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 — O c e a n f r o 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 OCEANFRONT NEWSLETTER YEAR END 2010 OCEANFRONT STUDY • • •
Features: Values of Oceanfront Properties Average Sale Price Per Foot Chart LBI Single Family Oceanfront 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 Oceanfront properties on Long Beach Island. I hope this information is of value to you!
Egon Willy Kahl
Values of Oceanfront Properties up 392% since 1992 The average sale price of a Single family oceanfront property on LBI has risen 392% since 1992! This means the same oceanfront home purchased for $500,000 in 1992 is valued today at $1,960,000! This holds true 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 oceanfront market. 2010 has proven to have increasing sales activity and a higher supply/demand ratio than in 2009, and it appears the value of oceanfront properties may be leveling off. The average sale price of oceanfront property in 2010 decreased in value approximately 20% since the peak year of 2005. Data shows that values of oceanfront properties 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: $2,113,593 in 2004, $2,433,293 in 2005, $2,523,690 in 2006, $2,153,515 in 2007, $2,470,030 for 2008, $2,326,397 for 2009 and a decrease to $2,188,741 for 2010. We have had thirty oceanfront sales this year, more than double than the 14 sales in 2009! The annual sale prices vary more than anticipated, since the class of oceanfront properties sold differs every year. In 2006, many oceanfront homes that sold were new construction, bringing higher than expected values. In 2007, the majority of oceanfront properties that sold were teardowns, creating a decline in values. In 2008, the sale of oceanfront property in North Beach, Loveladies, and on oversized lots in Barnegat Light increased the average values for two reasons. The majority of homes were newly constructed and the north end location also holds the highest land values on LBI. These sales created a higher than average sale price for oceanfront homes than expected in 2008. In 2009, we had North end properties selling. In 2010, the number of North end properties that sold were below average, bringing average prices down. The graph shows us these new values and how they increased and then slightly decreased over the years. The current frontage average along the ocean is 72.71 feet, which includes all of the oceanfront sales since 1992.
AVERAGE SALE PRICE PER FOOT
19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03 20 04 20 05 20 06 20 07 20 08 20 09 20 10
4,000,000 3,000,000 2,000,000 1,000,000 0
SOUTH
CENTER
NORTH
AVG. Price
Price/avg.ft.
PAGE 2
YEAR END 2010
LBI 2010 OCEANFRONT SALES from South to North TOWN
ADDRESS
SOUTH
DATE
LIST
SOLD
PRICE
SELL
SELL/ FEET AGE ASSESS ASSESS ASSESS
PRICE $ LIST $ WTR
BUILD
LAND
SELL$/ #BEDR. #BATH
TOTAL ASSESS$
HOLGATE
5111 S LBB
6/25/10 1,295,000 1,200,000 93%
40
23
293,300
924,000 1,217,300
0.99
4.00
2.50
HOLGATE
4905 S LBB
8/24/10 1,349,000 1,260,000 93%
50
30
187,600 1,155,000 1,342,600
0.94
4.00
3.00
HOLGATE
4305 S LBB
6/25/10 1,450,000 1,275,000 88%
60
24
286,800 1,270,500 1,557,300
0.82
5.00
3.50
HOLGATE
2501 S LBB
12/23/10 4,195,000 4,115,000 98%
104
1
1.22
6.00
7.50
BEACH HAVEN
4 3rd St
50
27
1,600,00 1,778,700 3,378,700 0 178,300 1,345,000 1,523,300
0.90
5.00
3.50
89%
50
25
128,800 1,332,000 1,460,800
1.09
3.00
2.00
104%
50
42
99,100 1,155,000 1,254,100
1.12
5.00
2.50
77%
110
56
67,500 1,848,000 1,915,500
1.19
4.00
1.50
85%
50
3
656,800 1,155,000 1,811,800
1.55
5.00
4.50
94%
80
34
65,600 1,501,500 1,567,100
0.78
4.00
2.00
83%
35
30
270,100
808,500 1,078,600
0.93
4.00
3.50
89%
55
2
450,000 1,085,700 1,535,700
1.16
4.00
4.50
90%
61
25
356,992 1,279,908 1,636,900
1.08
4.42
3.38
2,999,999 3,000,000 100%
75
1
800,100 1,443,800 2,243,900
1.34
5.00
6.00
9/17/10 2,999,000 2,775,000 93%
65
1
561,300 1,305,200 1,866,500
1.49
5.00
4.00
3/5/10
1,399,000 1,300,000 93%
45
42
164,500 1,039,500 1,204,000
1.08
6.00
2.00
8/13/10 1,100,000 1,050,000 95%
50
23
125,700
873,500
1.20
3.00
2.50
5/20/10 2,449,000 2,100,000 86%
50
5
431,000 1,150,000 1,581,000
1.33
4.00
3.50
11/17/10 1,324,000 1,200,000 91%
50
54
140,900 1,000,000 1,140,900
1.05
4.00
2.00
2,599,000 2,400,000 92%
50
6
504,900 1,000,000 1,504,900
1.59
4.00
3.00
CENTER 2,124,286 1,975,000 93%
55
19
389,771 1,098,043 1,487,814
1.33
4.43
3.29
5/7/10
BEACH HAVEN
1,395,000 1,370,000 98%
901 S Atlan- 6/25/10 1,785,000 1,585,000 tic Ave. N. BEACH HAVEN 205 E 19th 9/18/10 1,350,000 1,400,000 St. BEACH HAVEN 145 E Indi5/27/10 2,950,000 2,285,000 TERRACE ana Ave. BEACH HAVEN 121 E Kan7/22/10 3,299,000 2,800,000 PARK sas PEHALA PARK 121 E Bay12/30/10 1,299,000 1,225,000 berry Dr BEACH HAVEN 110 E Surf 11/9/10 1,199,999 999,999 CREST BEACH HAVEN 110 E Wini5/18/10 1,999,900 1,775,000 CREST fred Ave(79th St) 2010 AVG 12 SOLD IN SOUTH 1,963,908 1,774,167 CENTER BRANT BEACH BRANT BEACH BRANT BEACH SHIP BOTTOM SURF CITY
SURF CITY SURF CITY 2010 AVG
6013 Ocean Blvd 5401 Ocena 3707 Ocean Blvd. 611 E Ocean Ave 213 N. Ocean Ave (N. 3rd St) 1309 N Ocean Ave 1513 Ocean Ave. 7 SOLD IN
7/1/10
1/1/10
747,800
NORTH NORTH BEACH 1021C LBB
3/8/10
2,825,000 2,350,000 83%
100
10
563,700 2,462,500 3,026,200
0.78
6.00
4.00
NORTH BEACH 1029E LBB
7/23/10 2,999,000 2,925,000 98%
100
17
562,700 2,462,500 3,025,200
0.97
5.00
3.50
NORTH BEACH 1041 LBB
10/21/10 3,495,000 3,150,000 90%
100
56
110,400 3,461,500 3,571,900
0.88
7.00
3.50
NORTH BEACH 1083 LBB
6/16/10 3,233,500 3,095,000 96%
100
56
109,800 3,461,500 3,571,300
0.87
6.00
2.50
NORTH BEACH 1107B LBB
10/28/10 2,750,000 2,350,000 85%
80
38
350,900 2,022,500 2,373,400
0.99
5.00
3.00
HARVEY CEDARS 6311 LBB
9/30/10 2,199,000 1,830,000 83%
50
22
584,000 1,637,300 2,221,300
0.82
4.00
3.00
HARVEY CEDARS 13 E 78th St.
7/2/10
2,199,000 2,000,000 91%
100
48
282,200 1,525,000 1,807,200
1.11
4.00
3.00
6/4/10
HARVEY CEDARS 20 E 80th St LOVELADIES
83 E LBB
LOVELADIES
95D LBB
BARNEGAT LIGHT 19 E 24th St 2010 AVG 2010 AVG LBI
1,550,000 1,450,000 94%
100
67
182,300 1,150,000 1,332,300
1.09
5.00
2.00
8/31/10 5,999,900 5,250,000 88%
125
1
1.27
6.00
7.00
2/8/10
3,799,000 3,649,500 96%
125
42
1,400,00 2,750,000 4,150,000 0 95,200 3,012,500 3,107,700
1.17
4.00
2.00
11/1/10 1,995,000 1,857,500 93%
63
41
197,600 1,797,800 1,995,400
0.93
5.00
2.00
11 SOLD IN NORTH
3,004,036 2,718,818 91%
95
36
403,527 2,340,282 2,743,809
0.99
5.18
3.23
30 SOLD IN 2010
2,382,710 2,167,400 91%
72
28
381,703 1,626,277 2,007,980
1.08
4.70
3.30
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 O C E A N F R O N T N E WS L E 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 Oceanfront 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 email today!
FIRST CLASS PRESORTED U.S. POSTAGE PAID TOMS RIVER, NJ PERMIT NO. 77
Willy Kahl’s Oceanfront 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 Oceanfront 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 30 oceanfront sales in 2010 – more than doubling the 14 sales in 2009! Even more good news, the number of oceanfronts for sale has decreased from 59 to 54!
2N
D 2N '92 D 2N '93 D 2N '94 D 2N '95 D 2N '96 D 2N '97 D 2N '98 D 2N '99 D 2N '00 D 2N '01 D 2N '02 D 2N '03 D 2N '04 D 2N '05 D 2N '06 D 2N '07 D 2N '08 D 2N '09 D '1 0
These are OCEANFRONT SUPPLY VS. DEMAND CURVE the two key factors 1.50 100 to prices leveling 1.00 and perhaps soon 50 0.50 to be slowly climb0 0.00 ing! This year, the new supply vs. demand ratio has hit 0.265 (0.22 for the 1st half and 0.31 for SOLD AVAIL. DEM/SUP the second half). This is comparable to 1996, when prices began to rise! Last year, the supply vs. demand ratio was 0.115. That was the lowest it has been since I began documenting data in 1992. Simple economics states that if there is an abundance of a product (oceanfront 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. During 2002, the supply vs. demand ratio was the highest in 21 years, at 1.09 for oceanfront sales. 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 54 oceanfront properties available for sale, down from 59 the first half of 2010. The record low of 15 oceanfront properties on the market was in 2002. The high was 101 oceanfront homes available in 1993.