Q: I’m recently retired and plan to spend most of the winter in Arizona. How can I keep the pipes in my house from freezing during the winter? Joe, Buffalo, NY A: Winter time in many colder places unfortunately means increased risk of pipes in your home or property freezing and bursting. Here are 5 tips to help prevent pipes in your property from freezing: Wrap pipes near exterior walls and in crawl spaces with pipe insulation or with heating tape. Keep your home heated when it’s cold even if you’re going away or leaving the house for a long period of time. Open cabinet doors below sinks to allow heat from the home to circulate. Cover or close […]
continue reading Q: My wife and I bought kitchen appliances and have to wait more than 6 weeks for them to be delivered, I assume because of the pandemic. Is there a way to get appliances faster? Brad, Watchung, NJ A: Real estate is one of many industries that have been affected by supply chain disruptions caused by the pandemic. Many appliance manufacturers have maintained lean inventories for a long time to minimize costs, so recent supply chain disruptions caused by the pandemic have made it difficult for them to keep up with recent increased demand. In addition, manufacturers and suppliers are operating with COVID-19 safety protocols that slow production. Independent appliance dealers are often faster and more reliable now during […]
continue reading Q: My wife and I are buying a new home. Our attorney is holding up the closing because he said he thinks we can get a better mortgage. Do you think he’s right? Earl, Mendham, NJ A: Attorneys play an important role in real estate transactions as legal advisors. I use real estate attorneys to review contracts and leases. An attorney’s job is to interpret the law–that’s it, nothing else. Mortgage financing should be left to mortgage brokers. The key to effectively managing an attorney is to make them stay in their narrow lane which is to give legal advice not financing advice, which is not their area of expertise. Thanks for your question, Earl. For more real estate […]
continue reading Q: I let my friend stay in my condo while I was away taking care of my mother. Now she won’t leave. How can I get her out? Jacqueline, Caldwell, NJ A: It doesn’t sound like your friend was a tenant–tenants have rights that occupants do not. Removal of unauthorized occupants requires pursuit of an ejectment action which is different from an eviction. Evictions normally take place in landlord-tenant court. Ejectment actions in NJ are filed in the special civil part of Superior Court. I strongly suggest you consult an experienced local real estate attorney for counsel on specific steps you should take to remove your friend. Thanks for your question, Jacqueline. For more real estate tips and information visit […]
continue reading Q: My grandparents are thinking about getting a reverse mortgage. Is it true they can lose their home after getting a reverse mortgage? Helen, Bridgewater, NJ A: The simple answer to your question is yes. If at any point during the loan period a reverse mortgage holder becomes delinquent on property taxes, homeowner’s insurance or HOA fees it could result in a default that could trigger a foreclosure action against the reverse mortgage holder. In addition, since one of the terms of a reverse mortgage is that the homeowner is required to live inside the home as their principal residence for most of the year, if the reverse mortgage holder spends the majority of the year living outside the property […]
continue reading Pandemic has been tough and a reminder of the fragility of life. Here are 3 things I’m grateful for Thanksgiving 2021: 1. None of my family or close friends died or got very ill with coronavirus and I didn’t get covid-19-I recognize that many other people were not so lucky. 2. I am not only vaccinated but boosted–the speed & efficacy of the covid-19 vaccines are nothing short of a miracle-especially for those of us in the US. 3. I’m fortunate to work in an industry (real estate) that was not devastated by the pandemic as some industries like travel & hospitality were especially at first. Happy Thanksgiving to all of you out there in my real estate insider family. […]
continue reading Q: Rents seemed to go down in many places during the pandemic. Do you think that will continue? Jules, Montvale, NJ A: Rents are actually rising precipitously in many local real estate markets now because of two main reasons: 1) jobs recovery (almost 90% of jobs slashed during the pandemic have been recovered 2) many first time home buyers can’t afford current home prices which have risen nationally 20-25% on average in the last year and job gains are creating more rental demand. In addition, the eviction moratorium has reduced the availability of rentals. High home sale prices have resulted in falling new mortgage applications and the % of home sales to first time home buyers has fallen recently. The […]
continue reading Q: I read that Zillow closed its iBuying arm. Does that surprise you? Curtis, Nyack, NY A: Another one bites the dust. Yes, Zillow announced last week that it would sunset its iBuying arm, which was its fix and flip business. Zillow also announced it will be laying off 25% of its staff. Zillow’s foray into house flipping is outside of their focus and capability and was doomed to fail from the beginning. Many Wall Street backed real estate start-ups end up overpaying for property so they can raise more money, hoping for short-term appreciation–they obviously don’t understand the difference between investing and speculating. I’m skeptical of most wall street backed real estate start-ups because residential real estate fundamentally is […]
continue reading Q: I got an offer for a home appliance warranty in the mail. Do you think that it’s worth the cost? Hector, Elizabeth, NJ A: The strength of a warranty or insurance of any kind ultimately depends on the legitimacy of whomever is offering it. Insurance companies are better equipped to process claims than an appliance company, so if you have a warranty directly with an appliance company, expect long wait times and red tape when something goes wrong with your appliance. In addition, expect to pay an additional service fee if your appliance breaks down in addition to the premium that you’ve been paying. I was an actuary for an insurance company in a former life and the fact […]
continue reading Q: I’m looking to buy a rental property. At the prices I’m seeing for properties, the rents won’t come close to covering my mortgage and costs. My cousin gets a lot of money for his place when he rents it on airbnb. I feel more comfortable now knowing that. Do you think airbnb is the way to go? Tim, West Orange, NJ A: For 6 hours on Oct 4th 2021 Facebook went down for 6 hours. There are many businesses who are dependent on Facebook who lost revenue during that outage. Likewise, in recent years there are many investors (often newbie investors) who overpaid for rental property hoping to cover their expenses and debt service by renting out a home […]
continue reading Q: Now that he is vaccinated, my son is moving back to Manhattan. The realtor he spoke with told him to prepare for a bidding war with other tenant applicants. Are there really bidding wars for apartments now? Harriet, Mendham, NJ A: Yes, it sounds crazy but there really are bidding wars now both for city apartments as well as for single family home rentals. After many people fled Manhattan during the pandemic particularly at the outset of when NYC was an epicenter for Covid spread, many people are being called back to work and others like your son, who are now vaccinated are being drawn back to the city for the same reasons they were drawn to cities in […]
continue reading Q: My friend’s home had major water damage from Hurricane Ida. Does homeowner’s insurance cover hurricane flooding? Ellen, Totowa, NJ A: Great question, Ellen. Private homeowners insurance policies typically do not cover flood damage. That exclusion also pertains to flooding brought on by or as a result of a hurricane. Typically, you have to purchase flood insurance separately. You may be able to purchase a separate flood insurance policy through the National Flood Insurance Program to help cover hurricane flood damage. The average cost of flood insurance through the National Flood Insurance Program (NFIP) is about $1,000 per year, but the amount you pay depends on your location. Flood and disaster insurance is becoming more and more important as climate […]
continue reading Q: What homes are in hottest demand right now? Lexi, Perth Amboy, N A: Average home inventory in NJ statewide is still less than 2 months which is very low and suggests high demand for homes at most price points. Now that Millennials dominate home buying now, you might think that entry level homes at or below $400,000-$500,000 would be the hottest commodity right now, however, there has been almost a 50% increase of sales of NJ homes in the $1mil-$2.5 mil price range. This surge in buying in the $1 million-$2.5 million price range is primarily due to trade up home buying activity. Trade up home buying occurs when a homeowner sells their home and then purchases a more […]
continue reading Q: Gerald, my nephew won the highest and best offer on a home he and his wife are buying. The appraisal came in lower than their bid price. What can they do? Frank, Tom’s River, NJ A: Assuming your nephew is not paying cash and is getting a mortgage to buy the home, if the appraisal comes in lower than the purchase price he offered and the seller accepted, his lender will likely decrease the amount he can borrow. As a result, he’ll likely have to pay more $ out of pocket or try to convince the seller to lower his asking price. Sometimes you can have some influence on an appraisal but only before the appraisal is actually done. […]
continue reading Q: Is there no end to rising real estate prices in NJ? Caleb, South Orange, NJ A: So far in 2021 home prices in NJ have risen 17%, which is the highest home price % increase in NJ since the 1980s. On average, home prices in NJ over the last 60 years have increased 4-5% a year, so the massive price increases we’ve seen recently cannot continue indefinitely. Ultimately, incomes underpin real estate prices, so when home prices go up faster than incomes prices must eventually fall to reach market equilibrium. Although NJ housing inventory has been rising this year, it’s still less than 2 months which is still very low historically. Home prices rise when inventory is lower than […]
continue reading Q: Gerald, how long do you think the current seller’s market in real estate will continue into the future? Andy, Greenwich, CT A: While there are certainly many more buyers than sellers in many local real estate markets nationwide, which is why home prices have been going up so fast in so many places, there really is no such thing as a seller’s market because buyers always ultimately determine price. Buyers always determine the price when assets are sold because the person with the money always decides the price. The value of a property is determined by the price a buyer is willing to pay for it. Even when there are many more buyers than sellers as there are now […]
continue reading Q: Gerald, a lot of people moved to suburban and rural areas with more space when the pandemic started. Has that trend continued? Martha, Manville, NJ A: People fled urban areas in 2020 to buy and to rent seeking perceived safety from the pandemic as well as more space for their families and for home office space. That initial trend during the pandemic has reversed itself and as I anticipated people are moving back to urban areas both to buy and to rent. For example, rental demand in Manhattan in summer 2021 was the highest it has been in 10 years. Hudson County, where my Jersey City office is located, has recently been the highest performing housing market for residential […]
continue reading Q: Gerald, I am a landlord who has been having trouble collecting rent since the pandemic started. Are rents headed up or down? Earl, Plainfield, NJ A: In July U.S. rents rose 7% for one bedroom apartments & rose almost 9% for 2 bedroom apartments year over year. As the economy improves, people are moving out of shared living situations seeking their own piece of terra firma. In addition, home prices have skyrocketed recently particularly in 2020 when the pandemic first hit and people were fleeing cities looking for more space. Eventually, as home prices climb, many home buyers, especially 1st time home buyers are priced out of the market, which is another reason rents are on the rise. Where […]
continue reading Q: Gerald, I heard that the NJ Gov. extended the eviction and foreclosure moratoriums again, is that true? Cassidy, Weehawken, NJ A: Under the first of two laws NJ Gov. Murphy signed in the first week of August, 2021 renters making less than 80% of the area’s median income will be shielded from eviction through Dec. 31, 2021 for rent owed between March 2020 and Dec. 31, 2021. Renters with income above 80% of the median income will see the eviction moratorium come to an end on Aug. 31, 2021. The measure the Gov. signed surprisingly had bipartisan support and was praised by both housing advocates and landlord groups like the NJ Apartment Association. For tenants who certify that they […]
continue reading Q: Gerald, we just bought our first piece a real estate–a condominium unit. We just sent in our first monthly condo association payment–will that cover our insurance? Duane, Rahway, NJ A: One of the main differences between homeowners and condo insurance is how much the insurance policy protects. Homeowner’s insurance normally includes coverage for both building structure & contents, however, a condominium’s structure is often shared between individual condo owners. When you own a home, you are responsible for both the inside and outside, including the land, garage and any other structures on the property. I’m not exactly sure how your condominium complex is set up, but normally the condominium association pays the annual insurance premiums via monthly condo dues, […]
continue reading Q: Gerald, how will the recent spread of the delta variant affect real estate? Oscar, Bayonne, NJ A: After things on the horizon were looking better for the summer and the rest of the year, vaccination rates plateaued and the delta variant which we knew was more transmissible has been spreading like wildfire. The damage that the delta variant will do both to the economy and real estate will vary from region to region based on vaccination rates and people’s behavior like mask wearing. Places that still have a large majority of unvaccinated residents like Louisiana will be affected more than states that have higher vaccination rates–ICUs and hospitals in unvaccinated areas are full or close to capacity. As we’ve […]
continue reading Q: My son just moved to the west coast. He and his wife want to buy a home out there. How are all the wildfires going to affect home prices and their ability to buy? Chauncey, Island Park, NY A: The effect wildfires have on residential real estate will depend on specific demand for houses in the areas where the wildfires occur. When property values are high, as they are in many parts of California for example, owners tend to rebuild rather than move away after a wildfire. Homeowners in areas like this are also more likely to have an insurance policy to assist them rebuild after a wildfire. Rebuilding has become such a common process in California that there […]
continue reading Q: Housing inventory seems to keep falling. Is that trend going to continue? Terry, Springfield, NJ A: Housing inventory in NJ has actually been rising so far in 2021 although housing inventory is still incredibly low historically. Housing inventory is nowhere near the equilibrium point of 6-7 months where home prices stabilize and beyond which home prices start to move downward. The recent increase in home inventory is being driven by the fact that home affordability is becoming more of an issue as home prices have been rising by double digit percentages. Double digit % home price changes can’t and won’t last forever and the sharp increase in home prices is finally starting to create some price resistance in real […]
continue reading Q: Prices of lots of things have gone up since the pandemic, should I expect to pay more for my homeowner’s insurance also? Eddie, Holmdel, NJ A: Insurers worldwide are constantly recalibrating the risk they insure for particularly now in the wake of the COVID-19 pandemic, which has changed many things in the world of insurance. The pandemic has reduced the risk of burglaries from happening because people have been home more often. The constant presence of residents also makes them more likely to immediately notice and address any structural problems on their property, which lowers the likelihood of filing claims. At the same time, one unexpected consequence of the pandemic was the rise in sewer backups–sewer backup coverage is […]
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