Sunday, October 25, 2009

One, One-Fifty, Two-Fifty - Cost of Luxury

Hundred, that is. That is how much incremental monthly maintenance you should expect to pay for each an elevator and a doorman in one, two and three bedroom condominiums in the north east section of Hoboken. In other words, if you are looking at a one bedroom unit in a building with an elevator and a doorman, expect to pay two-hundred dollars a month more in maintenance fees that a one bedroom in a brown stone or conventional building.

So what if you want a third bedroom? From a three bedroom, two bath perspective, there are two specific properties on the market in the north east section of Hoboken, as of October 24, 2009.

MLS # 90008783 – has been on the market for three and half months at 1500 Garden, unit 9G is listing for $1,499,995. This unit has a monthly maintenance fee of $1,162, is 1,910 square feet which puts it at $785 per square foot.

Contrast this property with the only other three bedroom on the market, MLS# 90013090 – which just came on the market this week at 2 Constitution Court. This unit is listed at $949,000, has a monthly maintenance fee of $958. And is 1,343 square feet, putting it’s price at $707 per square foot.

There are eight other three bedroom units each with three bathrooms on the market in north east Hoboken currently. The average statistics for these units are: Avg Price $1,244,489; Avg monthly maintenance $916; Avg square feet 1,861; and Avg price per square foot $669.

So while the 1500 Garden Street property is larger, is that much more living space worth the incremental $550,000 to you? Is a three bedroom, three bath unit more appropriate for you? Only you know how a space fits the needs of you and your family. We will be happy to schedule a showing of any of these properties and help you evaluate which unit is right for you.

Thursday, October 22, 2009

Maxwell v The Constritution - How do they Compare?

As you can see from the chart, The Constitution has a better price per square at $537 v. $595 for Maxwell Place. Having said this, there is a relatively small number of sales and the difference can be the unit placement within the building of those used in this study. These are all the 2009 sales in the both buildings including those that did not go through the multiple listing service. I do feel this is a good sample and we'd see the same trends year over year between the two buildings.

Maxwell Place has better layouts and kitchen finishes. Many of the layouts in the Constitution have enclosed galley kitchens and parquet floors which are not as popular today as open plan kitchen-living room layouts and satin finish straight hardwood. Maxwell Place also has small balconies on all units. The space is small but it's one additional features that is not reflected in square footage but boosts the price per square foot in the end.

As you can see from the pictures below, Maxwell uses dark finish cabinets and light countertops that open to the the main living area. The next pic is of the standard kitchen installation at the Constitution - white appliances and cabinets in a galley kitchen style. The last pic is of resale kitchen in one of the Constitution's penthouses - lovely country design but still cut off from the main living space.

This is part 2 of 4 on our series on the cost of Luxury. Stay tuned for our review of the Tea Building and the Garden Street Lofts.

Friday, October 16, 2009

What Does a Doorman Cost?

The north east end of Hoboken is punctuated with luxury buildings. Are the amenities, such as doormen, worth it to you as you assess where to invest for you and your families future? Let’s see what historic sales data can tell us.

What does a doorman REALLY cost? Two bedroom units that sold in 2008 and 2009 with a doorman sold for 75% MORE than units without doormen, translating to a greater than $100 per square foot differential. One bedroom units with a doorman are actually seeing a better premium in price in 2009 versus 2008, with a lift of 62% higher sale price than non-doorman buildings in 2009, versus 51% in 2008. Are the units bigger? Sure you are getting on average an extra 400 and 125 square feet for two and one bedroom units, respectively. That translates, on average, to $325,000 more for a two bedroom unit and $200,000 more for a one bedroom unit in buildings with a doorman.

Will my property be worth more or depreciate less in a doorman building? For a one bedroom unit, the extra amenity may help your relative market position. The PERCENT change in value two bedroom units is about the same, at 7% less for each of the last two years. One bedroom doormen units did slightly better in terms of holding onto more value a 7% decline versus 13% for non-doorman units.

So what else is your money buying? It’s not just the doorman that drives the value. Buildings with doormen almost always also have elevators, many have exercise rooms and laundry in each unit, and for two bedroom units, an additional second bathroom.

Clearly lifestyle and overall amenities are key factors in making a decision to purchase in a luxury building and only you can determine if they are worth that investment. Whatever your needs, we can help you find the ideal unit for you.

Harborside - How do agents assist clients in making a bid?

How Do Real Estate Professionals Develop a Price Recommendation When Assisting a Buyer in Making an Offer

The first thing a real estate professional will do to help a client decide what to offer on a home, is to find comparable sales (comps). You have to look at a comparable building if not the same building, location within the building, finish level, square footage and view. And then, we calculate the price per square foot.

Here, is an analysis of Harborside Lofts. This is a building where some were sold in pre-construction (sales in 2007), after the developer obtained the certificate of occupancy in 2008, and we start to see resales in 2009.

Notice how unit 'F'- the north east corner unit has the highest price per square foot. This is because is has the most expansive views of the Hudson River. In the diagram, notice how I have the Hudson River Cove marked. This is where the Hudson River dips in to the west and hooks around to the north ending at the Riv Point Condominiums creating a Cove. This is great because it provides water views for unit 'G' as well. Notice how unit G has the next highest price per square foot.

Also notice how the price per square foot varies over time. Unfortunately, I think all of us are all too well aware of the stock market crash of October 2008. That means anything that went into contract before October of 2008 would not be a valid comparable because that was a different market. Banks typically won't use comps that are older than 6 months. In the event of a market changing event like the crash of October 2008, they could easily change their policy that the comps have to be newer than that or the buyer has to put more down. In fact, that's what we saw last year, even with 3 good comps, the market was so unstable banks were requesting 25% down on a conventional mortgage (and/or to avoid private mortgage insurance)and were trying to get 4 comps. Some transaction that began before October but were still in progress were required to get an additional comp, have the appraiser re-assess the same comps or both. So, "recentcy" is a big factor in determining whether or not a comp is valid for developing an offer..

So, once we have recent comps for the building or similar building,taking into account floor level . . . .(without an elevator the lower floors are worth more, in an elevator building the upper floors are worth more). In the case of Harborside Lofts each floor you go up is worth about $10,000. Use those comps to determine the price per square foot. Take the square footage of the unit you are looking at and multiply it out.

9G is for sale. 2G is the most recent comparable sale from the building with a closing date of August 1st of 2009 for a sales price of $1,062,000 or $556/square foot. 9G has the same square footage as as 2G but it's 7 floors higher or should sell for $70K more. Will it sell for $1.132MM? We are going into the dog days of Winter. Will it sell before the close of the season at what price? Check back in 3-6 months and let's see how the sellers did in selling this unit.

Harborside has great views even to the west. It has a park to the west of it and the new park at 1600 Park Ave. should be in sometime next year. The small patch of land just to the north of Harborside Park has been donated by the developer to Greenacres so even to the west, homeowners enjoy unobstructed views including the beautiful Palisades Cliffs. These units have a lower price per square foot.


This article is one of our 4 part series on Hoboken's Luxury buildings. How much is luxury worth - Concierge, gym, pool, roof deck, parking? Read the series and find out.

Thursday, October 8, 2009

Sunday, October 4, 2009

Hoboken Real Estate Sales by Year

This is a great graph that shows how the spring culminates in the highest sales. All of those properties listed in February and March close before the Summer. Home buyers want to get in their new home over the summer. People are busy with summer outings to look at real estate.

It also shows the peak years of 2005, 2006 and 2007. Conversely, the poorest year is 2009 which means that prices are down. Is it the bottom?

Hoboken Residents by Age

Weekly Market Statistics by Quadrant, ending 9/30

Weekly Stats 9-30-09-Updated