We can always count on the New York Post for thoughtful, contemplative analysis: The latest such example is the increasing issue of foreclosures in the Hamptons:
"Homeowners in the some of the toniest ZIP codes in the Hamptons are facing a
frightening reality – they can’t afford to foot the bill for their high-priced
homes, The Post has learned.
In the first three months of this year, banks have launched preliminary
foreclosure actions – known as lis pendens proceedings – against a record 120
borrowers in East Hampton and Southampton towns.
Twenty percent of those borrowers live in homes that are worth more than $1
million, according to figures from the Suffolk County clerk. And the list gets longer every week."
Now before you get too concerned, understand that a total of 10 homes have actually gone into foreclosure. A lis pendens action is merely a claim or suit filed against real estate (usually regarding title or ownership). In a beach community like the Hamptons, some of these could easily be absentee owners’ errors or oversights. I would have liked to see the lis pendens data for teach of the past 10 years.
What is somewhat unusual are some of the biggers busts, like this $15 million Westhampton chateau pictured above. Real estate brokers interviewed in the article seem to be split: Some note the "high-end sector remains strong," and that "doomsday predictions were premature." Others are are bracing for the impact of Wall Street layoffs:
"Corcoran broker Susan Breitenbach said young Wall Streeters who gobbled up
trophy properties in recent years are starting to suffer. She recalled getting
calls from Bear Stearns employees desperate to unload their East End homes after
the company’s recent implosion. "These are people who are used to success," Brady said. "There is a level of
denial and embarrassment when I have to call [people] to ask about mortgage
Another top-selling East End broker who spoke anonymously said the area was
bracing for fallout from impending Wall Street layoffs. "That wave hasn’t even hit yet," he said. "A lot of them who bought second
homes are already trying to shed them. You’ll always have the super-rich who can make moves out here no matter
what," the broker said. "But I think there’s a dose of reality on the way."
Well, we will find out soon enough . . .
TROUBLE IN LI PARADISE
FORECLOSURES LOOMING FOR THE HAMPTONS’ POSHEST PADS
NYPost, May 12, 2008 —