Egon Willy Kahl L B I R e a l t y G r o u p , O wn e r / B r o k er — B a y f ro n t S p e c i a l i s t 2 5 6 W e st 9t h S t . S u i t e F , S h i p B o t t o m , N J 0 8 0 0 8
Cell (609) 709-1020 Office (609) 494—8900
Fax (609) 494-8901
wi l l yk a h l @ g m a i l . c o m , we b s i t e : w w w. L B I s a l e s . c o m
LBI BAYFRONT NEWSLETTER YEAR END 2010 BAYFRONT STUDY • • •
Features: Values of Bayfront Properties Average Sale Price Per Foot Chart LBI Single Family Bayfront Sales Spreadsheet
• • • •
Beach Replenishment Overview Newsletter via Email Supply vs. Demand Curve Back on the rise Supply vs. Demand Chart
This study has been created for Long Beach Island homeowners and buyers as a guide to evaluate the current market values of single-family Bayfront properties on Long Beach Island. I hope this information is of value to you!
Egon Willy Kahl
Values of Single Family Bayfront Properties Up Approximately 392% since 1992 After calculating LBI Bayfront values since 2004 and LBI Oceanfront values since 1992, I have noticed that LBI Bayfront and Oceanfront Homes appreciate at approximately the same levels. The average sale price of a Single Family Oceanfront property on LBI has risen 392% since 1992! This means the same oceanfront property purchased for $500,000 in 1992 is valued today at $1,960,000! This holds true for Bayfront property values also, despite being in a depressed market. Although many complain about the present slump in the housing market, this does not hold true for the 2010 bayfront market. 2010 has proven to have increasing sales activity and a higher supply/demand ratio than in 2009, and it appears that the value of bayfront properties may be leveling off. The average sale price of bayfront property in 2010 has decreased in value approximately 22% since the peak year 2005. Data shows that values of bayfront are higher now then back in 2004, based on average sales per linear foot. The average sale prices per linear foot each year are as follows: $1,657,365 in 2004, $2,256,542 in 2005, $1,877,883 in 2006, $2,013,796 in 2007, $1,906,607 for 2008, $1,479,088 for 2009 and an increase to $1,725,736 for 2010. We have had twenty-three bayfront sales this year, many more than the 16 sales in 2009! The yearly sale prices vary more than anticipated, since the class of bayfront properties sold differs every year. In 2005, many bayfront homes that sold were new construction, bringing higher than expected values. In 2006, the majority of bayfront properties that sold were teardowns, creating a decline in values. These uneven values year to year are due to differences of classes. The graph shows us these new values and how they increased and then slightly decreased over the years. The current frontage average along the bay is 84.14 feet, which includes all of the bayfront sales since 2004.
BAYFRONT AVERAGE SALE PRICE PER FOOT 4,000,000 2,000,000 0 2004
2005 SOUTH
2006 CENTER
2007 NORTH
2008 AVG. Price
2009
2010
PAGE 2
YEAR END 2010
LBI 2010 BAYFRONT SALES from South to North TOWN
ADDRESS
SOUTH HOLGATE
31 W Magnolia
DATE
LIST
SOLD
PRICE $
6/19/10
799,000
SELL
SELL FEET AGE ASSESS ASSESS ASSESS SELL$/ #BEDR. #BATH $/ PRICE $ LIST$ WTR BUILD $ LAND $ TOTAL$ ASSESS $ 750,000 94% 75 9 356,700 546,000 902,700 0.83 4.00 3.00
BEACH HAVEN 26 Hideaway Dr 12/16/10 2,490,000 2,118,000 85% PARK BRIGHTON BEACH 36 W 86th St 7/2/10 1,999,999 1,768,500 88%
60
10
731,700 1,380,700 2,112,400
1.00
5.00
3.50
120
3
645,800
900,600 1,546,400
1.14
5.00
4.50
120 W Winifred 10/29/10 999,900 975,000 98% Ave 4 SOLD IN SOUTH 1,572,225 1,402,875 89%
60
12
374,200
577,500
951,700
1.02
5.00
2.50
79
9
527,100
851,200 1,378,300
1.02
4.75
3.38
BRANT BEACH
5700 57th St
10/8/10 1,995,000 1,776,000 89%
100
13
770,900 1,185,000 1,955,900
0.91
6.00
5.00
SHIP BOTTOM
248 W 27th
5/14/10 1,295,000 1,200,000 93%
40
7
408,500
604,800 1,013,300
1.18
4.00
3.50
SHIP BOTTOM
252 W 27th
6/14/10
799,000
651,000 81%
40
60
151,500
548,600
700,100
0.93
4.00
2.00
SHIP BOTTOM
256 W 27th St
720000
690000 96%
40
75
78,100
548,600
626,700
1.10
2.00
2.00
SHIP BOTTOM
1701 W Bay Terrace 344 13th St
11/10/20 10 8/27/10
549,000
529,500 96%
20
16
91,400
350,500
441,900
1.20
2.00
1.00
12/21/10 1,299,000 1,150,000 89%
50
39
246,300
760,000 1,006,300
1.14
4.00
2.00
930,000 94%
62
107
115,600
871,700
987,300
0.94
3.00
1.50
12/16/10 1,099,000 1,025,000 93%
50
31
213,200
788,800 1,002,000
1.02
4.00
2.00
CENTER 1,092,625
993,938 91%
50
44
259,438
707,250
966,688
1.03
3.63
2.38
NORTH BEACH 1004H LBB
12/20/10 1,825,000 1,790,000 98%
100
39
118,300 1,230,000 1,348,300
1.33
4.00
2.50
NORTH BEACH 1012F LBB
9/13/10 1,849,000 1,744,500 94%
100
30
265,300 1,230,000 1,495,300
1.17
4.00
3.00
2/3/10
800,000 80%
85
58
65,300 1,193,900 1,259,200
0.64
3.00
4/26/10 1,395,000 1,300,000 93%
50
30
243,300
778,300
1.67
3.00
2.00
BEACH HAVEN CREST 2010 AVG CENTER
SURF CITY SURF CITY SURF CITY
1705 Bayfront St. 287 N 17th St
2010 AVG
8 SOLD IN
12/21/10
985,000
NORTH
HARVEY CEDARS 4 W. Salem Ave. HARVEY CEDARS 6304 LBB
995,000
535,000
LOVELADIES
48 W Holly Dr
3/25/10 3,950,000 3,750,000 95%
100
2
740,200 1,179,400 1,919,600
1.95
5.00
5.00
LOVELADIES
63 Bayview Dr
1/29/10 2,590,000 2,175,000 84%
121
42
308,300 1,671,000 1,979,300
1.10
3.00
2.00
LOVELADIES
164F LBB
3/12/10 4,225,000 3,900,000 92%
104
6
770,600 1,411,500 2,182,100
1.79
5.00
5.50
92%
94
15
375,100 1,345,500 1,720,600
1.34
4.00
3.00
94%
60
41
314,400
840,000 1,154,400
1.21
4.00
3.00
93%
75
24
363,800
630,000
993,800
1.41
4.00
4.50
88%
175
14
1.34
6.00
5.50
92%
97
27
1,006,90 630,000 1,636,900 0 415,591 1,081,482 1,497,073
1.38
4.09
3.60
1,732,300 1,579,239 91%
77
30
380,670
1.22
4.04
3.11
LOVELADIES
170G Sea Pine 5/18/10 2,495,000 2,300,000 Dr HIGH BAR HAR- 38 Antioch Rd 4/1/10 1,495,000 1,400,000 BOR HIGH BAR HAR- 21 Meadow 10/29/10 1,499,000 1,400,000 BOR Lane HIGH BAR HAR- 41 Meadow 12/28/10 2,495,000 2,200,000 BOR Lane 2010 AVG 11 SOLD IN NORTH 2,255,727 2,069,045
2010 AVG LBI
23 SOLD IN 2010
911,265 1,291,935
Note: All Statistics are deemed reliable but not guaranteed. Data was retrieved from the Greater N.J. Regional Multiple Listing Service Computer. This letter is not intended to solicit property currently listed. Egon Willy Kahl’s opinion has been stated throughout. This newsletter is an exclusive publication and cannot be reproduced without prior written permission from Egon Willy Kahl. ©
YE A R EN D 2 0 1 0
LB I B A Y F R O N T N E WS LE T T E R
PAGE 3
LBI Beach Replenishment Project Overview One of my favorite pastimes on LBI is taking a boat trip out of the Barnegat inlet and around the Island! On these boat rides, I can get a clear view of the different beach landscapes along Long Beach Island. The beaches took a severe battering from the fall and winter storms (2009/2010) and there wasn’t much beach left in some areas. When storms are frequent, the beaches do not have enough time to recover. The Edwin B. Forsythe National Wildlife Refuge located at the south end of Holgate has shifted westward by about a block. If nature had its way, the entire Island would be shifting similarly. Several decades ago our lighthouse was in trouble, along with oceanfront homes at the northern tip of Barnegat Light. The Inlet was moving south, and nature wanted to wash out Barnegat Light and a few of the northernmost homes on the Island. The Army Corps of Engineers came in with Jetties a mile long saving the Inlet location and Barnegat Lighthouse. Now these homes that were nearly in the ocean are situated on one of the safest locations on the Island. During the winter months, storms can cause a beach to erode. The beach gradually accumulates sand as the result of currents produced by low waves that return sand to the beach during the calmer summer months. A severe storm with high tides and strong wind and waves may cause significant erosion in a very short amount of time and could take months of normal wave and tidal conditions for the beach to recover. When storms roll in one after the other, the beaches just don’t have the essential time needed to replenish themselves. Restored beaches provide the community protection from storms that haven’t had time to recover naturally due to the frequency of the storms. Beach replenishment activities have been ongoing for years on Long Beach Island. Several areas (including Brant Beach, Beach Haven Crest, and in the past even Harvey Cedars) have been bulldozing dunes back for years every time there are even small storms. After severe storms, brown dirt is trucked in from the mainland to create a manmade dune and white sand is then bulldozed over it. Surf City was the first to receive the beach replenishment project years ago. Mayor Connors of Surf City added an ordinance stating those oceanfront owners who didn’t sign over their property easement would be responsible for paying for their own replenishment. Hence, the Surf City oceanfront owners signed relatively quickly. The project started and was completed years ago and Surf City is now known to have the most stable pricing and most sales versus the majority of LBI. Buyers want the replenished beaches and the replenishment projects are adding value to LBI properties! Harvey Cedars had received the replenishment last winter and their dune structure and replenished beaches are even wider than the beaches in Surf City. In South Beach Haven, Geotubes (massive textile sacks filled with sand) were installed last spring for a two block area to fight chronic erosion problems. The tubes are now buried under the beach, the sand has risen over them and the beach is back and healthy. There are numerous similar replenishment projects up and down the east coast. Although, the ongoing beach replenishment projects allow us to enjoy the benefits of living down the shore, there are still many oceanfront homeowners unwilling to sign off on the beach replenishment project. Some do not want to give away the dune rights that they own without being reimbursed, others are afraid of public walkways and restrooms being installed. Some of the owners that are in poor physical condition do not wish to walk further to get to the ocean. Natural removal and transport of sand will continue and the beach replenishment project cannot prevent erosion but a nourished beach provides storm protection. A wide beach is an energy absorber from the wave impact of storms. The replenished beaches will have to be maintained and nourished because beach nourishment is not a one-time event but an ongoing maintenance project. Currently, Congress has not appropriated any beach replenishment money for 2011. The Senate has preliminarily fitted $7.5 million in their budget, but it will need to survive the joint budget committee. The project’s continuation is not looking good for 2011, but possibly for 2012. Long Beach Township’s first project, when funded, will be the first mile in Brant Beach and the Township is ready.
E-Mails, Quicker & Highly Preferred Get the LBI Bayfront Newsletter before they hit the press! Willy Kahl prefers e-mailing you these newsletters. They come out twice a year and your e-mail address will remain confidential.
Please e-mail Willy Kahl at willykahl@gmail.com and tell him you prefer these newsletters via e-mail today!
FIRST CLASS PRESORTED U.S. POSTAGE PAID TOMS RIVER, NJ PERMIT NO. 77
Willy Kahl’s Bayfront Newsletter Egon Willy Kahl / Broker of Record LBI Realty Group 256 West 9th St. Suite F Ship Bottom, NJ 08008
Cell (609) 709-1020 Office (609) 494-8900 Fax (609) 494-8901 EMAIL: WILLYKAHL@GMAIL.COM WWW.LBISALES.COM
Dependable Bayfront Data Enclosed! For properties currently available for sale and those under contract, please feel free to call me. I’ll be happy to e-mail, mail, or fax current Multiple Listing Computer detailed reports!
SUPPLY VS. DEMAND CURVE BACK ON THE RISE Great News – we had 23 bayfront sales in 2010 – many more than the 16 sales in 2009! Even more good news, the number of bayfronts for sale has decreased from 48 to 32! These are the two key factors to prices leveling and perhaps soon to be slowly climbing! This year, the new supply vs. demand ratio has hit 0.31 (0.21 for the 1st half and 0.41 for the second half). This is comparable to 1996, when prices began to rise! Last year, the supply vs. demand ratio was 0.17. Simple economics states that if there is an abundance of a product (bayfront homes) and few consumers (Buyers), values will decline. Values become stable when we reach an equal number of Buyers and Sellers. When the product is scarce and the demand is high, values increase. Many economists believe that when there is a six month supply of homes for sale we have reached equilibrium. More than a six month supply creates a buyer’s market and less creates a seller’s market. Currently, there are 32 bayfront properties available for sale, down from the 48 available the first half of 2010. BAYFRONT SUPPLY VS. DEMAND CURVE 1.00
60 50 40 30 20 10 0
0.80 0.60 0.40 0.20 0.00 1ST 2ND 1ST 2ND 1ST 2ND 1ST 2ND 1ST 2ND 1ST 2ND 1ST 2ND '04 '04 '05 '05 '06 '06 '07 '07 '08 '08 '09 '09 '10 '10
SOLD
AVAIL.
DEM/SUP
HALF 1ST '04 2ND '04 1ST '05 2ND '05 1ST '06 2ND '06 1ST '07 2ND '07 1ST '08 2ND '08 1ST '09 2ND '09 1ST '10 2ND '10
BAYFRONT DEMAND SUPPLY SOLD AVAIL. DEM/SUP 19 22 0.86 10 26 0.38 10 30 0.33 11 34 0.32 8 38 0.21 7 42 0.17 11 46 0.24 11 44 0.25 7 47 0.15 10 46 0.22 5 49 0.10 11 45 0.24 10 48 0.21 13 32 0.41