heights wrote:
Maybe that's why most of these new property developments are not going condo but being rented out as apartment buildings. And I thought real estate was a sure fire bet.

user1111 wrote:
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Wishful_Thinking wrote:
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user1111 wrote:
More than 240K N.J. mortgages said to be 'seriously underwater' What bubble?

I wonder if you have to further break down the statistics, by ward or neighborhood. For instance, in NYC there are lots of foreclosures in outlying, less gentrified areas like Flatbush but practically none in Manhattan. The average may not show the full picture

I know many of my fellow owners in our building in the Heights are either underwater or equity neutral, because the Heights is still stuck in the doldrums. I bet the picture for prime downtown neighborhoods is very different.

I have two personal friends downtown who are under water. Their condos are nit worth what they paid in 2006.

Wishful_Thinking wrote:
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user1111 wrote:
More than 240K N.J. mortgages said to be 'seriously underwater' What bubble?

I wonder if you have to further break down the statistics, by ward or neighborhood. For instance, in NYC there are lots of foreclosures in outlying, less gentrified areas like Flatbush but practically none in Manhattan. The average may not show the full picture

I know many of my fellow owners in our building in the Heights are either underwater or equity neutral, because the Heights is still stuck in the doldrums. I bet the picture for prime downtown neighborhoods is very different.

user1111 wrote:
More than 240K N.J. mortgages said to be 'seriously underwater' What bubble?

jcwalkingman wrote:
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SRhia wrote:
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jcwalkingman wrote:
It appears that one of the most active developers downtown thinks there may be a bubble. Prices were slashed by about 30% on units in one of the few new condo buildings downtown yesterday.

So - which building/developer is it???

All I can say here is check Trulia for listings posted within the past few days, then compare listings posted yesterday to websites of new condo buildings in downtown You'll see it...I didn't think they'd be doing this so soon but I guess they see where the market is heading.

SRhia wrote:
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jcwalkingman wrote:
It appears that one of the most active developers downtown thinks there may be a bubble. Prices were slashed by about 30% on units in one of the few new condo buildings downtown yesterday.

So - which building/developer is it???

jcwalkingman wrote:
It appears that one of the most active developers downtown thinks there may be a bubble. Prices were slashed by about 30% on units in one of the few new condo buildings downtown yesterday.

jcwalkingman wrote:
It appears that one of the most active developers downtown thinks there may be a bubble. Prices were slashed by about 30% on units in one of the few new condo buildings downtown yesterday.

SRhia wrote:
I think the "think long term" approach is definitely correct in regards to Real estate. however, for anyone with limited money in the bank, a 1-bedroom costing $350K (circa 2010) is very different than what it could cost today (around $500k+), and a brownstone in the same period (probably $500K+ difference in purchase price)?

As much as I'd like to buy a brownstone today, I don't have the down payment, nor the ability to pay monthly mortgage payments for a $1.5mil property. However, if it's "only" $1mil, then perhaps there's some hope for me...

user1111 wrote:
Depends on where you buy this "brownstone" there are brownstones all over Jersey City. You can still find a brownstone in the JSQ area for 325K and the further up you go the less expensive it is.

brewster wrote:
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JCMan8 wrote:
Frequently what happens is people sell after the market has already gone down a ton, in order to "cut their losses" and ensure they won't lose more. But when the market starts going up again, they don't trust it. They only begin to trust it once it's been up for a while, at which time they buy back in. Selling low and buying high, that's how you lose your retirement.

I'm certain I've told this story, maybe even in this thread, but in 1996 the 1st properties we ever saw in JC were owned by an investing group that wanted out after the market had tanked in 89 and not come back. He showed us a condoed 6U on 8th between Monmouth & Brunswick. $190k, for the whole thing. Now each unit is probably double that. Think long term or don't play.

JCMan8 wrote:
Frequently what happens is people sell after the market has already gone down a ton, in order to "cut their losses" and ensure they won't lose more. But when the market starts going up again, they don't trust it. They only begin to trust it once it's been up for a while, at which time they buy back in. Selling low and buying high, that's how you lose your retirement.

SRhia wrote:
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JCMan8 wrote:
SRhia, the last time we had a major downturn, the stock market plummeted. Do you know if the people you are referring to also took their money out of the market?

The husband told me (1) not to go into bonds (coming from a bond guy); (2) not time for commodities yet either; (3) stock market is still the place to be for the long run. I think what he meant (if I understood him correctly) is that the stock market may/probably will tank (along with everything), but once that happens, between bonds and stocks, he'd still put his money in stocks as that would still outperform bonds in the loooooong road to recovery.

I'm shifting my portfolio to cash (not just based on what he told me, but from all the reading I've done), and is waiting for that opportunity that I'll be set for retirement. Fingers crossed!!!!!

PS I just hope I'll pull the trigger at the right time. Otherwise, the bet could go very wrong, and I'll lose my pants and say bye bye to retirement

jcwalkingman wrote:
I've been in the market to buy a condo and looking at units in the newer buildings downtown (Grove Pointe, Waldo Lofts, Gulls Cove, and Sutton) and pretty much every single one bedroom that's been for sale since at least August was being held as an investment unit prior to being listed. If the investors are all cashing out now, it doesn't seem like there's much confidence in prices appreciating too much further. I've put my search on hold & plan on riding this one out...

I won't go into the risks of buying now in this post because I've been posting about them for at least a year in this thread, but I will say that this is a really really bad time to buy downtown (just look at all the things propping the market up right now...)

JCMan8 wrote:
SRhia, the last time we had a major downturn, the stock market plummeted. Do you know if the people you are referring to also took their money out of the market?

SRhia wrote:
@jcguy05 - how long do you think it'll take prices to come down? We've been dreaming to upgrade from an apartment to brownstone, and is now saving money. I know no one can predict the future, but I'm interested in hearing your thoughts on how long it will take to deflate this time around.

Just as an anecdote, I have a friend who lives in Brooklyn Heights. Her husband is in finance (a "bond" guy), and have told his wife (my friend) to sell their apartment there. He sees a major downturn (worse than 2008), and for much longer, and therefore does not want their assets tied to illiquid real estate. Her apartment was sold in 2 days, in cash, above asking price. She also said that a lot of her neighbors have sold as well in the area.

jcguy05 wrote:
We are definitively in a price bubble now, you can mark this post. Small 1100sqf 2BRs in 77 hudson are above 1.5mil and getting sold. Rest 2BRs in highrises are closing in on 1mil.

With the fed rate set to go up starting next year (at the latest), the money supply will dry up, and those prices will not be sustainable.

My advise to existing home owners is to refinance your mortgage to leverage up and take out the max amount of cash allowed using today's property valuation and low rates. Cash will be king again in the next 2-5 years.

You can compare to nyc/brooklyn and point out dtjc is still cheaper, but at near 1mil for 2brs, 600k for 1br, and flat wages. It's just not sustainable growth, the bubble will deflate although slower than 08 as the buyers this time are higher quality not junk, but it will deflate nonetheless.

Get ready for a reality check in 2-3 years.