annual return of 13 percent relative to the 3.8 percent offered by NYC real estate. This number also excludes some of the most dramatic gains following the crisis: from its true nadir in early 2009, the market has since returned a whopping 283 percent.

With prices now beginning to fall in both Manhattan and Brooklyn, a cycle of swift growth in New York home prices seems to be coming to an end. A large number of those who bought after the crisis appear eager to cash out: the number of homes for sale on StreetEasy hit its highest level since the recovery in the second quarter of 2018. Of the more than 13,000 homes listed for sale on StreetEasy in that period, more than 35 percent were bought since the September 2008 collapse of Lehman Brothers.

The perception of gains from the recovery seems to have pushed the expectations of current sellers beyond reason. Though overall sales of units bought since the financial crisis have returned a median 33 percent over their previous purchase price — or 7.5 percent per year — sellers listing their homes in the second quarter of 2018 are asking for a 41 percent premium over their previous asking price, making for an average return of 7.6 percent per year. Only 11 percent of the units listed in this period appear to have sold as of late August. Those that did went for returns roughly in line with historical precedent: a 29 percent median total gain, or roughly 5 percent median gain per year. Of those sold, more than half went for below their initial asking price. Only a quarter of those homes sold so far went for 40 percent or more above their purchase price.

These asking prices reflect a belief among sellers that the pace of price appreciation since the crisis is sustainable. However, it appears that price growth in most parts of the city is rapidly running out of steam. According to our July 2018 Market Reports, sale prices in both Manhattan and Brooklyn have begun to tick downward. At the same time, new inventory continues to sit on the market, with another surge in inventory likely to hit the market this fall. Academic research indicates that homeowners are reluctant to set realistic prices when selling in a weakening sales market, a phenomenon that fits well with these market dynamics.

Posted in Housing Bubble, NYC | 6 Comments

The tax on shore rentals nobody knew about

From the Star Ledger:

Summer-rental bill turns homeowners into tax collectors

Former state Sen. Ray Lesniak recalls that when he was a kid his family would head down to Wildwood every summer looking for a vacation rental.

“We’d just knock on doors and find a place a place to rent,” said the Democrat from Elizabeth. “We would just go there blind. Because my dad didn’t like to go out for dinner, we needed an efficiency.”

They always found one, he said.

That might be a bit tougher for similar families next summer thanks to a bill that was passed in the hectic final hours of the budget negotiations in July.

During the debate over which new taxes to include, Senate President Steve Sweeney had proposed that the state impose new taxes on summer rentals.

Gov. Phil Murphy wanted an increase in the so-called “millionaire’s tax” instead.

Eventually they compromised on a bill that would impose a tax only on rentals that go through such online services as AirBnB. That’s what the newspapers reported at the time anyway.

“A tax on shore rentals, floated by Senate President Steve Sweeney last week, was not part of the budget deal, much to the relief of officials and second-home owners in Atlantic and Cape May counties,” said the Press of Atlantic City.

The reason those Shore residents were relieved was obvious. Such a tax would not only increase the cost of summer rentals by almost 12 percent; it would also create a paperwork nightmare for homeowners.

That nightmare begins Oct. 1, despite the deal the newspapers reported. Or so says the Treasury Department.

On Aug. 14 the department sent out an advisory stating that the tax applies not just to internet rentals, but also to “rentals that are made directly by the homeowner.”

As of Oct. 1, those lucky homeowners will have to start collecting state sales tax of 6.625 percent as well as a “state occupancy fee” of 5 percent.

They also have to register with the state Division of Revenue and Enterprise Services and maintain four years’ worth of records on the rentals.

There’s one exception: real estate agents. Somehow their lobby got the bill’s sponsors to exempt them from any tax.

Posted in Politics, Property Taxes, Shore Real Estate | 67 Comments

Everything is holding housing back

From MarketWatch:

This is why Americans are losing confidence in the housing market

Today, less people are buying houses. According to Fannie Mae, a mere 24% of Americans feel like now is a good time to buy a house. Looking back to 2013, when 54% of consumers were confident in the housing market, it feels like a lot has changed in a small amount of time. It’s clear that the certainty of prospective homeowner is waning.

Houses are getting more expensive — period. A recent Zillow report found that the median home value is around $1 million in 197 different cities. This year alone saw the addition of 23 more cities to this not-so-exclusive club.

This data is not reflective of metropolitan areas alone, and, in fact, this trend should concern any prospective homeowner regardless of location. According to a National Realtors Association report, the median price of a single family home is nearly $50,000 more expensive than two years ago.

According to Pew Research, “Today’s real average wage (that is, the wage after accounting for inflation) has about the same purchasing power it did 40 years ago. And what wage gains there have been have mostly flowed to the highest-paid tier of workers.”

The rise in house prices is far outpacing salary growth, and this has serious implications on the financial mobility of American families. In the current market, 1 in 200 people will experience home foreclosure, and anyone who undertakes homeownership without a very reliable income stream runs the risk of becoming one of these statistics.

One of the greatest threats to the housing market is the consumer habits of young people. Millennials have already ruined Applebees and golf, and some experts predict the housing market could be the next victim of emerging consumer trends.

According to Business Insider, millennials are buying homes at a slower-than-usual rate. In the past, 25–34 was the typical age to start shopping for houses, but it seems millennials are lagging behind. Data shows a major deterrent for young people is saving enough money for a down payment.

Financial inhibitors aside, there is a more universal reason millennials aren’t buying houses: young people simply have a different set of values. They are holding off on marriage, having kids older, and moving frequently.

Mortgage interest rates have reached an all time high of 4.66% — an entire percent higher compared with this time last year, and a record high since 2011.

A minor interest rate increase is not worth losing sleep over, but even a little bump can have a huge effect on the cost of homeownership. For example, 3/4 of a percentage point increase in mortgage rates would increase the monthly payment of a $200,000 mortgage by about $85.

As established above, first-time owners are already nervous about plunging into the housing market pool, but high mortgage rates impact another, surprising, demographic: current homeowners.

Homeowners that would normally sell their houses and upgrade to bigger ones are staying put due to high interest rates. It simply doesn’t make financial sense to forfeit a low interest rate for a higher one. High interest rates prevent mobility — someone who might have owned three houses in a lifetime will generally stick to one to avoid unreasonably high interest payments. This is bad for the housing market and even worse for anyone looking to own more than one house in a lifetime.

Posted in Demographics, Economics, Employment, Housing Recovery, Mortgages, National Real Estate | 37 Comments

Long Island prices gain through summer

From LI Patch:

Long Island Home Prices Continue to Soar

Long Island’s housing market continues to grow, as a report released today by the Multiple Listing Service of Long Island showed that housing prices are up and more homes are going up for sale across the Island.

The median home price on Long Island rose 9 percent from August 2017 to August 2018, going from $445,000 to $485,000. There were also nearly 1,000 more homes on the market over last year.

According to Michael Mendicino, the 2018 president of the MLSLI, there is still low inventory in the Long Island market, which leads to higher home prices. “It’s a seller’s market,” he said.

Suffolk County saw the bigger increase, with the median price for home sales there raising 9.2 percent, from $371,000 to $405,000. However, the number of home sales in August decreased year-over-year, dropping 7 percent from 1,885 to 1,751.

Nassau County saw its median price increase, but much more modestly, from $520,000 to $540,000. The number of homes sold in Nassau also dropped, but also much less than in Suffolk. Sales dropped half a percent, from 1,251 to 1,245.

Posted in Economics, Housing Recovery, NYC | 59 Comments

Bye Bye Refi

From HousingWire:

Originations fall to 4-year low due to rising interest rates

The signs were all there. It was clear that mortgage originations were trending down as interest rates rose, but it’s still striking to see the results in black and white.

According to newly released data from ATTOM Data Solutions, mortgage originations plummeted to a four-year low during the second quarter, driven by a sharp decline in refinances due to increasing interest rates.

ATTOM’s Q2 2018 U.S. Residential Property Loan Origination Report, released Thursday morning, shows that there were 1,527,433 residential mortgages originated in Q2 2018, which is down 16% from the first quarter and down 27% from the same time period last year.

The 1.5 million mortgages originated in the second quarter were the fewest in any quarter since the first quarter of 2014.

The bulk of the decline came from refis, providing confirmation of other recent indicators that the industry is in the middle of a significant drop in refi demand.

According to ATTOM’s report, just over 590,000 of the 1.5 million mortgages originated in the second quarter were refis, a drop of 26% from the first quarter of this year and a drop of 27% from the second quarter of 2017.

The cause of the drop? Rising interest rates, as shown in recent reports from Ellie Mae and Impac Mortgage’s most recent earnings information, both of which indicated that a drop in refis was likely industry-wide.

“Rising mortgage rates are cooling mortgage demand across the board, with overall originations down to their lowest level since 2014 — the last time we saw more than six consecutive months with average 30-year fixed mortgage rates above 4%,” Daren Blomquist, senior vice president at ATTOM Data Solutions, noted.

Posted in Economics, Housing Recovery, Mortgages, National Real Estate | 78 Comments

We’re #1! In flipped properties.

From NJ101.5:

Home flipping down, but not in New Jersey

Home “flipping” — buying and selling a dwelling quickly after renovations for a profit — is slowing in most parts of the country. But flipping activity in New Jersey is still going strong.

“Flipping” is selling a home for the second time in 12 months, usually after renovations that enable a quick sale and enhance curb appeal.

Daren Blomquist of real estate activity scorekeeper Attom Data Solutions said home sales data for the second quarter of the year finds 64 percent of the homes flipped in New Jersey were bought in foreclosure — and that is the highest of any state.

In most of the United States during that time, home flipping returns dropped to nearly a four-year low. Outside of the Garden State, Blomquist said, “fewer distressed sales are limiting the ability of home flippers to find deep discounts, even while rising interest rates are shrinking the pool of potential buyers for flipped homes.”

According to Blomquist, the main reason why flipping is alive and well in New Jersey is simple — it is very profitable.

“The home flippers are selling the properties for 73 percent more than they are buying them for.” He adds that the higher number of distressed properties, mortgage foreclosures and the like, in New Jersey is still part of the lingering residual effect of the burst housing bubble and the great recession.

In Atlantic City, better than 7 in 10 homes purchased by distressed sale in the 2nd quarter were flipped. In Trenton, it was better than 6 in 10 homes.

Posted in Demographics, Economics, Foreclosures, New Jersey Real Estate | 64 Comments

NJ economic growth at 18 year high

From Bloomberg:

New Jersey’s Economy Gains, Still Lags New York: NY Fed Data

The Garden State is growing.

New Jersey’s economy accelerated at the fastest pace in almost 18 years though it lags neighboring New York state as it has since the end of the recession.

The Federal Reserve Bank of New York estimates New Jersey’s economy expanded at a 4 percent annual rate in July while New York state’s advanced by 8.2 percent. Growth in New York City alone expanded at a 3.9 percent pace.

The New York Fed’s coincident index is a single summary statistic tracking current data on employment, real earnings, the jobless rate and average weekly hours worked in manufacturing.

Posted in Demographics, Economics, New Jersey Real Estate | 90 Comments

Fighting against the “look” of urbanism

It’s ok, it’s less ‘urban’ if we make it look like a completely fake “farm”. From the Record:

Montvale Planning Board members call plans for Mercedes-Benz site ‘too urban’

The housing and shopping center design for the former Mercedes-Benz headquarters is “too urban” for the farmlike look of the area, Planning Board members said.

They said they want the housing and shopping center, being called Triboro Square, to have buildings with a country-like feel and architecture to match the structures and landscaping of The Shoppes at DePiero Farm across the street.

Planning Board Chairman John DePinto said there needs to be more “conductivity between the two sites.”

“I think it’s important that the developments rely on each other in part for their success,” DePinto said.

The area, traditionally home to large office campuses including Mercedes-Benz and Sony, may eventually be Montvale’s new downtown.

The Shoppes at DePiero Farm in recent years replaced DePiero’s Country Farm, a family-owned farm store in Montvale for almost a century. The center proposed for the former Mercedes-Benz corporate offices is just the next step on the road to more changes for the area, officials said.

Richard Preiss, planner for applicant SHG Montvale, said roof styles and some building aesthetics proposed for Triboro Square are similar to existing structures at The Shoppes at DePiero Farm. He said there are also differences.

Preiss said the proposed design does fit in with the current look of the area, during his testimony in response to Planning Board members’ concerns.

Posted in New Development, New Jersey Real Estate, Politics | 48 Comments

More like “Land of the Lost”

From ROI-NJ:

Murphy tells ROI: ‘We’re the land that time forgot here in terms of the development of this economy’

Following in the footsteps of the president under whom he served, Gov. Phil Murphy is trying to bring an innovation strategy to New Jersey in 2018 that is similar to the one President Barack Obama introduced to the country in 2009.

“We’re digging out of a hole,” Murphy said in a recent interview with ROI-NJ. “We’re the land that time forgot here in terms of the development of this economy.

“We used to be really good at it, we did it in our sleep — and then we stopped. So, we are pulling a lot of different levers right now.”

The economic strategy is one those in the technology industry understand well, and have seen growth from, in the last decade.

But, unlike the national-level support that Obama enjoyed in his first few years in office, Murphy has to focus on state resources to achieve any potential success.

“We can do a lot on our own, and we are,” he said.

Between free tuition for community college students and providing rent assistance to startups, Murphy is moving forward with many of the core areas of aid that he believes will lead to a stronger economy. He is supporting renewable energy sources and greater public-private partnerships, has revamped the research and development tax credit, and his administration has made an effort to put greater emphasis on incentivizing startups and angel investors.

Much of this has been either directly from his office or through the state Economic Development Authority. But Murphy made it clear it’s all hands on deck.

“I’m completely convinced you have to get at this in a variety of ways,” he said. “My hope, in the fullness of time, is that we’ll look back and say that we unleashed a lot of different levers in the innovation economy, and we’ll tweak it over time. My strong suspicion (is), like everybody, we all learn over time. What works best, what works less well.

Posted in Demographics, Economics, Employment, New Jersey Real Estate, Politics | 72 Comments

Sky is the limit for NJ … taxes

From the Record:

Analysis: NJ economic growth won’t sustain Murphy’s agenda, adding pressure to raise taxes

Fresh off striking a budget deal that included $1.6 billion in new taxes, Gov. Phil Murphy said he was banking on strong economic growth going forward to raise the money he needs to fulfill a long list of progressive promises.

“We’re neither going to cut our way to salvation, nor are we going to tax our way to salvation,” Murphy, a Democrat, said in a July interview with NorthJersey.com and the USA TODAY NETWORK New Jersey. “The road that we’ve got to be absolutely laser focused on is grow our way to a better tomorrow.”

But economic growth alone is likely to leave Murphy at least $300 million short — and potentially much more — of what he needs next year to cover pledged funding for schools, public employee pensions and other priorities, according to an analysis by the Network.

That could force him to make politically painful decisions to cut programs or push to raise taxes further.

Murphy has said that with better policies in place under his predecessors, New Jersey could have added $2 billion to $3 billion a year in revenue from economic growth — a mark he says the state can achieve under his leadership.

As it is, however, New Jersey hasn’t added $2 billion in revenue at any point in the past decade.

All the while, New Jersey faces ballooning pension costs for public employees, growing outlays for health benefits and a broken NJ Transit system that could prove expensive to fix. And that’s in addition to Murphy’s other promises to increase funding for public schools, expand pre-K, provide tuition-free community college and enhance tax credits for low- and moderate-income working families.

Posted in Economics, New Jersey Real Estate, Politics | 36 Comments

Good thing the rich are rich

From CNBC:

The $1 billion price cut: Luxury real estate gets slashed

The most expensive real-estate in America just became a little less expensive — with $1 billion in price cuts among America’s top listings over the past few months, according to a CNBC analysis.

The high-end real-estate market has seen steep price cuts in recent months as foreign buyers dry up, new tax laws bite the wealthiest states and sellers realize the market peak of 2014-2015 isn’t coming back anytime soon, luxury brokers say.

According to RedFin, the real-estate brokerage and research firm, fully 12 percent of homes listed for $10 million or more saw a price drop in 2018 — double the levels of 2016 and 2015. Just over 500 listings in the U.S. had a combined price cut of $1 billion in the second quarter, according to RedFin.

“Prices were growing too fast for what buyers were willing to pay,” said Taylor Marr, a senior economist at RedFin.

Even homes that see big price cuts are selling for less than their discounted prices. A 20,000 square-foot mansion in the Hamptons, once owned by fashion mogul Vince Camuto, was first listed in 2008 for $100 million. Its price got chopped to $72 million, and it sold this spring for around $50 million – half of its original listing price.

Even the Oracle of Omaha, Warren Buffett, has had to lower his asking price on his beach home in Laguna Beach. The home was listed in 2017 for $11 million, but he has slashed the price to $7.9 million. He’s still likely to make a big profit – he bought the home in the early 1970s for $150,000.

The reasons for the price drops are many. In some cases, the prices for the homes were fantasies. Sellers had irrational expectations or they were using the sky-high prices to attract attention to their properties. The luxury real-estate market has fallen since its peak in 2014 and 2015, and many sellers are finally adjusting to a different market.

Supply of homes at the high end is also high, especially for newer condos and spec homes in New York, Los Angeles and major metro areas.

“There could be an over-supply of these high-end homes,” Marr said.

Posted in Demographics, Economics, National Real Estate | 16 Comments

Price growth slows. Pause or Dip?

From CNBC:

Home price gains slow down in June: S&P Case-Shiller

Homebuyers are pulling back, and prices are finally following.

Home prices are still rising, but the gains are shrinking. In June, prices nationally rose 6.2 percent year over year, according to the S&P CoreLogic Case-Shiller Indices. That is down from the 6.4 percent annual gain in May.

Home prices in the nation’s 10 largest housing markets rose 6 percent annually, down from 6.2 percent in the previous month. In the 20 largest markets, prices were up 6.3 percent, down from 6.5 percent in May.

“Even as home prices keep climbing, we are seeing signs that growth is easing in the housing market,” said David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, in a release. “Sales of both new and existing homes are roughly flat over the last six months amidst news stories of an increase in the number of homes for sale in some markets.”

Rising mortgage rates are also taking their toll. The rate on the popular 30-year fixed mortgage rose from around 4 percent at the start of the year to just more than 4.5 percent now. That directly affects housing affordability.

Prices are still higher because of the shortage of homes for sale in general and particularly at the entry level of the market.

The supply of homes for sale in July was unchanged from a year ago, according to the National Association of Realtors. While it wasn’t a gain, it was the first time it didn’t show a negative annual reading in a few years. Builders still are not producing enough new entry-level homes to meet demand, and potential sellers are holding back, concerned they won’t be able to find or afford a different home.

Home price gains are still quite strong in the West, where supplies are leanest, but those gains are shrinking as well. Las Vegas, Seattle and San Francisco continue to lead the pack in price rises. In June, Las Vegas led the way with a 13 percent year-over-year price increase, followed by Seattle with a 12.8 percent rise and San Francisco with a 10.7 percent increase. Six of the 20 cities reported greater price increases in the year ended in June 2018 versus the year ended in May 2018.

“Population and employment growth often drive homes prices,” Blitzer said. “Las Vegas is among the fastest-growing U.S. cities based on both employment and population, with its unemployment rate dropping below the national average in the last year.”

The Northeast and Midwest are seeing smaller home price increases, as prices there weren’t quite as hot to begin with, and more supply is coming on the market. Some markets in the Northeast are also being hit by new tax laws. Washington, Chicago and New York showed the three slowest annual price gains among the 20 cities covered by the report.

Posted in Demographics, Economics, Housing Recovery, National Real Estate | 74 Comments

The Slump

From MarketWatch:

Pending home sales stumble as housing market momentum wanes

The numbers: Pending-home sales declined 0.7% in July, the National Association of Realtors said Wednesday.

What happened: NAR’s index, which tracks real-estate transactions in which a contract has been signed but the transaction hasn’t yet closed, fell to a reading of 106.2, missing the consensus forecast of a flat reading.

It was the seventh-straight month in which the index was lower on an annual basis — by 2.3% in July. In the first eight months of 2018, the index has charted monthly increases four times and monthly decreases four times. In July, the pending home sales index in the Northeast rose 1.0%, while the index in the Midwest inched up 0.3%. Pending home sales in the South fell 1.7%, while in the West, they were down 0.9%.

Big picture: Housing has stalled out. In July, total home sales — existing and new — sank below a key psychological benchmark to the lowest in two years. What had been a seller’s market across most of the U.S. hit a tipping point this year, as buyers decided the slim pickings on the market weren’t worth it.

What they’re saying: “It appears sales activity crested in late 2017,” said Freddie Mac Chief Economist Sam Khater earlier in August. “It is clear affordability constraints have cooled the housing market, especially in expensive coastal markets. Many metro areas desperately need more new and existing affordable inventory to break out of this slump.”

Posted in Economics, Housing Recovery, National Real Estate | 90 Comments

August Otteau Report

From Otteau Group:

MarketNEWS August 2018 Edition

The number of home purchase contracts in New Jersey increased by 4% during July compared to the same month last year. There has however been a noticeable change in the mood of the market in recent months as the pace of home sales has declined in about 1/3 of all markets on a year-to-date basis. As a result, the number of year-to-date purchase contracts (January-July) in New Jersey is up marginally by 1%, or roughly 800 contracts. While this is partially attributable to an under-supply of housing inventory, a growing affordability gap due to rising prices and interest rates is a significant factor.

While the number of year-to-date home sales has increased by 1% overall, that is not the case for all price ranges. Contract activity for homes priced under $400,000 have stagnated due to supply shortages, with unsold inventory having dropped by 9% year-to-date. Recording a 1% decline, are contract sales for homes priced between $1-Million to $2.5-Million (26 sales). This is somewhat misleading, however, given that this price range accounts for a much smaller share of sales. At the opposite end of the spectrum, contract activity for luxury priced homes over $2.5-Million has increased by an impressive 12% (208 in 2017 vs. 232 today).

Shifting to the supply side of the equation, inventory remains restricted, which is limiting choices for home buyers. The number of homes being offered for sale today in New Jersey has fallen to its lowest point since 2005, having declined by 725 (-2%) over the past year. This is also 41% less than the amount of homes (30,000 fewer) on the market compared to the cyclical high in 2011. Today’s unsold inventory equates to just 4.1 months of sales (non-seasonally adjusted), which is lower than one year ago, when it was 4.3 months.

Currently, 95% of New Jersey’s 21 counties have less than 8.0 months of supply, which is a balance point for home prices. Middlesex County has the strongest market conditions in the state with just 3.0 months of supply, followed by Essex, Passaic, Union, Somerset, Burlington, Hudson, Camden & Monmouth, which all have fewer than 4.0 months of supply. The counties with the largest amount of unsold inventory (6.5 months or greater) are concentrated in the southern portion of the state including Salem (6.5) and Cumberland (8.7).

Demand for rental apartments continues to expand in NJ with statewide occupancy rates being among the highest in the US. Statewide vacancy increased somewhat from the prior quarter, rising by 20 basis points to 3.8%. The rise in vacancy is attributable to the rapid growth in pipeline supply, which has increased from 7,600 apartments in 2008 to 32,000 today. Nationally, the average vacancy rate increased by 10 basis points to 4.8%. Still, statewide and national vacancy rates remain well below their 2010 peak having fallen by 140 bp and 320 bp, respectively.

Consistent with national trends, the homeownership rate in New Jersey declined precipitously with the onset of the Great Recession. The homeownership rate in NJ has declined from a peak of 71.3% in 2005.Q1 to 66% in 2018.Q2, which is 170 basis points higher than the national rate. This equates to a 7% drop in the homeownership rate, at both the state and national level. Because of this shift, there are approximately 208,000 additional renters in New Jersey.

Posted in Economics, New Jersey Real Estate | 49 Comments

Who does this?

From the Star Ledger:

‘My Lowe’s contractor doesn’t care, and Lowe’s doesn’t either,’ homeowner claims

When CherylAnne and Mike Amendola decided to expand and renovate the kitchen in their Lincoln Park home, they knew it would be a big job.

They decided to turn to Lowe’s.

“My family chose Lowe’s to complete our kitchen project mostly because of their safety guarantee,” CherylAnne Amendola said, noting she felt comfortable with Lowe’s taking on the responsibility of selecting the contractor for the job.

The Butler store said the kitchen, totaling $43,849 for labor and materials, should be completed in about eight weeks, documents show.

But now, more than four months later, the job remains unfinished.

The couple signed the contract on April 18. It included everything from plumbing and electrical to cabinets, flooring and appliances – the whole kitchen, soup to nuts.

There were delays from the start, the couple said.

A month after they entered into the contract, the couple learned from the town that the company hadn’t yet filed for permits.

The Amendolas said they asked Lowe’s for a timeline, but Lowe’s said it couldn’t get CJS to commit to a schedule, documents show.

“On May 24, CJS told our Lowe’s project manager that they had filed for the permit, but they did not, according to the town,” Amendola said. “After chasing after them for a permit, they finally filed for it on June 4, five days after they demoed our kitchen.”

On June 1, work stopped without reason, Amendola said, and no one returned to the house for more than a month – until July 6.

Frustrated and getting no answers from CJS, Gotay or Lowe’s, Amendola started posting videos on social media to document her experiences. She calls her series of videos, “My Lowe’s contractor doesn’t care, and Lowe’s doesn’t either.”

Posted in New Development, New Jersey Real Estate | 81 Comments