Category Archives: Homes For Sale

Crappy real estate photos kill home values

By coincidence, I was just writing a blog post about the lack of quality photos that suburban realtors show on their web sites, when a realtor friend of mine in Tenafly sent a mass email looking for a way to reuse his listing photos for a virtual tour, which I assume would be part of his online listing.

Selling your home for its highest value is all about marketing and creating a love connection with buyers.  It’s all about the visual experience and creating that WOW  MOMENT!

My question to him is…why would you want to reuse the same exact photos in a virtual tour, that you’re already being use on the same listing page for the typical slideshow? Because it’s cheaper to reuse the photos?

Which photos are more appealing?

Screen Shot 2014-05-03 at 4.04.30 PM Screen Shot 2014-05-03 at 4.04.30 PM - Version 2 Screen Shot 2014-05-03 at 4.04.03 PM Screen Shot 2014-05-03 at 4.04.03 PM - Version 4 Screen Shot 2014-05-03 at 4.03.50 PM - Version 2 Screen Shot 2014-05-03 at 4.03.50 PM

 

 

 

 

 

[The 3 darker photos are of homes for sale (maybe in Tenafly) and were copied from the njmls…and the 3 better photos were enhanced in less than 60 seconds using Apple’s iPhoto ]

Listing photos play an important role in creating a  love connection between your home and  potential home buyers…and agents. If you take the time to create something beautiful to look at,  you’ll grab someones attention.

Great looking photos will increase the value of your home by possibly tens of thousands of dollars…or even hundreds of thousands of dollars. Crappy looking photos will destroy your price

  • First, presenting the same exact photos in a different slide show, on the SAME online page has no added value
  • Second, consumers are smart enough to see when someone’s snookering them.  It’s not a “virtual tour” when you stitch a few photos together and set them in motion.  And considering that we can create something far more exciting on our Apple computer or iPhone using iPhoto in just a few minutes,  today’s buyers won’t be impressed with your typical virtual tour.

Consumers are turned-off by low quality presentations and poorly lit and un-staged room photos.  They expect to see something far sexier than they’re subjected to.

If realtors can’t do better than consumers can on their own, how does that make the realtor look?  Not so good!



Realtors love to say that a picture is worth a thousand words, and it’s true.  However, when the picture looks crappy then it’s worth a thousand negative words.

Buyers don’t get excited viewing crappy looking photos

Awesome looking high resolution photos create excitement and passion. They can also create a memorable impression that keep your listing at the top of someone’s hot list.  And for marketing, a great shot can get someone to take an action…like calling the agent!

Look at the listing photos on some of the great brokerage sites in New York City like Cororan (their enlarged photos are amazing!), Town and CORE (CORE is my favorite)…and then look at any of the lisiting sites in our area.  There’s a HUGE difference in quality…IT SHOWS! These sites and their photography blows away anything that I’ve seen in suburban real estate marketing.

Crappy looking listing photos will decrease the sales price of a home by thousands or hundreds of thousands of dollars…and it will create a longer sales process…which means lower prices.

How about something a little different from the typical realtor shot.  Instagram-like photos have become part of our culture. Why not use it to your advantage.

Before
Before

 

middle effect
middle effect

stairs 3

Sellers and buyers deserve the best quality photos from realtors…anything less should be unacceptable.

[The top photo was taken on my iPhone 5 and then enhanced twice in less than 90 seconds using the app Snapseed]

If agents can’t at the least produce listing photos that are staged and look professionally photographed (enhanced on Photoshop, iPhoto, Aperture or using any of the hundred other photo enhancing programs), then the agent isn’t worth hiring.
If you agent doesn’t care what your home looks like online, then then they won’t care how long it takes to sell your home, and  they won’t care  what it sells for.
The answer to my friend is…
•    Take your own photos and enhance them on the computer or their iPhone, because they’ll look better than what they have been providing.
•    You can purchase a fantastic camera for under $250
•    There are some great photo enhancing apps that are free

 

Disclaimer:  Steven Konefsky is a home builder and does renovations, real estate developer, design consultant, real estate marketing guru, and he sells real estate through Promiment Properties Sotheby’s International in Tenafly NJ, and he sells homes for higher prices than anyone.  If you have any real estate related or marketing questions you can make comments on this blog or Steven can be reached at 201.522.5256 and at Skonefsky@me.com.  FaceTime and Skype video conversations are welcomed 🙂

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Alpine luxury home market continues to tank

When will the luxury housing market begin to recover in Bergen County?

Alpine used to be at the top of the Forbes list as one of the most expensive zip codes in the nation.  I doubt it will be there again if the look at the updated market stats and home sales.

Screen Shot 2014-05-09 at 12.58.04 PM

Ever since the housing market began its recovery in our area about 3 years ago, our once precious and busy luxury market is still in the biggest hole of its lifetime.

The ironic thing is, there are a number of ultra luxury homes that were built by land owners or are presently under construction that cost considerably more than $3 million…but the realtors can’t save their lives to sell a luxury home without a steep discount.

People who are building luxury homes see the value,  yet the realtors don’t.  I kinda like what the consumers are saying because they’re making some huge investments.

The luxury market has taken a huge hit, and the effects are  showing in the prices…it’s devastating and  there’s no end to the bloodbath.

A number of wealthy homeowners have taken their homes off of the market and have opted to wait it out.  I think they’re in for a long wait

Luxury homes

Alpine:

  • There are 32 homes for sale in Alpine priced above $3,000,000
  • In 2013 only 6 homes sold for more than $3 million
  • The highest priced home sold was $13,375,000…which was a 25% discount (originally listed for $18,500,000
  • The second highest priced home that sold was $7,500,000 and was originally listed at $14,900,000 in early 2011…50% discount
  • Of the 6 homes sold…5 were local residents and only 1 was from out of the area (Manhattan)

Going back to the high flying days a 2 acre lot was worth $4 million…for the land only.  Now you can buy a home in Alpine for $4 million and it has a house on it.

Discounts on most of the homes sold in Alpine was 25%.  Most of the homes are dated and need major makeovers which will probably cost another $500k

luxury homes for sale Alpine NJ,alpine, steven konefsky, eating real estyate, prominent properties sothebys international, luxury homes
luxury homes for sale Alpine NJ,alpine, steven konefsky, eating real estyate, prominent properties sothebys international, luxury homes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alpine has several home for sale that have been on the market for 5 years.  

  • One is listed for almost double what the owners paid for the home in 2005
  • Another home was built as a speech home…guess that was a bad investment
  • And one has been ion and off of the market for 4 years and the price keeps increasing…from $9m-$14 million

Bergen County Stats:

  • One-third of the homes for sale in Bergen County are listed for sale in Alpine (32 homes for sale)
  • In 2013 only 28 homes priced above $3 million were sold in all of Bergen County
  • There are 96 homes for sale in BC priced above $3 million

For those of you who have the ability to spend $3 million to purchase a home and then some additional bucks on a renovation, this may be your time.  As a long term investment…maybe, maybe not.  As a place to live and enjoy…yes.

Tell us where you think this end of the market is heading

 

Disclaimer:  Steven Konefsky is a home builder…inc renovations, real estate developer, design consultant, real estate marketing guru, and he sells real estate through Promiment Properties Sotheby’s International in Tenafly NJ.  If you have any real estate related questions you can make comments on this blog or Steven can be reached at 201.522.5256 and at Skonefsky@me.com.  FaceTime and Skype video conversations are welcomed 🙂

Is the most expensive home for sale in US a PR ploy, or can it sell

I guess the luxury home pricing fever that’s been blazing (and selling) in New York City , has finally found its way to the   suburbs surrounding Manhattan.

It was only a matter of time before every who owned the mega of mega mansions let their egos go wild, and try to cash in on the luxury home bonanza.

I caught wind a few days ago that the most expensive home in the United States was just listed in Greenwich Ct for $190 million dollars.

$190 Million Lauder Greenway Estate, Greenwich, CT
$190 Million Lauder Greenway Estate, Greenwich, CT

Sure it’s a big home with lots of rooms, and bathrooms and property, but who in their right mind, or with a large enough wallet will pay $190 million.  And hey, the home comes with all the kitchen and laundry appliances!

I’m not making this up…check out the listing

  • First there’s on;y a few people in the entire world who can afford the price tag
  • And $190 million price tag for a developer to purchase it is even less unlikely, because any way you look at it’s insanely over-priced for a developer

When I along with my father-in-law Gene Heller and Starwood-Heller Enterprises developed Tamcrest Estate in Alpine and Cresskill New Jersey, starting in 2001, we paid $22 million for the undeveloped 54 acre property and we were able to create 34 building sites…seven 2 acre properties and twenty seven 1 acre properties.  Tamcrest Estates became incredibly successful in part because we caught the market at the right time, and the people who had the money were more than happy to put it into their home…in-part because the stock market was out of favor and real estate was seen as a great investment .

The homes at Tamcrest Estates ranged in price from $4 million to $45 million.  But times have changed and these huge suburban homes aren’t seen a great investments, even at dramatically reduced prices (trophy and unique homes may be the exclusion).

From a real estate developers perspective, the $190 million price tag makes absolutely no sense for development potential.  If they really want to go for the gusto, then a better way to approach this would be to subdivide the property and sell off the individual properties.

Additionally, the demographics have changed, as have the mindsets of the super wealthy, who are now dumping their dollars into Manhattan…because Manhattan will always be Manhattan…the mecca for the wealthy.

So with the city on fire, and the mega luxury market in the suburbs simmering, the $190 million Lauder home my be just another publicity stunt to get people to take notice the home and brokerage firm…and that could work, for a few weeks….and on google forever.

$49 million Stone Mansion, Alpine, New Jersey
$49 million Stone Mansion, Alpine, New Jersey

However, if you’re seriously interested in a brand new grand home that is a bargain (recently reduced to $49 million) compared to the Lauder Greenway family estate, there’s an amazing home for sale in Alpine New Jersey named the Stone Mansion …which is part of the former Frick Estate (like the Frick Museum). Alpine has been anointed by Forbes as one of the most expensive zip codes in the Country and is located lust a stones throw from Manhattan.

This home is only one of a number of magnificent estates available for purchase on the grounds of the former Frick Estate…

8 ways Tenafly home sellers and realtors can improve their home appraisal

Screen Shot 2013-04-26 at 11.24.13 AMIf your home is for sale in Tenafly, Cresskill, Alpine, Demarest or in any of the other surrounding towns, then this is a must read for you.  This is an item that every seller and realtor needs to key into and to fully understand.

Here’s a well thought out article I found on Reuters about how to improve your home appraisal…Eight ways to improve you home appraisal

At this time, appraisals are the one item in the sales process that big time affects every buyer and seller.  Every home buyer gets an appraisal, and every seller impatiently waits to hear the results…and sometimes the news is good and sometimes it isn’t.

One of the things that I don’t understand about sellers, and I’ll just touch on it here, is why they don’t have their own appraisal done prior to listing their home.  Not that the appraisal is the true indicator of the value of your home, but the price that the appraiser comes up with is what every lender bases their mortgage loans on…so sellers have to deal with it sooner than later. 

My advice: if you’re looking to sell your home…get an appraisal before you list it.  Then you’ll know approximately what the appraised value is, and this can help you either to price it in that range, or to push the price, and negotiate around it, if the buyers appraisal comes in much lower.  It’s not the end of the world if it’s a low appraisal, but if you already know what that number is, then you can prepare yourself for negotiating your way out of it.

Appraisals are still the biggest stumbling block to selling your home, and realtors love to use the appraisal mess as a way to keep prices lower, because in their mind buying a home is all about price.  But we consumers know that this isn’t true in most cases.

If an appraisal on a home comes back lower than the sales price, and it happens, some sellers end up losing a deal becuse the buyer can’t come up with the percentage difference between the appraisal and the higher sales price. Not that the appraisal is always correct (and that’s why you have to read this article), but it does scare people.

This will begin hurting ssome sales in Tenafly, because sales prices will start rising, especially for homes selling below $1 million. I’ve been complaining for over a year that homes at this price point in Tenafly are being under-priced by up to 10%, but no one would listen, causing home owners to lose substantial money on their sales.

Here’s the article:

By Lou Carlozo

WASHINGTON (Reuters) – When Kellie and Michael May decided to refinance their home in the New York suburbs, they wanted to take advantage of historically low interest rates. But before landing a new 30-year fixed-rate mortgage, they had to get through a home appraisal.

“It was a major stumbling block,” says Kellie May, who has owned the 4-bedroom, 3-bath colonial for seven years. Not that she and her husband were unprepared; they’d been through an appraisal for another refinance in 2010, so they knew to point out improvements they’d made to the 3,400 square foot home, and supply prices for other neighborhood properties that had sold recently.

But the appraisal came back roughly $70,000 less than the $1,230,000 the Mays were expecting, and too low to support their new loan.

They responded with a paperwork arsenal aimed at their lender, asserting that the appraisal had been based on faulty recent sales data. The loan squeaked through, after the bank crafted an exception for the Mays. It was able to do that because their loan was a jumbo loan, not subject to the more rigid underwriting standards they would have encountered if it were a conventional loan aimed at secondary buyers like Fannie Mae and Freddie Mac.

Low appraisals are becoming a bigger problem for many would-be buyers and refinancers as home values have started to stabilize and rise in some markets.

In Leesburg, Florida, for example, low appraisals have caused the cancellation of as many as 15 percent of home sales for local real estate broker Gus Grizzard.

“We are seeing higher price appreciation and are starting to run into appraisal problems,” said Charlie Young, chief executive officer of ERA Franchise Systems, a firm with a national network of real estate brokerage offices, including Grizzard’s. The National Association of Realtors reported on Tuesday that inventories of homes were low and the median price a home resale was, at $180,800 in December, up 11.5 percent in a year.

Appraisals are based on recent sales prices of comparable properties. And in rising price markets, those sales prices might not be high enough to support the newest deals. Young said there were many places in California reporting appraisal problems.

On Friday, the federal government issued new rules aimed at improving the appraisal process as it pertains to high-interest mortgages on rapidly appreciating homes.

But those rules don’t go into effect for a year, and don’t apply to most conventional loans. It pays to protect your own loan before the bank even thinks about sending that guy with the clipboard over to your house.

“The reality is that the appraiser is only there for 30 minutes at most,” says Brian Coester, chief executive of CoesterVMS, a nationwide appraisal management company based in Rockville, Maryland. “The best thing a homeowner can do to get the highest appraisal possible is make sure they have all the important features of the home readily available for the appraiser.”

Here are eight ways you can bolster your appraisal:

MAKE SURE APPRAISER KNOWS YOUR NEIGHBORHOOD

Is the appraiser from within a 10-mile radius of your property? “This is one of the first questions you should ask the appraiser,” says Ben Salem, a real estate agent with Rodeo Realty in Beverly Hills, California.

He recalled a recent case where an appraiser visited an unfamiliar property in nearby Orange County and produced an appraisal that Salem said was $150,000 off. “If the appraiser doesn’t know the area intimately, chances are the appraisal will not come back close to what a property is really worth.”

You can request that your lender send a local appraiser; if that still doesn’t happen, supply as much information as you can about the quality of your neighborhood.

PROVIDE YOUR OWN COMPARABLES

Provide your appraiser with at least three solid and well-priced comparable properties. You will save her some work, and insure that she is getting price information from homes that really are similar to yours.

Websites including Realtor.com, Zillow and Trulia offer recent sales prices and details such as the number of bedrooms and bathrooms in a home.

KNOW WHAT ADDS THE MOST VALUE

If you’re going to do minor renovations, start with your kitchen and bathrooms, says G. Stacy Sirmans, a professor of real estate at Florida State University. He reviewed 150 variables that affect home values for a study sponsored by the National Association of Realtors. Wood floors, landscaping and an enclosed garage can also drive up appraisals.

DOCUMENT YOUR FIX-UPS

If you’ve put money into the house, prove it, says Salem.

“Before-and-after photos, along with a well-defined spreadsheet of what was spent on each renovation, should persuade an appraiser to turn in a number that far exceeds what he or she first called out.”

Don’t forget to highlight all-important structural improvements to electrical systems, heating and cooling systems – which are harder to see, but can dramatically boost an appraisal. Show receipts.

TALK UP YOUR TOWN

If your town has recently seen exciting developments, such as upscale restaurants, museums, parks or other amenities, make sure your appraiser knows about them, says Craig Silverman, principal and chief appraiser at Silverman & Co. in Newtown, Pennsylvania.

DISTINGUISH BETWEEN UPSTAIRS AND DOWNSTAIRS

Many homeowners covet that refinished basement, but that doesn’t mean appraisers look at it the same way. “Improvements and additions made below grade, such as a finished basement, do not add to the overall square footage of your house,” says John Walsh, president of Total Mortgage Services in New York. “So they don’t add anywhere near as much value as improvements made above grade.”

According to Remodeling magazine, a basement renovation that cost $63,000 in 2011-12 will recoup roughly 66 percent of that in added home value. That’s not as good as an attic bedroom, which will recoup 73 percent of its cost. Even similar bedrooms typically count for more if they are upstairs instead of downstairs.

CLEAN UP

Even jaded appraisers can be swayed by a good looking yard. “Tree trimming, cleaning up, a few flowers in the flower beds and paint touch up can all help the appraisal,” says Agnes Huff, a real estate investor based in Los Angeles.

That advice holds true indoors, too. “Get rid of all the clutter in your home,” says Jonathan Miller, a longtime appraiser in New York. “It makes the home appear larger.”

GIVE THE APPRAISER SOME SPACE

Don’t follow the appraiser around like a puppy. “I can’t tell you how many homeowners or listing agents follow me around in my personal space during the inspection,” he says. “It’s a major red flag there is a problem with the home.”

And while you’re at it, make the appraiser’s job as pleasant as possible by giving your home a pleasant smell. At a minimum, clean out the litter box. Baking some fresh cookies and offering him one or two probably won’t sway your appraisal, nor should it. But it couldn’t hurt.

(The writer is a Reuters contributor. The opinions expressed are his own.)

(Follow us @ReutersMoney or at http://www.reuters.com/finance/personal-finance; Editing by Linda Stern and Tim Dobbyn)

Why real estate marketing sucks

This beautiful home has a FLR, FDR, FR W/FPL, MEIK, MBR…is it a wonder why homes take so long to sell, and why they always sell for less than they should

If you know me, or have been reading my blog, then you know that I hate real estate marketing.

A listing isn’t marketing.  It’s just a listing.

It’s the same exact listing as all of the millions of other homes listed on all of these free real estate web sites.  And not that it matters that there are millions of other homes that are listed, because your only concern needs to be how your home stands out from the crowd…in your local market.

Realtors like to hype that your home is out there for millions of buyers to see.  But that’s the biggest fallacy out there.  It’s really a bunch of bulls*%t.

The fact is, at any given time, there’s not all that many people who are looking to buy a home in Tenafly, or for that matter in Cresskill, Alpine, Closter or Englewood.

That’s why it’s so important to make your home stand out from the crowd!

Tenafly had 150+ home sales in 2011, and it’ll be close to the same this year.  So how many people at any given time are considering to buy a home in Tenafly.  And those who are, are also looking at other towns as well.  And when you start breaking the formula down by price ranges, then the numbers dramatically decrease for each price niche.

So maybe there’s a few hundred people at best who are considering various price ranges in Tenafly, throughout the entire year!

Now to my point of why I hate real estate marketing.

Read this:

PRIME LOCATION! FABULOUS EXPANDED,RENOVATED COLONIAL W/OPEN FLOOR PLAN FOR ENTERTAINING…….

This is the opening line for a home that is for sale in the Tenafly area.

What the hell is it?

  • What are they trying to sell?
  • What are they trying to convey? Is it a catering hall?  Can’t you entertain you friends in every size home?
  • Do people get excited that you can entertain, and is it their most important concern when looking to buy a home…is it even in the top 5 concerns?  In 35 years of building homes and condos etc. entertaining people has never been a topic of concer with any of my buyers.  Ever!

Don’t Realtors ever read Architectural Digest, or any of the other home magazines?  I guess not.
Because, if they did then they would see that it’s not all about the pictures.  Pictures are important, but it’s the story that starts the sales process, creates interest and starts the love connection.

“Nina Garcia has had to do quite a bit more than click her vertiginous Tom Ford heels to make herself feel at home.” …first line of an AD story-line

Without a compelling story you have nothing for marketing.

It’s all about the story!!

To just list the rooms by name and include a few items the the most idiotic way to make your home stand out from the crowd.

And to say…”it’s a must see” is even dumber.

No it’s not a must see.There’s no shortage of homes for sale in Tenafly, so no one has to see this home.

Selling homes is now all about telling viewers, (who most you’ll never talk to…or will ever see your home) why they should drop everything that they’re busy with, and take a trip to see your home

It’s a Realtors job to convince someone to see it.  And if that agent doesn’t have the ability to attract buyers, that agent has no value.  Trying it the old way will cause your home to remain unsold for a longer period of time, and it will decrease the value of your home at the same time.

And it’s something that doesn’t need to happen.

Selling your home is all about marketing, and making your home stand out from the crowd.

If you want your home to get noticed faster, sold faster and sold for it’s highest price, then email me at snkonefsky@gmail.com.  It doesn’t take a rocket scientist to figure this out…so why isn’t anyone doing it!

It’s all about the story…check out these articles:

Forbes…Tell To Win Book Review

Arianna Huffington…Why Peter Guber’s book Tell To Win is a Game Changer

New Range Rover U.S. debut tonight at Stone Mansion in Alpine

Range Rover is making its U.S. debut tonight at a special event at the magnificent $56 million Stone Mansion that is listed for sale in Alpine, New Jersey.

The all new Range Rover

This is one way to draw a crowd…and to try to sell a home.

Guess they’re hoping that someone at the event is chummy with a billionaire, who can be enticed to buy this incredible home.

It’s good word of mouth marketing.

I wonder if a few local agent will try to crash the party just to give out some business cards.

Maybe there will even be a fly-over with someone tossing their cards from a helicopter.

It’s rumored that Jay-Z and Beyonce will be in attendance, as well as some our local pro sports players and other celebrities.

You may want to drive by the entrance on Closter Dock Road, to catch a glimpse of the stars…and the car

The paparazzi will be out in Alpine tonight!

Check it out!

Read about the new Range Rover

Closter home sales stats 2012

Believe it or not,  home sales in Closter are on a roll in 2012.

  • Home sales increased 12% in 2012 from 49 home sales in 2011 to 55 home sales for the same period in 2012
2012 home sales stats…Closter, New Jersey

But what’s a bit of a drag on the number of sales, is the decrease of the the dollar volume of sales and the average price of those sales:

  • the dollar volume of sales is down 8%
  • and the average sales price decreased by 18%

We’ll get into the numbers and why all of this is happening in a future post.

But remember one thing when you’re looking to buy or sell a home…you need to analyze and understand all of the facts.  It’s one thing to believe that a specific town is doing great because of the number of homes sold, but when you take a closer look at the numbers, it may not be even close to the hype.

Buyer beware:  Know the facts before you do anything.

Bergen County home sales have increased every month in 2012

For those of you who like to understand what’s really going on with the housing market in Bergen County, here’s some data for you to sink your teeth into.

For the 6th straight month in 2012 single family home sales has increased.  Yes increased.

It’s time for every homeowner and seller to finally celebrate.  The housing market is on a roll in Bergen County.  Though the increase is not a all price points in every town the market has turned for the better.  No, we’re not going back to anywhere near the pace of the high flying days, or to those lofty prices…but the market has stabilized (which it has been for several years, if anyone cared to look at the data).

Wi8th the exception of January 2012 for multi-family home sales, every month in all categories has seen an increase in home sales.

Tell me that’s not great!

In fact, in 2012 we have not seen one month where home sales have decreased.

  • The number of home sales in 2012 has increased by 11% over the same time period in 2011
  • The dollar volume for home sales also increased by 7% over 2011
  • The average price for the homes sold decreased by 4%, but that was all due to sluggish sales at the luxury end of the market, where for some bizarre reason 2011 was an incredible year for the luxury market…but now it’s cooled

Though home sales are way below the volume set during the peak years of 2011-2005, Bergen County has experienced a steady market for sales…given this new economy.

The market for multi-family home sales is equally impressive for 2012:

  • The number of units sold increased 14%
  • And the sales volume increased by 7%
  • The average sales price fell by 6%. but is due to a lack of inventory at the upper sales range, and we had in the past.  Over time these units will invr5ease in vale because they’re newer and priced at a point that is more desirable to today’s buyers…either first time buyers or move down buyers

This is the new market. This is our new reality

No matter what happens, the number of home sales will not increase…even if Realtors continue to push sellers to cut their prices. More buyers are not coming into the market.  And with the rise of new multi family construction, the rental market will take a huge bite out of future home sales.

We have experienced 5 years of incredibly discounted prices, and historically low interest rates, and the data proves that lower prices have not increased the volume of home sales in Bergen County. And if you have been a reader of my blog, the data also points to the same facts for Tenafly, Cresskill, Closter or other towns.

Lower price do not create sales.

Check out my other posts to see what’s happening with home sales for Tenafly, Alpine, Cresskill and other towns.

Stay tuned…more to come.

Are home sales more important to the economy, than dealing with underwater homes?

Some may consider me a pessimist, but I’m not.  I’m just a realist when it comes to analyzing the housing market

I was looking through some of my housing data just now, and something hit, that I really haven’t paid much attention to…the tremendous loss of real estate values (homes for this post) that we have all suffered ($6-$7 trillion), and what effect will this have on home sales and the economy going forward.

Everyone in the media and real estate brokerage is focusing on a new theme of affordability, yet there is very little being said that affordability isn’t anywhere close to being a solution to the market crisis that still looms over every one of us…not just sellers.

Almost everyone who has purchased a home since 2002 has lost money, and some have lost  And that holds true even for homes purchased today. 

Since 2001 almost 100,000 homes (single and multi-family) have been sold, and every one of those homes have lost value…and a major percentage of these homes are underwater.  And this is just for the homes sold.

This table not only represent Bergen County home sales, but more importantly it represents the number of people who have purchased homes since 2001, and who have lost money on the homes they purchased…and that’s almost every sale on this chart! And this chart is only for homes sold below $2 million.

The Wall Street Journal and a few other media outlets have started writing about this issue, because they’re starting to see the light.

This is a huge issue.  Underwater homes are the reason why the housing inventory is so low…homeowners simply can’t sell their homes for less than they’re worth, because they don’t have the money to make up the difference between the two amounts.

So it’s great news that prices are rising, and inventories are low, but this is only a temporary thing.  It won’t last.  There is a difference between the current low inventories of homes that are for sale…and for those homeowners who either want to sell their homes or have to, but can’t because their values are underwater.  And this inventory is the killer that’s lurking right in front of us, but is being ignored.

I love how the media has picked the side of the home buyer and affordability to write about, and miss a much larger problem that needs to be dealt with, before a recovery can take place…namely those who own homes and can’t sell them.  A recovery can’t happen until the underwater problem is resolved.  The problem won’t magically disappear.

What effects will this have for our local home markets in Tenafly, Alpine, Cress,kill and Haworth?  We’ll soon see.

Another blow to the housing market

A refreshing look at the housing market and what makes it tick.  The future will be nothing like the past, so it’s time to stop dreaming of the past, and start seeing the new reality…and start changing the suburbs, so they thrive, rather than fail.

Towns like Tenafly, Cresskill, Englewood, and Alpine New Jersey need to begin looking at the future of their communities, because as of now they have neglected to do so, and things are only going to get worse.

What are they waiting for

As if the housing market didn’t have enough problems, here’s one more to add to the pile: Student loan debt

Move up buyers make only a small portion of today’s home buyers…so how will towns like Tenafly attract new buyers over the next decade

As an article in today’s New York Times points out…Report details woes of student loan deb…

outstanding student loan debt has risen to more than $1 trillion.

The housing market in Tenafly, Cresskill, Alpine…and everywhere else will start feeling the pinch.  DFor those who get a jump on it and start creating a new type of suburb will prosper.  Those that don’t…well they’ll just fail

For first time buyers who make up a majority of today’s home buyers, this is a killer, because how will they raise the down payments necessary to qualify for a mortgage.  And what’s even worse, many of these loans were “subprime styled loans” made to people who really couldn’t afford to pay them back.

This is another part of a massive problem that will affect home sales going forward.

But just because this affects home sales doesn’t mean it’s all bad news. When people can’t afford to buy a home, then they have little choice but to rent something…and this is a major incentive for developers, and investors who build and own apartment projects.

I realize that home sales are an important part of our economy, but all is not doom when people rent apartments rather than purchase homes.

This is one of many reasons why I believe that suburban communities need to revitalize their communities to attract a new generation of residents…not just first time buyers…but all buyers and renters.

As people flee the burbs for less expensive housing and taxes, communities are left with little choice but to adapt to a new need.  We simply don’t need the burbs like we used to.

Let me know what you think