Signs of an Upswing - Many Condos Drop the Enticements
A great New York Times article. The shift is visible in the Hoboken market.
NEW YORK TIMES
By ANTOINETTE MARTIN
Published: February 25, 2007
There are signs that the residential market slowdown is over — at least for new condominiums, especially if they are near the water. At a number of condo projects, sales are going well enough that buyer incentives like free upgrades or discounted prices are being reduced or eliminated.
“We still like to incentive-ize our buyers,” said Chris Winslow, director of marketing for the northeast at the Tarragon Development Corporation. “We felt the need to retool, though, because of the strength of the market.”
Last month, Tarragon cut two juicy incentives that it had been offering at its Trio condo complex in Palisades Park: a $10,000 credit toward closing costs and a 4 percent discount off list prices.
In downtown Hoboken at Tarragon’s 1100 Adams building, an incentive of up to $9,000 toward closing costs was reduced to $5,000, and as of March 1, buyers will no longer be eligible for a year’s free common charges, Mr. Winslow said.
And in Edgewater, where Tarragon is building a high-rise tower beside the Hudson River called One Hudson Park, all incentives have been removed. The major come-on had been an offer of two years without monthly common charges, which was worth up to $25,000, depending on the size of the apartment.
The Edgewater complex will begin opening for occupancy by summer, and sales have been brisk in recent months, Mr. Winslow said. “We’ve noticed stronger sales at One Hudson Park, Trio and 1100 Adams since about mid-December,” he said.
When sales opened earlier this month at another Edgewater project, Peninsula at City Place, buyers were offered a year’s free common charges. But within 10 days, 20 contracts had been signed, and Savanna Partners, the developer, decided it didn’t need to stimulate sales at the 201-unit converted rental apartment building, said Sean Osher of CORE Marketing, which is handling sales promotion.
“We are not going to continue doing it because we don’t have to,” Mr. Osher said. “We’ve evidently had the good luck of coming to the market at the turn of the upswing.”
Mr. Osher and other market watchers said they could only speculate as to why the residential market is picking up along the Jersey “Gold Coast.”
Some developers and sales agents mentioned the plus-size year-end bonuses handed out to Wall Street financiers as one factor spurring home purchases generally. In addition, the exceedingly tight — and pricey — market in Manhattan may be producing a significant “spillover effect” along the western banks of the Hudson, they said.
Furthermore, the Jersey waterfront has begun to exert its own appeal to people who might be Manhattan-centered, according to Benjamin D. Jogodnik, a senior vice president at the City Living division of Toll Brothers.
“Two or three years ago, all that mattered was that you could get a 40 percent price break coming across to the Jersey side,” Mr. Jogodnik said. “It was all about the price break, and people thought they were compromising to gain dollars and cents.
“Now, with the Hudson County side coming to fruition, builders really delivering and amenities like a 30 percent increase in park space in Hoboken becoming reality, and new retailers coming, people are seeing how neat it all is — and they are showing up in droves at our sales centers,” Mr. Jogodnik said.
For City Living’s latest condo project in Hoboken, the high-end Harborside Lofts now being created in an old warehouse building at the Hudson Tea complex, no incentives are being offered — and yet, as many as 75 home shoppers show up each weekend day, he said. Sales opened last fall, and the 115-unit building is now about 70 percent sold out.
At Maxwell Place in Hoboken, which Toll Brothers is building in partnership with the Pinnacle Companies, Mr. Jogodnik said 300 of 376 units in the second tower have been sold preconstruction.
He and other developers said that distinctive condos at the high end of the scale seem to be the hottest properties right now — even at locations that are not on the waterfront.
In Chatham, Sterling Properties is building a group of 56 town homes with prices starting at $1.225 million. Twelve of 18 units in the first phase of development at the project, which is called Rose Valle, were sold over the last few months.
In Wall, where Franklin Development Group is building Cedar Hollow Estates, a group of 11 condos set in horse country, free upgrades that were worth as much as $100,000 and included an in-home elevator have been eliminated. Interest in the six homes that remain available — all of which offer up to 5,000 square feet and are priced in the $1 million range — is sufficient to warrant this, the developers said this month.
Over all, signals point to the possible end of the housing decline in New Jersey, said Jeffrey
Otteau, who analyzes market data for brokers. December was the first time in 16 months that there was a higher number of homes sold than in the comparable month a year earlier, he recently reported. Sales were up 2 percent, according to Mr. Otteau.
He is compiling comparable figures for January and said he expects sales to be up even more.
Mr. Otteau does not compile separate figures for condo sales. But he said that in Hoboken — where large numbers of condos have been sold in recent years — the pace of sales was up 55 percent in December 2006 over December 2005.
Mr. Osher, the marketer of the Peninsula at City Place in Edgewater, said, “I think we’re seeing a general rising tide,” after 250 brokers and potential buyers attended a party 10 days ago at the opening of sales. “I spoke with brokers from all over the area today, and everyone is saying things are definitely looking up.”
NEW YORK TIMES
By ANTOINETTE MARTIN
Published: February 25, 2007
There are signs that the residential market slowdown is over — at least for new condominiums, especially if they are near the water. At a number of condo projects, sales are going well enough that buyer incentives like free upgrades or discounted prices are being reduced or eliminated.
“We still like to incentive-ize our buyers,” said Chris Winslow, director of marketing for the northeast at the Tarragon Development Corporation. “We felt the need to retool, though, because of the strength of the market.”
Last month, Tarragon cut two juicy incentives that it had been offering at its Trio condo complex in Palisades Park: a $10,000 credit toward closing costs and a 4 percent discount off list prices.
In downtown Hoboken at Tarragon’s 1100 Adams building, an incentive of up to $9,000 toward closing costs was reduced to $5,000, and as of March 1, buyers will no longer be eligible for a year’s free common charges, Mr. Winslow said.
And in Edgewater, where Tarragon is building a high-rise tower beside the Hudson River called One Hudson Park, all incentives have been removed. The major come-on had been an offer of two years without monthly common charges, which was worth up to $25,000, depending on the size of the apartment.
The Edgewater complex will begin opening for occupancy by summer, and sales have been brisk in recent months, Mr. Winslow said. “We’ve noticed stronger sales at One Hudson Park, Trio and 1100 Adams since about mid-December,” he said.
When sales opened earlier this month at another Edgewater project, Peninsula at City Place, buyers were offered a year’s free common charges. But within 10 days, 20 contracts had been signed, and Savanna Partners, the developer, decided it didn’t need to stimulate sales at the 201-unit converted rental apartment building, said Sean Osher of CORE Marketing, which is handling sales promotion.
“We are not going to continue doing it because we don’t have to,” Mr. Osher said. “We’ve evidently had the good luck of coming to the market at the turn of the upswing.”
Mr. Osher and other market watchers said they could only speculate as to why the residential market is picking up along the Jersey “Gold Coast.”
Some developers and sales agents mentioned the plus-size year-end bonuses handed out to Wall Street financiers as one factor spurring home purchases generally. In addition, the exceedingly tight — and pricey — market in Manhattan may be producing a significant “spillover effect” along the western banks of the Hudson, they said.
Furthermore, the Jersey waterfront has begun to exert its own appeal to people who might be Manhattan-centered, according to Benjamin D. Jogodnik, a senior vice president at the City Living division of Toll Brothers.
“Two or three years ago, all that mattered was that you could get a 40 percent price break coming across to the Jersey side,” Mr. Jogodnik said. “It was all about the price break, and people thought they were compromising to gain dollars and cents.
“Now, with the Hudson County side coming to fruition, builders really delivering and amenities like a 30 percent increase in park space in Hoboken becoming reality, and new retailers coming, people are seeing how neat it all is — and they are showing up in droves at our sales centers,” Mr. Jogodnik said.
For City Living’s latest condo project in Hoboken, the high-end Harborside Lofts now being created in an old warehouse building at the Hudson Tea complex, no incentives are being offered — and yet, as many as 75 home shoppers show up each weekend day, he said. Sales opened last fall, and the 115-unit building is now about 70 percent sold out.
At Maxwell Place in Hoboken, which Toll Brothers is building in partnership with the Pinnacle Companies, Mr. Jogodnik said 300 of 376 units in the second tower have been sold preconstruction.
He and other developers said that distinctive condos at the high end of the scale seem to be the hottest properties right now — even at locations that are not on the waterfront.
In Chatham, Sterling Properties is building a group of 56 town homes with prices starting at $1.225 million. Twelve of 18 units in the first phase of development at the project, which is called Rose Valle, were sold over the last few months.
In Wall, where Franklin Development Group is building Cedar Hollow Estates, a group of 11 condos set in horse country, free upgrades that were worth as much as $100,000 and included an in-home elevator have been eliminated. Interest in the six homes that remain available — all of which offer up to 5,000 square feet and are priced in the $1 million range — is sufficient to warrant this, the developers said this month.
Over all, signals point to the possible end of the housing decline in New Jersey, said Jeffrey
Otteau, who analyzes market data for brokers. December was the first time in 16 months that there was a higher number of homes sold than in the comparable month a year earlier, he recently reported. Sales were up 2 percent, according to Mr. Otteau.
He is compiling comparable figures for January and said he expects sales to be up even more.
Mr. Otteau does not compile separate figures for condo sales. But he said that in Hoboken — where large numbers of condos have been sold in recent years — the pace of sales was up 55 percent in December 2006 over December 2005.
Mr. Osher, the marketer of the Peninsula at City Place in Edgewater, said, “I think we’re seeing a general rising tide,” after 250 brokers and potential buyers attended a party 10 days ago at the opening of sales. “I spoke with brokers from all over the area today, and everyone is saying things are definitely looking up.”
Labels: Hoboken Real Estate, Hudson County condo
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