I thought it would be a good time to take a look at how Cresskill real estate is today and how projections are for tomorrow.
Cresskill is like “A Tale of Two Cities.” At over $2 million, the for sale to under contract ratio is 20 to 1; at under $1 million, it drops to 5 to 1. According to Jeff Otteau (www.Otteau.com) when you get to 5 to 1, you’re entering positive territory.
The rarified world of luxury properties has suffered. On top of the economic collapse, financing for these estates became extremely demanding with down payment requirements of 45-55%. This recently adjusted to a realistic 20-25%. For most of us the picture is different.
The product mix moved higher this year. Fewer homes should close under $350,000 and more at $350-450,000. Homes are selling much faster – how about a 33% improvement in the $400-900,000 price range? This is huge; today a mortgage requires more time due to new regulations. This shows demand is up for Cresskill plus pricing is even.
For most of us, Cresskill real estate is past the bottom and has stabilized. Luxury real estate remains problematic; there is simply too much inventory and so much over pricing to get through. For the heart of the Cresskill market, however, 2011 will be positive. Stability should continue over the next few years; I don’t believe we’ll see any real upward movement before 2013.
What about interest rates? At some point they will have to move higher but are still excellent at around 4.5% On mortgages, the higher loan limits for Fannie, Freddie and FHA are being extended through September 2011 which helps us tremendously.
For the average Cresskill house 2011 will be better as we emerge from the most challenging housing market since the 1930’s.