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Re: The Financial Times: Jersey City -- You live where?

Geez, how many times have I read something like this?
I grew up on Long Island and have lived there and here in Hudson county just about all my life and the only people who ever grouse about some stigma on the Jersey side are people who aren't from the area. None of my Manhattan friends (who grew up in Manhattan) or friends and family in LI and NJ feel any stigma about this side at all - it's all the NYC area, and you live where you live and it's psychically New York City even if it says New Jersey. And everyone knows the JC and Hoboken had a bad rap once - but so did the Village and Williamsburg (was way worse, by the way) once.
The people who do talk about a Jersey stigma and those who have some weird self-prohibition against leaving Manhattan because they came from somewhere outside of the area, are killing themselves to pay their $2,500 a month for a one bedroom somewhere between the rivers and feel they'd die if it ever got out to their friends and family in Podunk that they went to a party in New Jersey (so not glamorous!) or are so lacking in self-confidence that they have to spend a lot of effort justifying why their phone doesn't start with 212.
I'm going back to my coffee, reading about the Yanks and looking forward to my quick run into dinner in Tribeca tonight without worrying about my feelings on where I live.

Posted on: 2007/9/1 12:09

Re: "A" Condiminium Pricing

Owning is great - there are lots of advantages - so there are deductions (common fess, though generally aren't deductible) I didn't mention. Plus there is the general positive nature of owning where you live and of building equity over time with money yopu probably wouldn't squirrel away if you didn;t have to. My real point is that historically anywhere, what something should cost to buy acts in relation to what it costs to rent (whether you want to rent it or not), which I why I mention the rent comparison at all.
Take it another way. At $575,000, that's 13 times a year's rental income if you could get that $3,700 a month in rent (that is, the is what's called the 'cap rate', the number of years it will take you to earn back the money you invest). But, you have to assume there will be some vacancy. Typically, you assume 15% of the time the unit will be vacant, so then gross rental income is $37,740 a year, so that brings it to a smidgen over 15 times gross rental income. If you look at what you can get in the market, let's assume $3,200 a month, less that 15% vacancy rate, you're looking at 17.6 times (that is, a cap rate of 17.6). Before the real estate boom really took off about 3 years ago. the typical cap rate downtown was 14 for decent properties and the typical cap rate in Manhattan was 17 to 18 for an apartment.

I don't mean to be so negative - I love Jersey City and think the development is ultimately good for the whole city. I've been wanting to buy since I sold in Hamilton Park two years ago, but the numbers just don't make sense to me. That also doesn't mean I think condos will never rise in value from where they are now, or that the 'A' isn't a good investment or home for the right person, I just think the market is well ahead of itself now, and it will be a long time of stagnation before they would grow again.

Posted on: 2006/11/7 17:13

Re: "A" Condiminium Pricing

Wow. So if you put 20% down on the 2 bedroom and you get a mortgage of 6%, your monthly payment is around $2,750 a month, then add on taxes which will be around $8,500 (about 1.5% of the purchase price) and say a measly $200 a month in common fees, your cost is $3,666 a month. Is there any way in the world anyone could rent that out to cover that price (let alone make a return on that $115,000 down payment)?
The price is out of whack, but then so has the JC market for a few years.

Posted on: 2006/11/7 13:53

Re: Whole Foods in JC?

Whole Foods' corporate website doesn't list Jersey City as having a store in development. I've also heard it said that there will be a whole foods in new developments on the marina. I think developers and/or realtors must spread this rumor to make properties seem more attractive.

Posted on: 2006/4/11 17:51


I guess I shouldn't be surprised - a government official arguing that more government regulation actually makes markets more efficient! I respect your running these ideas past people in the site, but I have to say that legislating mandatory parking will (at least in the near term i.e. four, five years) will create greater inefficiencies that hurts renters and benefits wealthy developers. A renter will be less able to choose a cheaper off-street parking option because that they have no choice but to rent one from their landlord. What happens when landlords raise parking spot rents 25% a year? Well, I suppose, people can just move - but that's not so efficient for people's lives or their wallets. Give the market a shroud to push through price hikes, and it will take it Forinstance, when the E.U countries legislated the switchover to the Euro, it theortecially shouldn't have meant an increase in prices - yet in reality it did, on a magnitude of 20-30%. Closer to home, as a JC landlord, if the city bumps up my water bill or property taxes 3-percent, I raise my tenants rent 5-percent and blame it all on the government (can you blame me? perhaps I wouldn't do it if I had a nice tax abatment though, can you help me out there?). I hate to say it, but there will be a situation of landlords charging rent of $x plus $200, at least in the next few years after your legislation goes through. In the long-run, the efficient market will mean people will get priced out, and new wealthier people will move in. Okay fine. If you really care about efficient markets, get rid of abatements for wealthy developers which results in a higher burden on individual property owners and stop treating renters and property owners differently based on where they live and what they own.

Posted on: 2006/2/22 19:48

Re: Flood Insurance.......Do You Need It ?

Depending on what causes your water damage, your hazard insurance may cover it (i.e. broken sewer, water heater etc.). Flood insurance is generally only good for a total loss. The geniuses at FEMA have a web tool to find out how hazardous your location is to flood: and choose number 2 on the upper right hand menu.
Pretty much anyplace in downtown JC they'll say is high risk. Of course, they won't be able to do anything if something happens, even if Dubya calls for a 'War on Water'

Posted on: 2005/9/9 21:59




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