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Atlantic City Press
12−23−2008
Sales slump stays on other side of tracks
Million-dollar homes still selling well amid downturn in real estate market

The residential real estate market may be dead in the water, but sales of million-dollar homes on the water are holding up quite well.

In Longport, Margate and Ventnor, 51 homes this year sold for more than $1 million – 22 percent of all single –home sales, according to the Multiple Listing Service

“I must have closed five or six sales over a million this month alone,” Margaret Guber-Nulty, an agent with Prudential Fox & Roach in Margate, said Monday.  She has two buyers bidding on a home for more that $2 million.

“The higher end, the waterfront properties, all seem to be insulated from the major hit we took in the middle range,” Lester Argus, president of the Atlantic City & County Board of Realtors, said Monday.  “In the middle range, properties from $350,000 to $650,000, we’ve really seen a drop.”

At the highest end is Achristavest, a Chester, Pa.-based builder of multimillion-dollar homes on the southern New Jersey waterfront and elsewhere.

Achristavest had its best year ever for sales, project manager, Josh McCallen, said last week, which included:

  • A $4 million oceanfront home in Ocean City
  • A $3.1 million bayfront home in Ocean City
  • A $3.2 million condo in Deer Valley, Utah
  • A $7 million home on Nantucket Island, Mass.
  • A $12 million home on Nantucket Island

“And we haven’t dropped our prices much from the list prices that were set three years ago,” McCallen said.

Asked about the company’s success this year, founder and CEO Eustace Mita began, “I must say I’m a little embarrassed to talk about it because the whole market is in an historical slump.”

While Argus suggested that the wealthiest homebuyers might not be as affected by the down economy as others, Mita said that was not his experience.

“I think everybody’s equally hurt.  Our customers are feeling the pain.  If you have a guy making $50,000 and is 401(k) had $100,000, it’s now worth $50,000,” Mita said.  “A person who is buying a $4 million dollar home had maybe a $2 million portfolio, and now it’s worth $1 million.”

A big factor, he said, is that high-end waterfront property is holding its value better that many traditional safe investments.

“They were in the stock market, thinking they’d never see AIG and GM go to zero, and now they have,” Mita said.  “But they’ve never seen oceanfront real estate go to zero, which is why we’re seeing more of them coming back into real estate.”

He said Achristavest’s customers-90percent of whom pay in cash-are very cautious buyers who are looking for high value in the location of the property and all aspects of design and construction.

Southern New Jersey, with its vast beaches of high-grade sand within an easy drive of major cities, is a gem – even compared with the Mediterranean waterfront and Hawaii, Mita said.  It has helped draw buyers such as Dennis DiFlorio, former chairman of Commerce Bank, and Rich Gannon, who won a Super Bowl as quarterback of the Oakland Raiders and now is a game analyst for CBS.

Bob Edelheit, who bought the $4 million home at Santa Rosa in Ocean City, has actually been helped by the economic downturn.  His company, employee benefits administrator United Group Programs of Boca Rata, Fla., is doing significantly better, he said Monday.

“Downturns enhance our business,” he said.  “People who may not have been concerned about the cost of employee benefits packages now come to us because they have to save money.”

Edelheit said he searched for 21/2 years before finding Achristavest’s Santa Rosa.

“We like many things European, and we had been looking at homes all through the area.  The minute we opened the door we knew it was ours,” he said.  “The workmanship, the way it’s been designed, the quality of the materials.  It has an atmosphere as if it’s something out of Tuscany or the south of France.  It was everything we like.”

Achristavest’s goal in making homes for such buyers is that no two will ever be alike, Mita said.

Every significant feature of the company’s $6.9 million Port Pelham home on the ocean in Longport is custom-made from the flooring with 100-year-old boards to the white marble kitchen countertops and sink.

Designer Jon Simmonds crafted many of the home’s elements and furnishings, working in wood, stone and stained glass.

At the oceanfront Santa Rosa in Ocean City, the partner to the home that just sold for $4 million has two features not found next door: a fireplace in the master bath and a bar in the living room.  Each home has an elevator, and each bedroom is treated like a suite with its own bath executed in various stone styles and metals.

Achristavest’s biggest project at the shore is taking shape in the Diamond Beach section of Lower Township where it is building a $600 million condominium resort community that Mita is confident will be impressive.

And having thrived in the down part of the real estate cycle, Achristavest and other high-end builders look forward to what they can do in an improved market.

“The scarcity of the land will help maintain the value of ocean and bayfront properties,” Mita said.  “Thre are 18 million people within a two-hour drive of the Jersey shore, so if you’re building a good product, you’re going to be successful.”



 
   

 
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