‘Seller’s Market’ on LBI’s Doorstep as Million-Dollar Average Sales Price Prevails

By MARIA SCANDALE | Aug 30, 2017
Photo by: Ryan Morrill

The average sale price of a Long Beach Island home has again surpassed the $1 million mark, shows research by Sand Dollar Real Estate, as outlined at an LBI real estate seminar held by the agency Aug. 24.

The year-to-date average sales price of $1,085,837 exceeds the $1,027,591 figure from the year 2015, the last time the $1 million average was hit.

“We are about where we were at the height of the market in 2007-2008,” said Pat Sepanak, broker/owner of Sand Dollar Real Estate, in Surf City. The figures represent the total of all single-family residential homes sold by all agencies.

A major reason the average sales price has been increasing since fall 2016 is the interactive supply-demand relationship.

“It appears that we may be entering a ‘seller’s market,’” Sepanak stated in a Summer 2017 Sand Dollar Real Estate market trends newsletter. “It’s been a long time since this has been said.

“Inventory has consistently been lower than past years,” and there has been “an increase in buyer activity throughout the year,” Sepanak said.

“The (sales) market has been very high,” and “right now we’re looking at inventory levels and they’re low, almost to the numbers post-Sandy,” she added at the seminar. “If buyer activity continues to rise and inventory remains consistent or drops, then prices will continue to rise.”

The timeless appeal of the Island’s soft white sand is within a two-hour drive of New York, Philadelphia and northern New Jersey’s vast markets, plus LBI is “family-oriented and safe, noncommercial, and upscale,” Sepanak listed. A large back bay area for recreation is a bonus that not all beach communities in other areas have, she added.

Recently, buyers from southern Connecticut are reaching to LBI in addition to the abovementioned major metropolitan clients. In the 1970s, Philadelphia was the source of most vacation homeowners before the shift toward northern New Jersey started in the 1980s, and then New York added to the mix starting in the 1990s.

“Also, parts of Pennsylvania are starting to re-enter our market. Not just from the Philadelphia area, but we’re also seeing central and western Pennsylvania starting to come into our market,” Sepanak told those at the seminar.

Where rentals are concerned, the agency broker/owner, who has over 30 years of LBI real estate experience and a degree from Rider University in marketing/finance, candidly identified the competition among alternative venues as well.

“Other nontraditional venues are joining the summer market, and by that we mean the Caribbean, all-inclusive packages to Mexico,” and discounted cruises, she said. “They offer some very nice discounts during the summer months, and at our price point, this is an alternative.”

Southern U.S. destinations are known to have taken some rentals away from New Jersey shore resorts after Superstorm Sandy, according to various sources. Sepanak is among local brokers who believe some vacationers may be have been “trying out” those destinations for a few years.

“Our pricing hasn’t gone up a lot since 2014 ... our oceanfronts average $8,000-$10,000 per week, we have oceanfronts getting $20,000 a week,” she listed. Ocean block contemporary homes are averaging at $5,000-to-$8,000-per-week price points.

By comparison, “we know right after Sandy, people went to the Outer Banks,” she said, and pointed to large rental homes in the affluent northern beaches there in the $4,200 to $5,400 range with many amenities.

“So, this starts to become competition.” On the positive side, “when the economy is doing well, “LBI is chosen,” Sepanak said. But, “when the market financially gets a little tight, they’ll take the drive.”

Full figures from the summer 2017 rental season aren’t in yet, but Sepanak expects numbers to exceed last year, although they are down from the pre-Sandy 2012 summer levels. Some observers have added that since Sandy, some renovated homes are being used by the owning family.

In short, “we have seen higher guest expectations through the years as we shift more to that North Jersey/New York market. We see requests for accommodations equal to or better than at home,” Sepanak said.

— Maria Scandale

mariascandale@thesandpaper.net

 

 

 

 

 

 

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