With Jersey City’s long-delayed revaluation finally complete and homeowners closer to paying their new rates, many questions remain as to what the effect on the real estate market will be. In their first 2018 quarterly report, Pure Properties takes a closer look.
Appraisal Systems, the company hired to conduct the revaluation, has released data that indicates the estimated tax increase in Downtown neighborhoods will be around 67% for 1-4 family homes and 24% for condominiums. The numbers are so daunting that Mayor Fulop has floated the idea of a “second revaluation” in 2019 due to changes that might take place in the market following the new rates. At least one fear about the health of Downtown’s marketplace appears to have materialized; Downtown Jersey City had a notable surge in 1-4 family homes coming to market during 2018’s first quarter, with the number listed Downtown increasing 238% from 13 in quarter one of 2017 to 44 in 2018’s first quarter.
Downtown also had 17 total sales of 1-4 family homes, a 31% increase compared to the first quarter of 2017. However, Pure Properties’ latest market report shows that while more homes are for sale, prices haven’t taken a hit. The median sales price for 1-4 family homes increased 2% from 2017’s first quarter to $1.425 million, while condo sale prices dipped 2% year-to-year to $721,000. Rents Downtown have thus far been unaffected by the tax upheaval, staying flat over the year to average $2,600/month.
Conversely, Greenville saw a spike in property values during the quarter. The neighborhood is expected to benefit from the revaluation in the form of lower tax bills, and the average sale price of 1-4 family homes in Jersey City’s most southern neighborhood jumped 17% in the quarter to $345,000. However, condo sales in the neighborhood dropped 25% over the year to an average of $307,500.
West Bergen, another spot the tax revaluation is generally expected to help, saw the second biggest gains in the county. 1-4 family homes there sold for an average of $370,000, a 17% quarterly jump and up 48% year-on-year. Condos here didn’t fare nearly as well, averaging $330,000 for a 12% year-over-year decrease.
After dominating the growth in Hudson County for the last year, The Heights slowed down a bit during 2018’s first quarter. 1-4 family home sales in the neighborhood averaged $620,000, a modest 1% increase in the quarter but still up a whopping 43% from the first quarter of 2017. Condo sales averaged $353,000, a 19% quarterly jump and 34% increase year-over-year.
Suggesting that a tax revaluation may not slow down home prices in the long run, Hoboken again recorded the highest median sales price in Hudson County. 1-4 family homes in the city sold for an average of $1.725 million, a 6% quarterly drop but up 31% year-over-year. Condo sales in the Mile Square City continued their slow and steady approach by averaging $770,000, a 3% quarterly increase and up 12% from 2017’s first quarter.
Hoboken performed a full revaluation of their properties in 2013 and has weathered the storm to consistently be the market leader, which should give concerned owners in Downtown Jersey City some hope. While this quarter’s numbers still show some caution Downtown, anticipated sale prices over the next quarter for the glut of inventory that’s available should help provide a clearer picture of where the market is headed.
Read the full Hudson County Market Report here.