Don't Expect Foreclosures on Long Beach Island in 2024

Why We Will Not See A Wave of Short Sales and Foreclosures in the LBI NJ Real Estate Market

Long Beach Island Real Estate

The Long Beach Island real estate market is currently challenging, with high-interest rates and low inventory levels. Many buyers are hopeful that something will change to help their search, and for some, this hope falls on seeing a wave of short sales, foreclosures, and distressed sales in the LBI real estate market. The reality is this is highly unlikely to happen. While it is easy to draw parallels to the market of 2008 and 2009, there are vast differences between this market and that one.

By : Nathan Colmer | The Van Dyk Group

Cell: 609-290-4293 | Office: 800-222-0131 | ncolmer@vandykgroup.com

www.BuyLBI.com

Click here to search all homes for sale in the Long Beach Island NJ real estate market

Don’t Expect Foreclosures on Long Beach Island in 2024

Anyone looking to buy or sell the LBI real estate market should look at the entire picture to make an intelligent guess as to where the market is heading. As it stands, there are few, if any, warning signs that could lead to foreclosures and short sales in the real estate market on Long Beach Island.

Roughly 75% of mortgages in New Jersey, and presumable on LBI, are less than 4%
The summer rental market on LBI, a safeguard against financial trouble, it is still very strong
The market has continued to increase, even in the face of higher rates, so most homeowners on Long Beach Island hold a substantial equity position

Above all else, the equity position and the mortgage rates held by the majority of owners are the best safeguards against short sales and foreclosures in the LBI real estate market. In the last financial crisis, many homeowners held adjustable rates that rose beyond owners’ capabilities to afford them. In contrast, most loans today are low interest rate loans with fixed rates. This makes planning and affordability far easier. Over the past year alone, the market has risen between 5% and 7% on average. Considering that most owners put down at least 20%, this equity position helps protect against distressed sales. If someone purchased a home or has owned a home even longer, they are likely sitting on an even larger equity position. Lastly, the summer rental market on LBI has always helped keep the market stable. If the economy turns and individual homeowners fall on harder times, the ability to rent a home for substantial summer income helps to stabilize the LBI real estate market. It has happened before and likely would happen again. The summer rental market was a major factor in staving off short sales and foreclosures in the past, which is why, even historically, we see a low number of these types of transactions.

Why We Will Not See A Wave of Short Sales and Foreclosures in the LBI NJ Real Estate Market

All buyers in the LBI real estate market want to buy a home for the best possible price. Unfortunately, short sales, foreclosures, or other types of distressed sales are typically not the best value. By far, the best investment that can be made is to build a new home. I handle this kind of transaction quite often, and the finished product should result in an equity position of around 20%. This is the best way to “beat” the real estate market on LBI! If building is not an option, eying a motivated seller who owns a home in a good location that is likely to appreciate in value is your best play. Quality and location count for a great deal in the LBI real estate market, and understanding this is essential to a smart investment on Long Beach Island. For more information about Long Beach Island or about the LBI real estate market please do not hesitate to contact me.

By : Nathan Colmer | LBI Real Estate Agent | The Van Dyk Group

Cell: 609-290-4293 | Office: 800-222-0131 | ncolmer@vandykgroup.com

www.BuyLBI.com

Click here to search all homes for sale in the Long Beach Island NJ real estate market