Spurred by childhood memories of endless summers of funfair rides, boardwalks and beaches, Jim and Stephanie Emme bought a second home in North Wildwood, a small city on Jersey Shore.
“We both always went there with our families,” says Jim, a 33-year-old accountant who lives just outside Philadelphia. “I still remember my dad taking me on the rides; it’s a part of what has always brought me back.” Their four-bedroom home near the bay cost them just over $400,000 in March.
For many residents of New York City, Philadelphia and Baltimore, the 141 miles of Jersey Shore beaches and old-fashioned resorts is synonymous with summer. And after years of stagnating property prices, agents say that the residential market is finally starting to move.
“The past year was the first year in a long time that we had a serious appreciation in value,” says Hugh Merkle, an agent with Compass, the property group. Merkle, who is based in Stone Harbor, says he has seen home values increase between 8 and 10 per cent in the last year compared with between 2 and 4 per cent up to 2017.
At just over two hours’ drive from New York, less than two from Philadelphia and three from Baltimore, the Jersey Shore has long offered city residents an easy beach escape during the summer months.
“It has those wonderful big old beach clubs, hot dogs and soft ice cream,” says Kathy Braddock, managing director of the New York City office of William Raveis, a property group.
Stretching from Perth Amboy in the north to Cape May Point at the southern tip, Jersey Shore offers bargains. According to Zillow, the online property database, median home values in the five counties that comprise the Jersey Shore have yet to exceed their 2006 peak — with some still a long way below. Median home values in New York City, by contrast, have risen to $674,000 — compared with the $519,800 they reached in August 2006. In Philadelphia, it is a similar pattern.
One reason for the slow recovery along the Jersey Shore is that the local economy, which relies on casinos and tourism, was hit hard by the US recession. Another, argues Mike Mavromates of Long & Foster Real Estate in Avalon, is that second-home ownership fell in the wake of the financial crash. “You need a primary residence,” he says. “But you only want a second one.”
Ocean City, which has banned sales of alcohol within its limits since its founding in 1879, has the biggest proportion of second homes of any US city, according to Smartasset, the financial technology company. Occupancy rates reach 130,000 in the summer, compared with a winter population of just 11,000.
Another cause for the slow recovery was Hurricane Sandy, which battered the US eastern seaboard in late 2012, leaving more than 200 people dead, destroying 650,000 homes and costing an estimated $65bn in damages. Merkle of Compass says Sandy hit the northern and central part of the Jersey Shore harder than elsewhere and the psychological effects killed off a rebound in the local housing market. “There was a buying frenzy in 2012, which was clearing out a lot of the inventory but when Sandy hit, it scared the hell out of people,” he says.
Avalon, Longport and Stone Harbor are the most desirable of the strip’s cities. Merkle is listing a home in Avalon on nearly 11,000 sq ft of bay front with two floating docks for $3.65m. For $3.295m, he is offering a five-bedroom, four-bathroom home a few yards from the beach in Stone Harbor. In Longport, Long & Foster is listing a six-bedroom three-storey house next to the beach for $3.195m.
The past few years have offered bargains. In 2016, Mike Scanlon bought a four-bedroom house in Atlantic City to use as a summer home. He was just 25 years old and it cost him $14,000 — a product of the high foreclosure rates following the collapse of several big casinos. “The banks were just letting these properties go,” he says. “And the prices were ridiculous; it was too good to pass up.”
Since then, he has bought more properties along the Jersey Shore which he rents to low-income families via the government’s Housing and Urban Development (HUD) programme. All of the properties, more than 40 to date, were bought at rock-bottom prices, some as low as $1,100.
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He says that few needed serious repair and some are even on the water with bay views and a place to moor a boat. “Anywhere else in the country, and these homes would be going for $300,000 or more,” he says.
Scanlon says until a couple of years ago, roughly 50 per cent of his tenants were acquired through HUD but that has dropped to 25 per cent as the local economy has picked up.
Jerry Barker, an agent in Atlantic City, says that the dark days — five of the city’s casinos shut in four years — appear to be over. Two of those casinos have now reopened and there is even a new university in town. “It’s been a long time coming,” he says. “But we’re doing really well right now.”
- Property taxes vary but are far lower than in New York
- The southern tip of the Jersey Shore is less than three hours’ drive from New York — traffic permitting
- Most cities and communities along the Shore are only eight or 10 blocks wide, meaning almost all homes are a short walk to the beach or bay
What you can buy for . . .
$1m A three-bedroom townhouse in Cape May with ocean views
$1.5m A three- or four-bedroom single-family home just a few blocks from the beach
$5m A 5,000 sq ft, six-bedroom home with ocean views
More at propertylistings.ft.com
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