Shore rentals heat up as home sales cool off
Posted on Monday, January 22nd
OCEAN CITY — Fewer people may be buying a piece of the shore, but more are renting part of it.Real estate businesses are reporting a surge in rentals even as home sales decline along the coast. An increase in rentals as high as 40 percent has been recorded by some real estate companies. Most are seeing a jump in the 10 to 15 percent range.
“We're up about 10 percent from this time last year and up another 10 percent from the year before that,” said Frank Shoemaker, of Berger Realty on Asbury Avenue.
Shoemaker said the company did about 9,500 rentals last year and has a full-time rental department manned seven days a week.
It used to be that the same agents who sell homes did all the rentals. But now many firms are establishing separate rental departments in which the agents do only rentals and are extremely responsive to their clients' needs.
Many firms are finding the rental business keeps them afloat as home sales lag. Rentals are up 15 percent for Farina & Boeshe Real Estate Co. in Sea Isle City, and David Farina said it has been a blessing.
“The strength of our rental business is an oasis any time you get a down market with sales,” Farina said.
One of the larger increases is at the Homestead Real Estate Co., a West Cape May firm aggressively seeking rental clients.
It wasn't always this way. Owner Dagmer Chew didn't branch out into the rental business until four years ago.
“I resisted the rental business. I was forced to do it by economics,” Chew said.
Chew said she was expecting a 10 percent surge in rentals between September and January, and rentals rose 40 percent from the same time period a year ago.
“If we didn't have this rental department, we'd be hurting,” Chew said.
The business of shore rentals is changing. In the past, potential vacationers would drive to the shore during the coldest time of the year to begin scouting for a home to rent. Plenty of this still goes on, but vacationers can also take advantage of the Internet.
“We have an online virtual tour of every property. Family members across the country can take the virtual tour and pick out a house,” Chew said.
She remembers starting in real estate more than a dozen years ago when long weekends, such as Presidents Day and Martin Luther King Jr. Day, were a time to haul renters around to look at properties.
“I'd take a beach bucket of keys, get in the car and schlep a bunch of people around. It's all automated now,” Chew said.
The automation also helps getting all the paperwork done. The renter can drive to the real estate office when they arrive in town and pick up the key. Homestead offers linen service, a property manager to respond to any problems, maps of the area, quick credit card payments and other amenities. Like many firms, they now have a rental department with agents who do only rentals.
“We don't call them tenants anymore. We call them guests,” Chew said.
Better rental properties and improved services could be part of the upswing. There could also simply be more vacationers renting as shore hotels, motels, bed & breakfasts and other accommodations get replaced with condominiums. Some say the most recent upswing may be as simple as warm weather at the start of this winter.
Ron Giordano, of Atlantic Beach Realty in Stone Harbor, said more people are checking out properties on the Internet and visiting the shore to look at properties.
“For the rentals, the people have been showing up. Usually January can be a slow month, especially when the Philadelphia Eagles are in the playoffs,” Giordano said.
There is another upside to rentals, noted Greg Giancola, of Caldwell Banker Sol Needles Real Estate in Cape May.
“It's part of our salary and also part of the people maybe buying in the future,” Giancola said.
Rentals are up at Caldwell Banker 10 to 15 percent, and each new renter is a potential buyer as the market for home sales thaws. In fact, many real estate agents say the market over the past several weeks is showing signs of life. It's too early to tell, but maybe a surge in rentals is a good sign for the future.
