Lakewood area housing bubble

amother

↑ Bluebonnet ↓

Sun, Jan 02 2022, 7:08 pm

A 900,000 house has a mortgage around $4500-$5000 depending on down payment.
Do not tell me that a regular couple, wife working 10-2 in an office and husband in kollel, without a lot of support, can pay $60,000 a year in mortgage. That would be more than her salary.

“Regular” people - both working or one working and no major inheritance or support are moving to Manchester or Jackson.

amother

↑ Stonewash ↓

Sun, Jan 02 2022, 7:09 pm

amother [ Springgreen ] wrote:

This happened before and will happen again. It’s a cycle. Each time we near the peak you hear people saying “no way, it’s not a cycle, prices in Lakewood will keep going up”. I k ow this because that’s what happened last time around. And the time before that.

In 2006-8 everyone was afraid of being priced out of the market. Came 2009-2010 and single family houses were sitting for months at 400k. Historically houses appreciate at slightly higher than the rate of inflation. When they get ahead of themselves they often stagnate until things even out. I’m guessing we are seeing peak now with a long period of stagnation/ slight price dips to come.

In our communities prices don’t fall. Maybe they level off but they don’t fall
Too much demand.

amother

↑ Birch ↓

Sun, Jan 02 2022, 7:16 pm

amother [ Bluebell ] wrote:

Is it realistic to think these prices in Lakewood will go down in the next 2-3 years?

Should potential homebuyers attempt to wait for the bubble to burst?

It's something I considered, but I decided what if it doesn't? Also how far out will I have to buy in 2-3 years? There are risks with buying now and with buying later. You have to weigh them all and figure out what's the best option for you.

sky

Sun, Jan 02 2022, 7:17 pm

amother [ Springgreen ] wrote:

I could write this post word for word.
2006 lakewood market housing market was crazy. No one thought it would crash.

Investors and realtors were driving prices up like mad. It was bidding wars and houses sold in seconds at 100k over asking price like now. Ppl bought then in rain tree and Coventry the and only now are seeing their houses back at the price they paid.

But I wonder if it will crash now bec so many young couples are desperate to buy bec of rent prices. But there is potential to crash bec ppl are moving so far out. The prices far out are crazy high. Ppl selling at 200% increase 6 months later. I believe that will crash.
But In town I’m not as sure.

Last edited by sky on Sun, Jan 02 2022, 7:19 pm; edited 1 time in total

amother

↑ OP ↓

Sun, Jan 02 2022, 7:18 pm

amother [ Stonewash ] wrote:

Many bought homes years ago the prices went up- they are selling and moving to other areas. They lived in basements while tenants paid the rent which covered the mortgage They are not telling you that they are homeowners. I have co workers living in rental apts in BP- who have houses with tenants in Lakewood. Some invested in stocks or bitcoins. Some received inheritance. Some did tutoring or the women work in jobs that bring good parnasa. There could be so many reasons.
Also you only need 3 percent down with some govt programs like fannie mae. So that’s 27000 for a downpayment. If they livedin a small basement with low rent and lived frugally and saved they can pull it off.

I could also put down 3% of 900k, it’s the monthly payments that boggle my brain.
And also they need to have enough income to be approved for a high enough loan.
(And that’s without bringing into the picture the houses that get under appraised because of how fast this market blew up.... which is potentially more money needing to be put down)...

I really wonder if the answer is parental support for majority of these ppl.

The ones who buy in lkwd are renting basements, so that’s answers the lkwd purchases, but it doesn’t answer for Jackson and Toms River where the basements aren’t rented.

amother

Offwhite ↓

Sun, Jan 02 2022, 7:20 pm

amother [ OP ] wrote:

I have a feeling ppl are renting out there. I’m seeing plans for new developments in Toms River and the plans are allowing for rentals.

amother

↑ Violet

Sun, Jan 02 2022, 7:21 pm

amother [ OP ] wrote:

There are programs where section 8 can pay your mtg. Some have family support. Rent has also gone up. If there is an accessory unit, rental income can go toward the mtg calculation.

amother

↑ Stonewash ↓

Sun, Jan 02 2022, 7:33 pm

Many homeowners are doing short term rentals. Weekends and yomim tovim. And charging a pretty penny.
As for the 900 thou homes. I think those are being bought by previous homeowners, investors or people who bh have a very good parnasa or invested and bh their investments were matzliach.
I have a family member who is living in rent, invested and saved for about 10 years and bh bought a house now, not for 900, more like 750. They are not a kollel family.

Flip Flops

Sun, Jan 02 2022, 7:45 pm

I absolutely don't think prices will crash.
This isn't just about inflation or regular supply and demand. There are hundreds of Brooklyn families moving to Lakewood. There is a pilgrimage to the Lakewood area and there simply aren't enough houses for thousands of people to relocate to in a few short months. As long as the trend of moving to Lakewood continues, housing prices are going to continue to rise. Give it a few years and it will be way more expensive to live in Lakewood than to live in Brooklyn.

amother

↑ OP ↓

Sun, Jan 02 2022, 7:51 pm

amother [ Bluebonnet ] wrote:

The houses in Jackson (and manchester) are also getting crazy. Even if not that they are soooo expensive, but they are going for a ton more than asking for houses that aren’t worth that much.

amother

↑ Offwhite ↓

Sun, Jan 02 2022, 7:57 pm

amother [ OP ] wrote:

The houses in Jackson (and manchester) are also getting crazy. Even if not that they are soooo expensive, but they are going for a ton more than asking for houses that aren’t worth that much.

Someone told us he is buying his dd house.
He offered cash, as us, thoudands over asking price for 4 bedroom house. They laughed at him snd said nice try.
I don’t think those homes will retain their value.

Last time they also said it was impossible crash…

I’m not saying houses will go back to old prices. Of courses prices are now higher.

But a house that sold 6 months ago and for 600,000 and is now listed for 1.3 million bec it’s the only Ouse listed. Or houses up 300k in 2 months.
I don’t believe those will retain their value.

Also ppl are spending a lot on houses that are limited. Like if you buy a 4 bedroom home in Manchester with a septic tank designed for 4 bedroom it’s near impossible to add on. Those home aren’t worth what ppl are are paying now. Some homes in Jackson also have this problem.

amother

Peony ↓

Sun, Jan 02 2022, 8:11 pm

sky wrote:

But I wonder if it will crash now bec so many young couples are desperate to buy bec of rent prices. But there is potential to crash bec ppl are moving so far out. The prices far out are crazy high. Ppl selling at 200% increase 6 months later. I believe that will crash.
But In town I’m not as sure.

Exactly, Manchester and Jackson will go back down. There’s no way they’ll stay at those wacky prices. As for Lakewood I think some places will go back down, like raintree and westgate. But we will see

amother

↑ Peony ↓

Sun, Jan 02 2022, 8:20 pm

amother [ OP ] wrote:

It’s not just investors doing it. Regular ppl who are living in the houses after buying them are doing it too.

I saw a small cape in brookwood1 for 350k and it was in horrific condition, and I heard from my realtor that they accepted an offer for 500k....

I feel sorry for whoever bought it. That house is going to plummet in value.

amother

↑ Stonewash

Sun, Jan 02 2022, 8:59 pm

amother [ Peony ] wrote:

I feel sorry for whoever bought it. That house is going to plummet in value.

I respectfully disagree. Many are moving from Brooklyn because there is no room or anything available or too high priced. And lakewood is also outgrown. As yiddishe communities build up supply and demand changes. Prices will not plummet. They will level off

amother

↑ Birch ↓

Sun, Jan 02 2022, 9:11 pm

amother [ Bluebonnet ] wrote:

? Look in the masa umatan. There are rentals in Toms River we have looked at them this past week !

Yes full houses not basement rentals. But most are temporary a year or less. They aren’t investments.