Vacation home owners on the famous Jersey Shore have seen rental bookings plummet after raising prices to make it cheaper to vacation in Italy.
The once thriving rental market has come to an abrupt halt as locals and holidaymakers alike turn their backs on sky-high rents and instead seek out cheaper – and often more exotic – alternatives.
The slump began last summer but reached a breaking point earlier this season as panic set in among homeowners looking for tenants. Analysts say some rental properties are about a third more expensive than they should be.
And bookings have dropped so much this season that they are now offering discount weeks for last-minute bookings and ending long-standing practices such as requiring renters to book from Saturday to Saturday, as reported by the Philadelphia Inquirer.
Vacationers are now opting for cheaper rental properties abroad, for example in exotic locations such as Aruba, North Carolina or even Italy. These rentals cost less than staying on the Jersey shore.
Greedy homeowners along Jersey’s iconic shore who have driven up prices are now facing a harsh reality as demand for ‘overpriced’ rentals dwindles and locals say it’s cheaper to head to the Caribbean or even Italy (Pictured: Huge home on Long Beach Island, New Jersey)
An Avalon mansion with enough beds for ten guests saw its weekly rent drop from a whopping $5,250 in July to just $3,000 in September.
Meanwhile, a Ventnor property sleeping 12 is desperately trying to justify its $7,600-a-week price tag by sweetening the deal with unexpected extras.
“Just added – 6-passenger golf cart and 2 paddle boards!” the ad reads, in what appears to be a last-ditch effort to attract renters.
A Montgomery County mother, who asked not to be named, said she was asked for $36,000 for four weeks in a five-bedroom house in the “war zone” of Sea Isle City.
“So we’re going to Italy for two weeks for less than half the price,” she wrote.
Cole Checkoff, who runs a short-term rental website in the area, told the outlet: “There was a lot of listings that weren’t being rented to people asking $30,000 a month for homes that are only worth $20,000 a month.”
“That put me in a good position,” he said. “I’m cutting the calendar up a little bit more, [offering rentals for a week or less]. More last minute bookings are being made. The booking window has become shorter in recent summers.’
During COVID, travel bans and widespread fear of contracting the virus created a surge in domestic demand for classic American resorts like those along the Jersey shore, deterring Americans from traveling.
But traveling abroad for a vacation is now more popular than ever before — with the good times for many U.S. resorts that were hugely popular during COVID-19 now well and truly over.
“The world has changed back to what it was. Internationally, people have options they didn’t have three years ago,” said Tara Cruser-Moss, a broker with Berger.
Some investment property owners are also struggling.
A Sea Isle home buyer who raised the rent to pay his mortgage said, “Last summer I rented out the whole house.”
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“People were reaching out left and right. I raised my rates a little bit, the highest from $3,500 to $3,750. It’s a lot of work,” he added, admitting, “I don’t make a lot of profit. I just thought it would be easier to fill.”
Maria Sacco Handle, a real estate agent in Brigantine, has been providing advice to clients looking for tenants.
She advised her clients to lower minimum stays, reduce weekly rents by 20 percent and even consider selling.
“Given the slow rental market contrasted with a booming sales market, it may be worth considering selling your property,” Handle warned. “We recommend evaluating this option as soon as possible to avoid potential oversaturation in the market.”
She saw many people listing their new homes for sale in the oversaturated market in Brigantine.
A Montgomery County mother said she was quoted $36,000 for four weeks in a five-bedroom house in the “war zone” of Sea Isle City — so she’s going to Italy for two weeks for less than half the price
Before the pandemic in 2019, there were 500 rental properties on the islands, she told the Inquirer.
There are currently no fewer than 950 rental properties available for rent.
“A lot of people thought they wanted to own an AirBnB,” she said.
“We tell them to lower the price,” she said. “Add all the extra amenities. Take the linens. Ultimately, it’s, ‘I can take my whole family on a cruise for the same price as I would on land, and the food is included.’
