Thursday, June 22, 2006

More On Hovnanian's Jersey City Development

Update on the Hovnanian/Equity Residential development in Jersey City.

From the Record/Herald:

The two towers
By HUGH R. MORLEY

Two 500-foot towers with 901 housing units will rise above the Jersey City waterfront as a more affordable alternative to Manhattan, two developers announced Wednesday.

Red Bank's K. Hovnanian and Chicago-based Equity Residential said they each will build a tower on a 1.76-acre parcel bought from Hartz Mountain Industries of Secaucus for $70 million.

The two will target different markets. Hovnanian will build 420 condominiums, mostly one- and two-bedroom apartments. At the lower end, studios are expected to sell for $300,000. And a small number of penthouses will go for $2 million.

Equity Residential's tower will contain 481 apartments. Studios will likely rent for upward of $1,900 and two-bedroom units will probably go for more than $3,000, the company said.

The towers are scheduled to be completed in spring 2009.
...
Still, there is plenty of local competition for buyers. Just a few blocks away, Donald Trump is building more than 850 up-market units in two towers.

Farther north along the coast, Hovnanian this weekend will begin selling 268 loft apartments and 68 town houses that the company is building in West New York, among several other projects under construction on the waterfront.

Scott Selleck, a broker at NJ Gold Coast Real Estate in West New York, noted that the Montgomery Green condominiums nearby has yet to sell out.

"It's a risky situation," he said. "There is a possibility of oversupply. It may be difficult to move those condos."

He said there is a big demand for rental units in that area, however.

44 Comments:

Blogger X-Underwriter said...

At the lower end, studios are expected to sell for $300,000.

That sounds low end to me!!!!

With 20% down and a 7.00% mortgage, that would make it $1,555/mo plus taxes plus (probably) high HOA fees

Who the f*ck is going to buy all these?

6/22/2006 02:39:00 PM  
Anonymous Anonymous said...

Down a desolate highway
Blowing dust in my hair
Warm smell of diesel fuel
Blowing around in the air

Up ahead in the distance
I saw an amazing sight
The desert filling with a million new homes
Springing up overnight

To a young couple in the show model doorway
I heard the Realtor tell
If you can’t pay in a year or two
You could always sell

Then she lit up a smile
And she showed them the way
How to sign on the dotted line
Now they can really say

Now at last we finally get to own one
In this desert place
In this really hot place (background)
In this scorching place
At least we finally get to own one
But my well paying job
But my well paying job (background)
Is 100 miles from here

They got their ARM loan twisted
By their mortgage guy
Now that they’ve found that they’re upside-down
It’s impossible to refi

Now they sit in their backyard
Soaking in their sweat
Their electric bill is way too high
And they’re too far in debt.

So they called up their agent
Please put up your sign
She said
We haven’t had this much inventory since 1989.

And every month those bills push them closer to judgment day
Toss and turn in the middle of the night
But they just can’t pay

Commuting two hours just so we could own one.
Such a faraway place
Such a lonely place (background)
Such a scorching place
Working two jobs just to be able to afford one.
What a long drive
What a terrible drive(background)
So much gas to buy

Since their ARM has no ceiling
Called Mom and Dad on the phone
And they said
We need to borrow another twenty grand
Just another small loan.

And in his manager’s office
He checked the balance sheet
The numbers no longer added up
So layoffs begin next week

Last thing I remember
I pushed them out the door
I told them they should go back to renting just like they were before

Relax said the Agent
We are programmed to deceive
You take out a loan any time you like
But you’ll never be free

6/22/2006 02:44:00 PM  
Blogger grim said...

Anyone else here think that the buildings will both turn rental?

That is, if the project is completed..

jb

6/22/2006 02:45:00 PM  
Blogger Mr. Oliver said...

$300k for a "low-end" studio in Jersey City?

6/22/2006 02:50:00 PM  
Blogger Richie said...

Everyone wants to live there.

They should throw in a 'bullet-proof vest' incentive.

6/22/2006 02:52:00 PM  
Blogger grim said...

So they called up their agent
Please put up your sign
She said
We haven’t had this much inventory since 1989.


I'm not sure if I should laugh or cry. I want to laugh, but I know, deep down, that crying is probably more appropriate.

grim

6/22/2006 02:55:00 PM  
Anonymous Anonymous said...

3:44 - that's weirdly funny.

The music playing in my head when I read that made my skin crawl.

I'm not even looking on the MLS this weekend now after that. I'm gonna do something safe like skydiving.

Pat

6/22/2006 03:03:00 PM  
Blogger grim said...

From the AP:

Mortgage Rates Climb on Fed Rate Worries

Mortgage rates rose this week with 30-year mortgages climbing to the highest level in more than four years on investor fears about inflation.

Freddie Mac, the mortgage company, reported Thursday that rates on 30-year, fixed-rate mortgages rose to a nationwide average of 6.71 percent, up from 6.63 percent last week.

It was the highest level for 30-year mortgages since they averaged 6.76 the week of May 31, 2002.
...
Rates on 15-year, fixed-rate mortgages, a popular choice for refinancing, increased this week to 6.36 percent, up from 6.25 percent last week.

Rates on one-year adjustable rate mortgages rose to 5.75 percent, up from 5.66 percent last week and the highest level since one-year ARMs averaged 5.77 percent the week of Aug. 3, 2001.

Rates on five-year adjustable-rate mortgages climbed to 6.32 percent, up from 6.23 percent last week.
...
A year ago, 30-year mortgages averaged 5.57 percent, 15-year mortgages stood at 5.16 percent, one-year ARMs were at 4.23 percent and five-year ARMs averaged 5.05 percent.

6/22/2006 03:04:00 PM  
Anonymous Anonymous said...

Rates on 20 year up over 20% in last 12 months!!!

Here that greedy money grubbing sellers!

No Bids No Visists No Notting!

Misery index climbing!

Babababababa

BOOOOOOOOOOYcott Houses

30% lower from peak 2005 prices then Bid visit buy!

Babababa
Bob

6/22/2006 03:15:00 PM  
Anonymous maryannenj said...

It's a risky situation," he said. "There is a possibility of oversupply. It may be difficult to move those condos."


YA' THINK???

6/22/2006 03:24:00 PM  
Anonymous Anonymous said...

There is no way all those condos are going to sell. What are these people thinking? This housing market is getting ready for a nasty, nasty fall. Proabley worse fall you will ever see, especially in NJ. There are alot of people whom are literally going to lose everything when the smoke finally clears. Glad I am renting...whew, boy I can sleep good at night.

People use to laugh at me, lecture me, joke about me because I rented. There were times I even got depressed that I was a renter and couldn't afford to buy a home.

I guess good things really do come to those who wait, because I didn't sell my soul to the bank, and I am not hoping and counting on the "real estate only goes up" bullshit.

If you don't fully own your home or don't have at least 30% equity built up in it. Say goodnight sweetheart....because the piper is a coming.......

6/22/2006 04:08:00 PM  
Anonymous Anonymous said...

Yes, please take my $600k so I can live in Jersey City! Great idea!

6/22/2006 04:49:00 PM  
Anonymous Anonymous said...

I'd live in Union City first before Jersey City. Jersey City use to be the alternative to Hoboken, but just wait--Hoboken will go down with the rest of it!

6/22/2006 05:35:00 PM  
Anonymous Anonymous said...

why union city? heard its crappier that JC

6/22/2006 06:17:00 PM  
Anonymous Anonymous said...

Union City can only go one way--up!

6/22/2006 06:56:00 PM  
Anonymous Anonymous said...

why don't you live in jc heights then? Do you think that will move up too?

6/22/2006 07:35:00 PM  
Anonymous Anonymous said...

{{{Who the f*ck is going to buy all these?}}}

All the 25 year old trutafarians & E Millionairs you see in Manhattan.
Somehow everyone has $3,000 - $6,000 to spend on monthly housing costs all around the NYC Metro area, but you never find out exactly what they do.

The same type of person who spends $300 every few days on Jeans & $15 a day at Starbucks will pay whatever is asked because it is 'so close to NYC... And the NY Times & NY Magazine will have their report on how it is such a 'hot & trendy nabe' along with the model White Male / Asian Female couple.

I ask this: Is their ANY housing for sale within 150 miles of Manhattan for someone making LESS than $100,000 a year as a single person??
Or does everyone (like NY Magazine & the NY Times) make $250,000 a year or more and spend up to $10,000 a month on housing expenses???

6/22/2006 08:16:00 PM  
Anonymous Anonymous said...

{{why don't you live in jc heights then? Do you think that will move up too?}}

You are too late for JC Heights. Shitty single family homes go for over $600,000. One bedroom condos start at 'only' $400,000 with god knows how much in HOA fees & Taxes

6/22/2006 08:17:00 PM  
Anonymous Anonymous said...

Anon 9:16:
Sure, if you're lookin at that many miles away.

Like Mercer County area. Lawrenceville is really nice:
http://tinyurl.com/create.php

I know for a fact that one would prolly go for 209.

The commute is about 60 miles, there's an express train from Hamilton station.

There are a lot of properties for you if you are willing to commute.

Go to mapquest and do a 50 or 60 mile radius from Penn Station.

Pick some towns, and come back.

Tell the name of the town, and someone will give you the low-down here.

Pat

6/22/2006 08:57:00 PM  
Anonymous Anonymous said...

{{{Sure, if you're lookin at that many miles away.

Like Mercer County area. Lawrenceville is really nice:
http://tinyurl.com/create.php

I know for a fact that one would prolly go for 209.

The commute is about 60 miles, there's an express train from Hamilton station.}}

That $209,000 is likely a tiny Piece of Shit that would qualify as a teardown.

What is the point?? You are still paying sky high property taxes + hundreds of dollars a month in commuting costs.

NJ & NY are losing population or the middle class of people who have a family income of less than $150,000 a year and want to spend less than $5,000 a month on housing costs to live within 1 hour of Mahattan.

6/22/2006 09:29:00 PM  
Anonymous Anonymous said...

Geesh. If you don't really want the honest info, don't ask. That place is only about ten years old, and for a single person, would be ideal. I know several people who live there and say it was well made, although no garage.

Pat

6/22/2006 09:32:00 PM  
Anonymous Anonymous said...

Here was the url for that "teardown" as you called it:
MLS# 4740465
http://tinyurl.com/lvxn6

Pat

6/22/2006 09:46:00 PM  
Anonymous Anonymous said...

another company hits the road
TeamStaff moves to Atlanta from
Somerset.

They say because of Geographic
changes.Right, their moving
because of unfriendly New Jersey.

6/23/2006 06:39:00 AM  
Blogger minutesfromNYC said...

Sorry, but anyone who pays 300k to live in a studio really needs to drink a warm cup of bleach

6/23/2006 06:53:00 AM  
Blogger NJGal said...

Welcome back $300 jeans man!

6/23/2006 07:53:00 AM  
Anonymous Anonymous said...

Sorry, but anyone who pays 300k to live in a studio really needs to drink a warm cup of bleach

That is cheap & average for most of Hudson & Bergen County.

What about these ridiculous rents of close to $2,000 for a small one bedroom, or these ridiculous things you must do before you sign a lease such as :

1) Brokers fee of 15% of annual rent which is now standard in Hudson county.

2) Prepaying entire years lease if you don't have a 750+ FICO score.

3) Assuming your rent will rise 10% or more a year because they can always rent to another recent grad who will pay $2,500 + for a studio in Hoboken or JC.

6/23/2006 08:25:00 AM  
Blogger minutesfromNYC said...

That is cheap & average for most of Hudson & Bergen County.


You call that cheap?? LOL

300k to wake up in your bathroom/kitchen/livingroom/bedroom?

Oh, go and invite some friends over. We can all sit on your bed

It is considered "cheap and average" because the 20-something herd mentality is willing to pay such an absurd price tag...for what? To live in Jersey City??? Give me a break. They probably can spend better money figuring out the "secrets to true internet wealth"
hahha

6/23/2006 10:35:00 AM  
Anonymous Anonymous said...

{{It is considered "cheap and average" because the 20-something herd mentality is willing to pay such an absurd price tag...for what? To live in Jersey City??? Give me a break. They probably can spend better money figuring out the "secrets to true internet wealth"
hahha }}

This is the group that spends thousands on clothes who must buy premium denim @ $300 a pair, not to mention the thousands spent on rent or housing related PITI in Manhattan or the 'other 4 boros'

The only thing that matters is how trendy the neighborhood is since life is all about partying and shopping.

6/23/2006 11:44:00 AM  
Anonymous Anonymous said...

I lived in JC for the better part of 5 years. My commute to WTC was 15 min door to door..The reason why we moved out was because we owned an apt and we saw all of the new development going on we had just had a kid and we were worried that if we didn't move in the next year that we would never be able to sell. The competition would be too great for our place. Our taxes were nothing 1200 a year and the neighborhood is going through a transformation.. However, The schools are awful and you can walk one block and it be beautiful and the next block you will see people throwing thier food on the ground like it was a garbage can. I can see it being a 6th boro in 10 to 15 years..We lived off of CC Drive and just a year ago we witnessed 30 people outside fighting and repeatdly beating one man unti they left him for dead ..Atthat time I had to phone my husband to take the back way or he would have walked right into the middle of it..

6/23/2006 12:14:00 PM  
Blogger minutesfromNYC said...

The only thing that matters is how trendy the neighborhood is since life is all about partying and shopping.

I blame MTV for this mentality

6/23/2006 12:50:00 PM  
Anonymous Anonymous said...

I live over by columbus, too. My neighborhood is nice but a couple blocks away it is a tad bit ghetto. Jersey City is great for single people, or DINKS but forget about children. It really is not yet a good place to raise kids. That said I am young and live downtown and it is a nice place to live and getting better that said. If a person could buy a nice 1 bedroom 700sqft for around 250-300k that would be very good. There will be an adjustment but it woun't be as severe as many think because salaries are pretty good on wall st. and wall st. west. Seeing as how this is financial services country and most people living there work on Wall Street. Wall Street where entry level salaries have been averaging 90k, so 30k a year in housing costs for a single person is not unreasonable. Until areas close to NYC or NYC itself goes down in cost this area is very attractive. That being said I pay 2k a month but have 1200sqft 2 bed rooms.

6/23/2006 02:10:00 PM  
Blogger chicagofinance said...

Anon 3:10PM:

Ever live through a Wall Street drought?

:-[

6/23/2006 02:45:00 PM  
Anonymous Anonymous said...

{{{Wall Street where entry level salaries have been averaging 90k, so 30k a year in housing costs for a single person is not unreasonable. Until areas close to NYC or NYC itself goes down in cost this area is very attractive. That being said I pay 2k a month but have 1200sqft 2 bed rooms.}}}

$90,000 for a single person is not enough to buy anything in Jersey City or in the 5 boros at todays prices (not 4 or 5 years ago but today).
It is actually the minimum you need to make in order to qualify to rent an apartment at todays rents (not 4 or 5 years ago but today).

Finding housing at a 5 figure salary (From $50,000 - $90,000) in this region to buy or rent is harder than finding a job paying $90,000 a year.

The NY Times, NY Magazine & Landlords all think that everyone living in the region is a suburban single white collar white corporate profile earning no less than $250,000 per year.

6/23/2006 04:47:00 PM  
Anonymous Anonymous said...

I JC anon, don't misinterpret what I am trying to say I assume ChicagoFinance works at a financial firm and understands that the demand to be close to downtown is very high and people can afford $2000+ a month for a studio apartment easily, although among JR. IBers people tend to rent 2 and 3 bedrooms and have a few people living with them. But my point is people can afford a high rent and rentals are scarce, if the right opportunity to buy comes along ie. rent matches the TCO on the condo they will sell. So naturally as long as there is no wall street crash there will be a healthy housing market in the premium areas of Hoboken and Downtown Jersey City as long as Manhattan stays strong. Now I think prices will fall because the interest rate increases negatively effect affordability, but don't think we will see 150k studios in JC or Hoboken anytime soon. I think JC studios probably should trade at around 200-250 depending on amenities. So now does it make sense if the payments are 1,555/mo plus taxes(Abated) of $350 plus $200 HOA fees, thats $2100 which is not much higher than a rental if, IF you can find a good one. So my point was the prices do not have to fall as much to fall in line with the spending expectations. If it was 225-250 they could sell out a project of 1000 units within a month.
So trust me there is demand, the other thing is that the money invested pursuing these projects when it was incredibly profitable dictates that they need to build to recover all the money spent to rezone the land and get the approvals. Now will all this put pressure on prices... you bet. But baring a wall street crash there will not be a crash just a deflation at least in Manhattan, Hoboken, DT JC, Brooklyn Heights, etc.

6/23/2006 05:31:00 PM  
Blogger Roadtripboy said...

I think the last few anons in this thread are the same person.

I also believe that this person is a realtor trying to spread the "prices are high because they reflect the actual market" gospel.

This same anon has been posting the same schtick on numerous threads for quite awhile now.

$250K-$300K studios are reasonable?

Please.

6/24/2006 12:13:00 AM  
Anonymous Anonymous said...

{{$250K-$300K studios are reasonable? }}}

Yes, in this market they are. It is cheap compared to all of Manhattan where you won't find any studio for less than $400,000 except maybe in Central Harlem or Washington Heights.

Most buyers in the NYC metro area are already making well in the six figures and are insensitive to increases in interest rates or paying $300,000 for a studio in Jersey City whereas the same studio on the UWS or UES would run over $500,000.

Checking on craiglist, I see that you can't even find a one bedroom for less than $400,000 or $500,000 in Jersey City or a one bedroom rental for less than $2,000 a month.

I guess if you want to pay less than $1,500 a month in rent for any size of apartment you need to look in Newark or Elizabeth if you want to be close to NYC.

At least in those areas you aren't competing with 25 year old investment bankers who can prepay the entire years worth of rent and the ridiculous realtors fees of 15% of annual rent that they are willing to pay.

6/24/2006 09:46:00 AM  
Blogger 42 said...

JC rents are laughable. what a shithole (and for someone living in Bayonne that's saying something). oh sure the riverside area is nice but you do have to buy food on occasion meaning a trip to the ghetto Pathmark by the turnpike or the Shop-rite on Marin. then it's no longer nice.

I see plenty of apts in Manhattan for less than the new junk being flung up in JC.

6/24/2006 08:16:00 PM  
Blogger Roadtripboy said...

Anon 10:46am

COME CLEAN ALREADY! ADMIT IT! YOU'RE A REALTOR!!!

I've lived in JC for 16 years and my rent is $675/mo!

Furthermore, this is the highest it's ever been!

What do mean $2000/mo is reasonable. Please!

Stick to topics you know something about!

6/24/2006 10:33:00 PM  
Anonymous Anonymous said...

{{{I've lived in JC for 16 years and my rent is $675/mo!

Furthermore, this is the highest it's ever been!

What do mean $2000/mo is reasonable. Please! }}

We are talking about Today, not 16 years ago but today.

There is hardly anything for $1,675 let alone $675 in Jersey City.

Can I just tell a landlord that I want to pay a rent of 16 years ago???

And now because of the demand from 'across the river' it is a landlords & sellers market to the extreme.

Landlords want 6 months - 1 year of rent upfront, utilities are another $300 - $500 a month, the realtors fee paid by the renter is another 15% of the annual rent for a one year lease 30% for a two year lease

6/25/2006 08:56:00 AM  
Blogger Roadtripboy said...

Anon,

the rent I posted is my rent TODAY, not from 16 years ago.

Read carefully before responding.

Thanks.

6/25/2006 01:57:00 PM  
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