The Curious Case of This $2.5 Million North End Condo (137 Ocean Ave.)

It’s not every day you see a non-waterfront 5+ bedroom condo for sale for over $2 million.

In fact, one has never sold even close to this price point in the North End.

But this beautiful, year-old, 6-bedroom second floor condo on Ocean Ave. still stands out for having been on the market for almost two months now, with a $60k price reduction.

This is the sort of unit could have named its price during the more fevered sales pace of mid-2021.

So what gives?

$2.5 million for a second floor condo with a healthy walk to the beach feels overpriced. And the comps don’t help. A 5+ bedroom condo hasn’t sold in the North End for over $2 million ever.

The property itself was sold by the builder, ClarkEdward, in 2021 for $1.5 million.

The closest comps are a 6-bedroom unit on 2nd street by the high school and a new 5-bedroom unit on Delancey Street right near the beach that sold in October for $2.1 and $2 million, respectively:

One veteran Ocean City relator we spoke to said: “Should be asking 2 mil for that.. maybe 2.2 max.”

It probably doesn’t help that it’s listed as Ocean Ave., not Rd., in the MLS, throwing off map searches for the Gardens:

There’s also the question of rental income.

The listing claims this property could gross upwards of $180k this year:

This Property has brought in 172, 000 dollars of Rental income in 2022 and mostly booked for 2023 ( 2023 Possible Projected Rental Income 180k)..! Look no further for an investment that has a cash flow. 

Joe Jauss, listing agent

We’ll take that at face value, but that seems like a bit of an outlier.

The same agent we spoke to cited 842 St. James, a single-family home just outside the Gardens, as the best rental comp, and said the following about the prospect of expecting to gross nearly $200k on this: “No way…. You’re looking at about 120-130 gross income for the summer you could try to find someone to rent the winter but not many people are looking to pay 10k a month for a winter rental.”

And from a cash flow perspective, at current interest rates with 20% down, you’re looking at about $13,500 per month for the mortgage ($162k annually), so you’d be barely breaking even, at best, in most expected scenarios.

With an influx in more year-round residents to Ocean City, the North End has seen a bit more demand given it’s close proximity to shops, services, and boardwalk.

Still, this year-old second floor might still be listed a few bones too high.

We’ll keep an eye on it.

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