Monday, July 7, 2014

Q2 2014 Review - Hoboken Real Estate Review - Where is the Market Going?

Quarterly Review, hudson real estate monitor, Donna Antonucci
Summers are here and so as the Hoboken's second quarter market review...

There were 302 closings during Q2 2014. This includes condos and 1-4 families sales. 

I like to look at price per square foot by contract date. The price per square foot by contract date is a more accurate depiction of pricing because it's the contract date where the buyer and the seller have come together and agreed on a price of a specific property. It takes 4 to 8 weeks to close depending on whether it's a cash deal and how unique the property is. That is, a 1-4 family, generally, takes more due diligence than a condo.

There are a variety of reasons why a closing may take longer than this. One typical reason why the time from contract to closing takes longer than this 6-8 week period is because the unit goes under contract in pre-construction. A property sold in pre-construction can remain under contract for 6-8 months or even more. Because the decision point to buy and the agreed upon price were made so far in advance of the closing, the price is not necessarily a reflection of pricing at that time of the closing.

Quarterly Review, hudson real estate monitor, Donna Antonucci

As shown in above chart, The price per square foot for a 3 bedroom condo started from $495 in the month of April was lowest and highest in May at $625. The average 2 bedroom over the period was 1,116 square feet sold at the average Price Per Square Foot (PPSQFT) of $590 which is $62 more than Q2 of last year.  In April, the average 2 bedroom went for $634,234, $714,045 in May, and $628,249 in June. Quarter high for 2 Bedroom was at $714,045 in May.

Although small numbers, 3 bedroom category are huge in demand.  I have several clients looking for 3 bedrooms and I can tell you it's very difficult.  Listings are going at highest and best within days of hitting the market like no other segment.  There just is not enough 3 bedrooms as more and more people want to stay in this area instead of taking on a long commute from the burbs. 

I also want to point out, that the durations shown here is the contract date minus the listing date, however, most agents put in the date that attorney review closes, not the date the initial contract is signed by both parties.  That is, these durations are about 7 days to 2 weeks longer than when the offer is accepted by the sellers.  In NJ, we have attorney review.  After an offer is accepted by the seller, ie he countersigns the contract, the deal goes into attorney review.  It can take the attorneys 7 days to 2 weeks to review the contract and complete an addendum signed by both the seller and the buyer.  It's at this point the deal is binding for both parties and it is this date that goes in the MLS.  I am pointing this out because even these durations are deceptively long in relation to how quickly listings are no longer available.  Prospects often don't want to see properties where an offer was already accepted and very often, if the property is Tenant occupied, the owner stops the showings.

We started this quarter at 205 houses for sales in April listings in Hoboken now gone up to a 213. Prices recorded shows the slight increase during this quarter however inventory is increasing and from the beginning of March at an increasing rate.  

Total unit sold in Apr was 86, 113 sold in May and 103 in June. As expected, spring recorded good number of property sold during this period. The market is still expected to go up in during summers, as more people plan to shift during this season.

Pricing is very very important and it's critical to sellers to get an agent who can price your property correctly.  Once you introduce your property to the market place as  New to the Market, you can re-announce it.  It's like the premier of a movie.  You can't re-premier it.  You can only create that excitement, that frenetic emotional buying once.

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3 and 4 bedrooms are too low in terms of units to determine any meaningful trend here but there is enough volume in the one and 2 bedrooms in terms of number of closings. The duration measures the time the listing went up to the time the unit went under contract.  Duration for 2 bedrooms went from 37 days, to 18 days, to 17 days during April to June quarter. Duration for the previous quarter was 41 days, 35 days and 26 days. This is a good indicator to the market. This means market are really good for sellers with less waiting time to sell their property. The duration for 1 bedrooms went from 47, 33 to 34 for April, May and June respectively. 

Here is the price per square foot chart that shows how prices have ticked up. 

Quarterly Review, hudson real estate monitor, Donna Antonucci

All and all the market needs listings.  If you are ready to move and you have waiting for a good time to list, this is it.   

Quarterly Review, hudson real estate monitor, Donna Antonucci

The absorption rate during Q2 2014 was 2.66 months in April, 2.09 in May and 2.01 in the month of June for Hoboken, NJ. The absorption rate is a number that describes how many months it will take to see off the current inventory at the current rate of sales.

Quarterly Review, hudson real estate monitor, Donna Antonucci

302 properties were sold in last Quarter. The number includes condos/coops, 1-4 families sold during this period. 

All and all the market needs listings.  If you are ready to move and you have waiting for a good time to list, this is it. 

Stay tuned for JC results ......

Information Provided by Donna Antonucci