Rental market had cool season on Jersey Shore

Booming demand of past years has peaked, Realtors say

September 11, 2001|By Amy S. Rosenberg | Amy S. Rosenberg,KNIGHT RIDDER/TRIBUNE

STONE HARBOR, N.J. - There was no giddiness this summer among those who rent out their Jersey Shore homes, none of the smugness of summers past when property owners raised rates, booked early, and laughed their way to the bank.

This summer they got doused with reality, facing finicky vacationers balking at pricey Shore rentals.

By season's end, the market had at last rebounded, salvaged by near-perfect beach weather, a timely August heat wave, and a lot of last-minute renting and slashing of rents. "It did pick up," said Lou Purdy, a real estate agent in Avalon. "People started to get a little religion after it got so damn hot."

`I'm sure we peaked'

But make no mistake: Real estate agents and property owners were getting their own religion this summer, with the discovery that the booming market of past years that led to yearly rent increases and a glut of new rentals had basically maxed out.

"I'm sure we peaked," said Ann Delaney, of Avalon Real Estate Agency. She said few property owners have dared to propose rent increases for 2002 - especially after the agency warned them not to even consider it, given the economy and this season's scare.

Escalating rental prices drove people to look to other destinations - property managers in North Carolina report an influx of New Jersey and Pennsylvania plates to their beach houses. Some Jersey Shore regulars booked trips to Las Vegas and Europe for the same price.

The shakier economy led renters to balk at prices that had been rising by 5 percent and 10 percent every year. Vacation stays were shortened. Full-season rentals, typically by young professionals, who no longer have as much cash to burn, continued their downward trend.

And the stable of available rentals never emptied - even in peak weeks, people could call at the last minute and find plenty of options for a weekly rental, unheard of in past summers.

In more than a few cases, property owners were willing to discount rents that had been steadily rising, often by as much as 20 percent or more.

`It's easier'

This summer, even the most loyal of Jersey Shore visitors began considering places such as the Outer Banks of North Carolina.

Betsy Metz of Devon swore she was through with her Jersey Shore vacations. After last summer's debacle - $8,500 for two weeks in a small house, 11 out of 14 days of rain leaving her cooped up with four boys - she said never again. She built a pool.

But like a lot of people this summer, the Metzes rebelled, then relented, returning to the Jersey Shore after all, ending up back in Stone Harbor, back in a pricey rental of $5,000 for just one week, which is $1,500 less than the house rented for earlier in August.

"We wanted to explore different areas like the Outer Banks; I was all excited about doing that," Metz said. "Later, it comes down to, `Let's go down to the Shore.' It's easier. It's convenient. My husband doesn't quite understand. It's the memories of going down to the Jersey Shore that keep bringing me back despite the price."

Real estate agents say they believe next year's crop of renters will be encouraged by this season's weather, the leveling off of some prices, and the ease in booking rentals, even at the last minute. Some report future bookings ahead of last year's already.

"We have been experiencing a dramatic increase in demand - not only for this year, but for next year as well," said Mark Marroletti of Parrothead Realty in Avalon, who said he began receiving 10 calls a day in late July and early August from people wanting to rent at the last minute.

"Albeit later than usual, I believe it is very relevant," he said. "I believe folks are feeling more certain of the economy, and are back to spending."

Some real estate agents say the weeks of July 7 and 14 - a time traditionally considered to be peak weeks, along with the first two weeks of August - were surprisingly weak this summer. But spur-of-the-moment renters provided an August surge.

"The procrastinators made out very well," said Diane Wieland, director of tourism for Cape May County. "There are people who are shopping around. There are a lot of bargains here."

According to the Web site, which draws from 18 Cape May County real estate agencies carrying 15,000 rental properties, 725 rentals went unrented the week of June 30; 788 the week of July 7; and 1,169 went unrented the week of July 14.

But for July 28, there were only 214 left unrented, and only 75 for the week of Aug. 4 - the summer's heat wave. The week of Aug. 11 had 284 left over and last week had about 740 still not rented.

There are plenty of rentals available for the next two weeks, which have become almost part of the off-season in terms of prices and crowds because of early school starts.

Shrinking season

The whole notion of the peak summer season has been shrinking, real estate agents say, crowded into weekends as fewer people come down for extended stays and into a few weeks in August. This year's early Labor Day cut the season down even further.

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