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In good times and bad, selling homes at shore is good

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Posted: Sunday, June 16, 2013 12:00 am

SEA ISLE CITY — Matthew Iannone has been selling real estate locally since 1973, so he’s seen good times and bad.

One thing hasn’t changed: Land next to the ocean is limited.

And that, the new president of the Cape May County Association of Realtors said, means the market can only be good in the long term — as long as the ocean is there and people want to live or vacation by it.

“At the seashore you never overpay. You just bought too soon and eventually things will catch up,” said Iannone, who owns the Freda Real Estate Agency on Landis Avenue.

Need evidence? Iannone, 63, of Upper Township, has an advertisement from a newspaper printed in the 1950s that offers oceanfront building lots in Sea Isle for $490 and homes on them for $4,990. Such an investment has gone up more than 100-fold.

“Not a bad investment,” he said.

More evidence: Iannone tracked the same house selling for $9,350 in 1963, $130,000 in 1988 and $715,000 on Jan. 18, 2013.

That doesn’t mean there won’t be bad times. The real estate boom that began in the 1990s and crashed with the national economy in 2008 was one of those times.

“We’ll always have that stagnant period. A lot of people did get caught in the borrowing and sold for a lot less than they bought for,” Iannone said.

The recession also hurt those listing the properties. When sales are down, so are commissions. Some left the business. Iannone said association membership dropped from 1,534 in 2006 to 1,133 today. The association, which supports the industry in many ways, still maintains a staff of four and an office in Dennis Township.

As the new president, Iannone’s job is to oversee the organization, conduct meetings of the board, attend national meetings, make sure the Multiple Listing Service is running smoothly and other duties.

“The agents load everything into the MLS, but our staff oversees it. It’s run by the association. When anything goes into MLS, it automatically goes to other sites. It’s so important to be out there on as many sites as possible,” Iannone said.

The market appears to be improving, and Iannone said that is due in part to low interest rates and property owners accepting reduced prices.

“We’re holding our own and getting rid of a lot of inventory, especially on the islands. We found out where our prices should be. We finally started reducing them, and things started to take off. We’ve had a couple of bidding wars, believe it or not,” Iannone said.

People may complain about prices going down, but Iannone puts it in perspective. He cited a condo in Sea Isle that sold for $685,000 at a reduced price, but the same unit sold for $385,000 in 2001.

And condo sales are starting to pick up. Iannone cited figures for Cape May County that show sales of condos rose from 456 in 2011 to 556 last year. This year, through May 29, they are at 338 units, so the trend is continuing.

Sales of residential units rose from 951 in 2011 to 1,124 in 2012. They are at only 383 so far this year, possibly because mainland sales still lag and are somewhat job-dependent.

There is also uncertainty over new recommendations on shore construction coming from the Federal Emergency Management Agency later this year and expected increases in federal flood insurance premiums.

FEMA may call for higher elevations for new construction and homes undergoing substantial renovation in some coastal areas, but Iannone said towns are already starting to incorporate changes based on preliminary FEMA information and developers are adapting.

Iannone said flood insurance increases are geared mostly to second homes and the older ones built at ground level as subsidies are reduced to make the program more solvent. He said Congress for years had talked about doing away with federal flood insurance, and the increases are a fair compromise.

“Flood insurance rates will go up to what they should be. It doesn’t seem like it will hold up progress in Sea Isle City. In other communities, it may,” he said.

The Iannone and Freda families began selling real estate locally in the 1950s at a firm founded by Matthew Iannone Sr. and Carmen Freda. Iannone began working at his father’s business in 1973, rising to owner and broker of record in 1985. He has seen a lot of changes in the business and the association, where he served an earlier stint as president in 1998.

“There have been some big changes in technology. That’s the major change. In 1998, we had boards (with listings) and handouts, and lots of paper. Now it’s mainly on the computer and Internet,” he said.

Take summer rentals. People used to flood into shore towns during spring breaks to physically look at potential places to rent. Now they view the possibilities on the Internet, sometimes even looking at virtual video tours online.

Iannone said it has only been since 1996 that his listings could be displayed by other agencies on the Internet. State rules had to be changed to allow that. They still can’t be displayed on a board at the other real estate office. He also remembers when credit card payments were not allowed and money could not be wired.

“It was only cash, checks or cashier’s checks,” he said.

Iannone said rentals also are doing well from Cape May to Ocean City. He said the association would continue fighting attempts to impose new taxes on them.

“What I see in the county is we’re making a lot of sales, and everybody’s feeling in general is we’re over the worst and on the way to sustained good activity,” Iannone said.

That is not surprising to Iannone. After 40 years in the business, he knows the long-term trend.

Contact Richard Degener:

609-463-6711

RDegener@pressofac.com

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