Nathan Colmer | Van Dyk Group
C: 609.290.4293 | O: 609.492.1511
The Long Beach Island real estate market offers buyers some excellent opportunities and the LBI real estate market has remained strong even in this economic downturn. Buying opportunities still exist on LBI for several reason:
Buying real estate on Long Beach Island, like buying any investment, comes down to timing and price. With the available inventory and some patience, a buyer can purchase a great property for a great price and still be in a strong financial position.
Buying a home in the LBI real estate market offers some exciting opportunities Apart from the obvious enjoyment of owning a beach house, the LBI real estate market serves as an excellent investment with income generated from both long term appreciation, summer vacation rentals or even by building a new home in the LBI real estate market.
Most economists would agree that 2006 was the height of the real estate market on LBI and elsewhere around the country. For the year 2005-2006, 451 single family homes sold in the LBI real estate market with an average sale price of about $1,121,000. Homes sold in an average of 116 days. In 2010 and 2011, the average sale price was about $1,015,000 and $950,000 respectively. Homes on LBI did sell slower with an average of about 175 days on the market. Using these averages as a baseline, we can see that homes prices have indeed fallen when compared to the height of the market, but that the decrease in the average sale price on LBI is far less than other markets around the country. 2012 showed renewed strength with 373 homes selling with an average price of $939,000. This is particularly encouraging when we consider that two months of the 2012 real estate market were all but lost to Hurricane Sandy! 2013 suffered from Hurricane Sandy as the LBI real estate market got off to a slower start but as Sandy faded to memory and the rebuilding of Long Beach Island began making strides, the market too increased. 2014 and 2015 both showed very positive home sale numbers with 2015 being one of the best years on record up to that time. Both the number of homes sold and the average sale price have substantially increased. Home sales on LBI have been seeing a steady increase adding to the argument that the LBI NJ real estate market makes a smart investment. More recently, the LBI real estate market has been seeing steady and stable growth. New construction has been taking place all over LBI which helps to improve property values in all facets of the market.
The LBI Real Estate Market : Foreclosures and Bank Properties on LBI
The LBI real estate market has, when compared to other national markets, a very low number of bank properties and foreclosures. Bank involvement in a sale in the LBI real estate market can be broken into the following categories::
The lower number of foreclosures has helped to keep the LBI real estate market strong. Without the glut of bank inventory to drag down the market, sale prices have remained rather stable. If you would like, you can view a list of all bank properties and foreclosures on LBI by visiting my page dedicated to short sales, bank owned properties and foreclosures.
The LBI Real Estate Market : Why LBI Real Estate Makes a Good Investment
The LBI real estate market has shown dramatic improvement over the past decade. While of course past results cannot ensure future performance, it is encouraging to note that this improvement has been realized even in one of the worst economic downturns in our nations history! Below are the average, approximate sale prices of single family homes on LBI from 2000 through last year. Note that 2013 showed an artificially lower since it includes storm damaged homes which were sold as vacant land rather than single family homes:
From an investment standpoint, this data reflects only the average increase and decrease of LBI real estate's value and does not take into consideration carrying costs or any rental money that could have been earned over these years. It also does not take into account all the fun and memories made from owning a beach house!
Read about the Long Beach Island area including a brief history of the community and the pros and cons of each area.
There are many forms of ownership in the LBI real estate market. Buyers can choose from single family homes, duplexes, condos, vacant land, storm damaged homes and even interval ownership (similar to a timeshare). Read about the different forms of ownership on Long Beach Island.
There are several distinct locations in the LBI real estate market and it is important that a buyer understand the difference between them. The most commonly recognized locations are: Oceanfront, Oceanblock, Oceanside, Bayside, Bayblock, Bayfront and Lagoonfront. You can read more about each location below.
Flood insurance is an important topic for all Long Beach Island real estate buyers to understand. The costs of flood insurance are expected to rise and while the majority of homes on LBI will see manageable expenses, there are many that will not. Having an understanding of flood insurance and the LBI real estate market is essential before making any investment in the area.
Hurricane Sandy was a significant event in the history of Long Beach Island. While it was several years ago, it is still an important concept to understand when buying a home on LBI. Hurricane Sandy called to the fore front questions about flood insurance, house raising and the risk of future storms.
Building a new house in the LBI real estate is...by far...the best investment you can make on Long Beach Island. I specialize in this kind of transaction and the average project sees between 25% and 30% immediate equity in the finished project. This can be a great way to hedge against market turns or end up with a "better" house than your budget would normally afford.
Summer rentals are an important part of the Long Beach Island economy. It is important for a buyer to understand the rental process and the income potential when investing in the LBI NJ real estate market.
Before any purchase is considered it is important for a buyer to have an understanding of the general process and how real estate agents represent their clients in the Long Beach Island real estate market.
Hurricane Sandy has had a significant impact on the Long Beach Island NJ real estate market. As a whole, the LBI real estate market faired very well through the storm and while there was substantial damage to many homes on Long Beach Island, the LBI area has made an excellent recovery and prices have remained steady in the wake of the storm. While there are many homes now on the market for a much lower price than prior to Hurricane Sandy, these lower prices are reflective of the home's condition rather than a depreciation in the LBI real estate market.
Opportunities exist for buyers of storm damaged homes in that they are able to purchase at or near land value often leaving a substantial budget for new construction or renovation of the existing home.
Flood insurance is a complicated issue in the LBI real estate market and one which requires a complete understanding prior to buying any home. There are several metrics that are used to determine the cost of flood insurance and even homes that are elevated high on pilings can still be at risk of high costs. Read the basics of flood insurance on Long Beach Island and learn how it impacts buying a home.