Million Dollar Housing Market Stays Strong

The real estate fallout hasn't effected the top 10 percent of buyers. Most of the higher end properties are owned by people that haven't had to deal with foreclosure issues. Also, the top end of the population still has plenty of cash reserves and high enough credit scores that the mortgage crunch won't hinder their ability to get loans and make purchases. However, the interest rates have climbed to their highest level in 7 weeks to over 6 percent on 30 year loans. The heightened fear of inflation has the public worrisome the rates may continue to climb. Here is an interesting snippet from today's FAR news and events.


The sweet spot for bargains

Still Celia Chen, director of housing economics at Moody’s Economy.com, said the top 10 percent of the real estate market in terms of home price is doing better than the lower end of the market, which is impacted more by the credit crisis. Prices can be more sticky on the top end because “owners of very high-end homes can wait longer – they don’t have to accept a lowball price,” Chen said.

JoAnn Roberts of Coldwell Banker Residential Real Estate in Pinecrest said million-dollar homes in her area are doing much better than both the lower-priced homes and mansions at the top of the market. She said builders created an oversupply of $3 million to $4 million homes. Contracts are falling through on the lower end of the market because buyers are having trouble qualifying for loans, she said.

The Karsentis say they’re buying now because their family is growing, they love the home, and they know it’s impossible to time the real estate market.

“You can’t help but look over your shoulder and think there might be other opportunities down the road,” he said. “But though it’s difficult to sell at the peak, it’s also difficult to buy at the trough.”

I think the bottom line is, there is never a "perfect" time to buy. If you find the right deal and your ready to make an investment, there is no time like the present for your cash to start earning cash for you.

HG