Hoboken, NJ

So much bad news!

We've all heard the headlines. "Inflation roars its ugly head"; "Worst economy since the Great Depression!"; "Foreclosures hit an all time high!" It's amazing how we get up in the morning to go to work!

Here's my take on this.

"High oil prices perfectly positioned Hoboken for continued success!" I like that headline!

There have been recent trends of people opting to stay close to employment and entertainment centers and the high cost of oil will continue to "fuel" this demand.

Hoboken's prime location positions it perfectly to take advantage of this trend and should help keep the real estate picture stable for the foreseeable future.

With a multitude of commuting options into Manhattan and other high density employment hubs in New Jersey, Hoboken with its PATH trains, ferries, buses, New Jersey Transit trains, light-rail system and double tunnel system into Manhattan offers it's residents easy access to these centers, often times saving workers hours of time compared with their suburban brethren.

Combine this with increased improvements to infrastructure and lifestyle amenities such as the new Pier Park C, The W Hotel Hoboken, refurbishment of the Erie Lackawanna ferry terminal, new 5 screen movie theater and the upgrading of buildings, retail and restaurants, Hoboken should be the golden pot at the end of the rainbow of the otherwise stormy national picture.

All this and we have great housing selection, prices and mortgage rates!

That's why I get up to work in the Hoboken market every morning!

Eddie Perez

Open Houses Don't Sell Condos

There is a myth in the real estate business. It's one that's been around for a long time. It's especially entrenched in urban areas like here in Hoboken. Sellers put their Hoboken condo on the market and think that their agent should hold an open house every weekend until the property sells. They believe that a buyer is going to walk through the door, fall in love with the property and pull out their checkbook. Selling a condo at an open house is a rare event. There are people who make a recreational activity out of visiting weekend open houses. It's something for them to do after brunch - to check out their neighbors' condos and pick up some decorating ideas and renovation tips. The vast majority of visitors to open houses are not in the market to buy a condo in Hoboken. So should agents be firm and tell the sellers to get real and stop holding them? Probably not.

Buyers Want to Window Shop

There is no doubt that today's buyers start their search on the internet, especially young, smart, sophisticated Hoboken buyers. Nonetheless, pictures and even video only go so far. There is nothing like the real thing, baby. Being able to walk into a property at ones leisure is a nice opportunity for a buyer to window shop without feeling obligated to an agent, without having to make an appointment in advance and without the fear of pressure from a possibly pushy realtor. Going to open houses is a great way for a buyer early in the buying process to test the waters.

Sellers Want to Know

An open house lets your agent get an idea of what the browsing public thinks of your place. Now, most people have some social grace. They are not going to walk in and say "what an awful property". If your agent is perceptive and can read body language and make people feel at ease they should be able to get a pretty good idea of what most people like and don't like about the unit. A good agent will communicate that information back to the seller so changes can be made where possible. It also adds credibility to what the agent may have been trying to tell the seller from the start. If the fuschia curtains just don't work in the living room it may help to convince a stubborn seller when the seller hears it more than once.

Even The Most Committed, Serious Buyers Want Some Freedom & Flexibility

Some buyers are actively engaged in the house hunt and have been working with an agent. In Hoboken most agents know each other and work together frequently. If a buyer wants to go out looking at properties and the buyer's agent can't accompany them it is common for the buyer to go to open houses on the weekend alone. When they are asked to 'sign in' they let the host know that they are already working with a certain realtor. That relationship is (and should be) honored by the hosting agent. This gives the buyer a way to go out looking at his convenience without having to have his agent there while still being loyal to his agent. If the buyer sees something he likes, he will typically go back with his agent to see it again. He then has the assistance of his agent should he decide to move forward. But a buyer, even if working with the best realtor in town, can just stroll into an open house on a whim.

Open Houses Can Even Be Good For the Agent

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They've Got To Be Kidding!

I saw an interesting Hoboken condo property yesterday. A 10 unit building was gut renovated and all the units were for sale, a few already under contract. The building was your typical Hoboken 5 story walk-up with the staircase in the center and a 'right' and 'left' unit on each side of the building. If you've ever seen them, you know that these units can be very long and narrow. The location wasn't bad - the 300 block of Grand Street. That's between 3rd and 4th Streets, on Grand. Remember that for later.

We went into one of the units listed as a 2 bedroom, 1 1/2 bath for $439,000. The unit was 670 square feet - pretty small for a two bedroom. In fact, just knowing the square footage makes you wonder how two bedrooms could possibly fit. Most two bedrooms in Hoboken condos are closer to 1000 square feet.

Two Bedrooms and No Living Room

Squeezing two bedrooms into 670 square feet takes a bit of doing. If you design an open kitchen with a 2 seat breakfast bar, the area on the far side of the breakfast bar is your "living room". A very tiny living room but you could theoretically fit an Ikea love seat and coffee table into the space. Forget about having a real sofa. Given the space (or lack thereof) what would make more sense would be to treat the second bedroom as the living room. Perhaps even remove the wall between the 'living area' and bedroom or open it up with pocket or French doors. But then you've got a $439,000 one bedroom. At least you'd have a reasonably sized living room.

Whatever You Do, Don't Open the Kitchen Drawers

Let's consider the kitchen. It has about 6 cabinets total, 3 uppers and 3 lowers. My favorite was the cabinet between the sink and refrigerator. In order to open one of the few the drawers, you must first open the refrigerator door. That's right - you must open the refrigerator door - all the way - in order to open the drawer. Otherwise the drawer just hits the refrigerator, eventually denting the stainless steel. The corner cabinet beneath the drawer was essentially wasted space since the door only opens about a third of the way. Since corner base cabinets are where one would store things not used very frequently - like big pots, the door's inability to open renders the whole cabinet sort of useless.

What Does That Glossy Brochure Say?

There were very fancy, clearly expensive brochures in the condo. The very first page touted "attention to detail". Inside it, I was stunned to see the "Neighborhood" section with a full page photo (the only full page photo in the brochure) of the Elysian Cafe. I guess if you consider all of Hoboken your neighborhood the Elysian is in the neighborhood of 3rd and Grand Streets. The Elyisian is uptown at 10th and Washington Streets. Not exactly the same neighborhood as 3rd and Grand. Nice try, though.

My Condo Comes With a Transient?

Even more unbelievably was the page of the brochure that listed the condos' features. Among them was "glass transients and doors". Someone doesn't know the difference between a transom and a transient. A transom is the horizontal glass window often found above doors in Hoboken properties with high ceilings. They would be opened up at night in the old days to allow air to circulate through the long, narrow apartments. A transient is something fleeting, like my respect for the intelligence of the people who wrote this brochure. The property is listed with one of the largest brokerages in the US. Don't they have proofreaders?

Given the obvious lack of attention paid to quality in both the design of the units and the promotional materials used to sell them, buyers' interest in buying these Hoboken condos are going to be pretty transient, as well!

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With a Multiple Listing Service for Hoboken Real Estate, Everybody Wins

I had an interesting phone conversation this morning with a potential buyer of a Hoboken condo. He wanted to see condo properties in both Hoboken and Manhattan. I was explaining the difference between how real estate brokerages work in Hoboken (and New Jersey in general), where there is a multiple listing service (MLS), vs. Manhattan, where there is not.

If you are a Hoboken condo buyer and find a nice property on-line, say at trulia.com or notice a "for sale" sign on a building while walking down the street, chances are pretty good that the property is listed on the MLS. The agency that listed the condo has agreed to cooperate with every other agency in town to allow all agents to show that property. The more times a condo is shown to buyers, the more likely it is to be sold and at a higher price which is better for the seller. The sales commission agreed upon by the seller and the listing agent, typically 5% in Hoboken, is divided 50/50 between the listing agent and the agent that finds a buyer for the condo. If you're a buyer and have developed a good working relationship with a particular agent, he or she can show you the place you found on line as well as any other property on the MLS. The buyer wins because the agent gets to know the buyer's likes and dislikes, doesn't waste the buyer's time showing inappropriate properties, and by being loyal to that agent, he or she works that much harder to find the perfect property. After all, agents don't make a penny working with the buyer unless the buyer actually buys a condo.

Agents Don't "Compete" For the Buyer

At this point my caller objected. He said he would not work with a single agent because that would not be in his best interest. If all the different agents are competing with one another, he explained to me, he would pay less for his condo. Huh? I pointed out that if he were to buy a condo directly from the listing agent he would still pay the full commission. The entire commission would go to the listing agency. Listing agents don't give up half the commission when they sell their own listings! Furthermore, I explained, the listing agent represents the seller. It is often debated whether it is a conflict of interest for a listing agent to also represent a buyer (called dual agency). How can a seller's agent work for the buyer and act as a fiduciary of the seller with an obligation to obtain the highest possible price for the seller's property? He still didn't get it. If he didn't want to work with a single agent and instead went to every agent in town telling them he wants them "to compete for him." Outstanding agents with knowledge and skill are in high demand and don't have the time or patience to deal with a "high maintenance" buyer who thinks he's going to outsmart the world. This buyer may only outsmart himself winding up with an novice agent, and will end up paying the same commission anyway. The really good Hoboken agents often have more business than they can handle.

The Commission is Just "Wrapped Up" in The Sales Price

My caller may have thought that, as a buyer, he had some ability to change the commission to be paid. Maybe he erroneously thought that the seller pays the listing agent only half the agreed upon fee for selling the condo herself or that the fee varies depending on which agent he uses to find the condo - wrong again. The commission is set no matter who sells the home. Sometimes, a seller and listing agent do agree when listing the property that if it is sold "in-house" that is, by the listing agency, the fee might be 4% instead of 5%. That has to be disclosed in the listing information which every agent can see. Which agent finds the property for you has no effect on the sales price. With one exception.

An Agent's Negotiating Skills Do Matter

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Hoboken Condos Lure Buyers in April

April was a pretty good month for Hoboken condo sales. The end of month numbers are in and Hoboken condo sales remain fairly strong. I know, there are stories in the press every day about the collapse of the housing market and we all have witnessed prices skyrocket at the gas pump and grocery store. While our country has some significant economic woes that are likely to get worse before they get better but, for various reasons, people want to live in Hoboken and continue to be willing to pay top dollar for Hoboken real estate.

Average Sales Price of Hoboken Condos is Up 8%

April sales figures represent a 8% increase in average sales price for a Hoboken condos compared to last month. The average price of condo is now just over $560,000. That's 5% over the same period last year but 3% less than April 2006.

Price per Square Foot Down Slightly

Last month the average price per square foot for a Hoboken condo was $520 and in April it was $517. Of course, that is just an average and the real number varies depending on the usual factors - location, condition, and promotion. The mix of units sold each month also has an impact on this figure. Smaller units tend to sell for more per square foot than large ones. So if more large units sell in a given month it may tend to pull down the average. This may have been the case here since the average size jumped from 1000 square feet in March to 1087 in April.

Hoboken Property Is Selling Briskly - 72 Days on Market is Average

The standard measure of sales activity is "days on market". This number dropped from 90 days in March to 72 days in April. Of course, the nice weather has an impact on how many buyers are willing to go out condo shopping. We are in the midst of prime selling season.

Here is a Chart View of Monthly Hoboken Condo Sales To Date:

So How Much is My Condo Worth?

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