Now what?

Since Lehman Brothers problems, and the economic bailout of Wall Street, several weeks before the election, real estate in Hoboken has been quiet. New sales are down dramatically. That said, sellers still need to sell for personal reasons such as a new baby or babies, or because of a job relocation. Buyers are finding that prices have come down or that sellers are more negotiable. Those buyers out looking now can find great buys.

The sellers hit hardest are those who bought in the last two years. They are more reluctant to sell their place for a great deal less since they have built up little or no equity, and in many cases lost equity in the past two years. This was very unusual for Hoboken and very disappointing for these homeowners. Some of these homewowners are choosing to rent their condo for the time being until the market improves. This has caused a glut of rentals and prices have come down somewhat on rentals as well.

Sellers losing money in this market should try to remember that though the real estate market in Hoboken is normally very stable, financial loss can happen, just as it has on Wall Street. But whereas many peoples investments have lost 30-40% since black October, the housing market in Hoboken has more typically lost 5% value in the last two years. There is risk in any investment, even Hoboken real estate, but the upside is that most of the suburbs have suffered worst declines and the loss in value here is often more than made up for on the buying end of a new home in either the NJ suburbs or in many other cities.

The sky is not falling. We may not achieve equity increases until 2010 but there is reason to believe that the decline in real estate value will lessen and prices stabilize in 2009.