Tag Archives: Greenwich foreclosures

Say what you will about a strengthening market, Zillow sees the writing on the wall

New division finds and reports on pre-foreclosure and foreclosure properties. interesting stuff.

UPDATE: Looks like it only searches one zip code at a time, so you must select each of the tow’s zip codes, one at a time, to get the whole picture. Here’s Riverside, for instance.

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Greenwich foreclosures

I subscribe to a service, the Warren Group that, for a fee, collects data on foreclosures filed in the land records of three states. It’s a little slow: no data on January foreclosures yet, but it’s useful, so long as you take care to examine what exactly is being foreclosed. For instance, of the 14 foreclosures initiated in Greenwich in December, 11 are lenders foreclosing on their mortgages. Looking at the amount due and making a rough calculation of what these houses are worth today, I doubt any of those 11 are going to remain in the name of their current owner.

The other 3 probably will. 12 Creamer Hill has a foreclosure action against it but it’s been filed by the Greenwich civil engineering firm, Ahneman Kirby LLC, which suggests to me that there is a dispute over what’s owed or at least there’s a sum involved that isn’t large enough to threaten the owner’s continued possession. Similarly, 63 Lismore is a foreclosure brought by a home improvement company. We probably won’t see this on the auction block, just as we won’t the condo at Palmer Point with an association lien being foreclosed on.

Still, that leaves eleven properties that entered the chute in the last month alone. That’s a fair amount of distressed property and owners on those streets where the foreclosures are going on will probably suffer a decrease in their own home’s value.

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J.P. Morgan’s mortgage woes

The bank has a ton of bad mortgages and the situation was not helped by its acquisition of WaMu, which, before it failed, was tossing money around with abandon. If Greenwich is typical, Morgan is moving aggressively to deal with this: most of the foreclosure notices I saw yesterday in Town Hall were filed on behalf of Morgan.

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Foreclosures

It’s a little sad to prowl though sites like Realtytrac.com and see foreclosures on mortgage amounts that, judging just from address and type and size of the house, seem destined to wipe out any equity the owner has. There’s a $650,000 foreclosure coming on a house in Havemeyer, for instance, on a 1200 sq.ft. house. That’s about the full value for a house that size these days, and my guess is we’ll see it bank owned soon. Similarly, a house on Reynwood Road, $2.5 million mortgage debt, is, judging from its tax card description, worth no more than the land it sits on. What’s a 4 acre building site worth these days? Probably $2.5 million. And there are more to come.

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Still crazy after all these years

99 Porchuck Rd

99 Porchuck Rd

A mortgage foreclosure suit seeking $990,000 has been filed against this owner (it’s in The Commercial Record this week, so please don’t write that I am breaching someone’s privacy). Its history is illustrative of our recent land frenzy and demonstrates that wildly over-pricing houses is not a recent phenomenon. This 4 acre lot with a partially-finished, derelict house on it sits down in a hollow off Porchuck and is comprised mostly of stream, wetlands and woods. It was listed for $1.7 million in September 1999 and sold for full price shortly thereafter. In July, 2001, the buyer having apparently changed his mind about building here, listed it for the same price he’d paid for it: $1.7, and sold it in July 2002 for just $1 million. Hate when that happens.

Undaunted by that seller’s experience, the new buyer waited a bit and in November, 2004, relisted it for the astonishing price of $3,800,000 – I checked; that price did not include a new house – and the listed expired in July, 2005, unsold.

So now it’s started down the foreclosure path. I drove by yesterday to see what price I thought it might fetch and I was stumped (a cruel pun, in view of the trees that have buried this land). The original listing claimed that FAR regulations would permit a 12,000 sq.ft. house but was, perhaps wisely, silent on where wetlands would permit you to site such a building. Even assuming that you could find a dry spot large enough to accommodate that kind of house, you’d end up with all house, no yard.

So suppose you wanted to build a more modest house: you’ll still be down off the road in that h0llow. Porchuck is a fine road, but what’s the value of a house built in this bit of damp swampland? $3 million seems a stretch in this market, especially when you can find a new house in a better location for that price. $2 million? Maybe, but no builder would risk even that without a buyer already signed up (in fact, given new stricter credit rules, no builder could build a house here without a buyer signed up). I don’t think a buyer is going to show up in time to save this from foreclosure. If I’m right, it will eventually become the problem child of JP Morgan. There is bound to be some value for this land, but I don’t see JP getting its million back. Maybe $450,000? Maybe. It wouldn’t astonish me, though, if this ended up trading for ten cents on the dollar.

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Why we should streamline foreclosures and get a move on

Several readers have informed me that the owner of 23 West End Avenue and that crazy Victorian on S. Park Avenue, both in Old Greenwich, is stripping them of everything he can before title passes irrevocably to his lender. Stealing appliances from a spec house in foreclosure is a time-honored tradition in the building trade, although usually it’s the unpaid sub-contractors who do the stripping in an attempt to recover something for their labor. But this builder has announced that he intends to take toilets, sinks, baths, window treatments (good riddance to those) and whatever else he thinks may have value. I suppose he’ll get away with this, things being what they are and banks so busy with thousands of other foreclosures but it seems like theft to me: he gave title to the house to the bank when he obtained a mortgage and it’s the bank, not he, who owns those things.

But more germane to the subject: getting inventory off the market, this kind of behavior just mucks up the work. I was going to show that house on Park Avenue, odd design notwithstanding, because at its new price of $1.495, there might be some value there. Now I won’t. I don’t want to get even peripherally involved with some nut case who thinks that the value of a used toilet is worth risking arrest and, even if we were to strike a deal, who knows what would be left in the house at closing? I’ll wait for him to be removed, thank you, and see what happens at the auction, if that ever happens and my client’s still interested.

I also find it telling that the listing broker can’t provide assurance that a bid of the full asking price would be acceptable to whoever holds the loan because, apparently, no one from whatever institution that is will communicate with her. So you’ve got a whack job in possession of the house, threatening to strip it (having already demonstrated a willingness and ability to do just that at 23 West End Avenue), a lender who’s pulling a Garbo, and an uncertain real estate market. Repeat this strange scenario several hundred thousand times across the country and you’ll have some idea of why our current housing market’s in the mess it is. Those areas that were hit hardest earliest – California and Florida, for instance – seem to have streamlined the process of foreclosure and sales in those states are recovering. We need more of that and not a new federal taxpayer-paid program to keep defaulting borrowers in homes they can’t afford. Tomorrow’s TARP announcement, with its promise to spend billions of our money on people like the builder described here, won’t help.

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The bankers are coming, tra la, tra la, the bankers are coming

Banks beginning to foreclose on builders with spotless records. Builders, once prized customers, are now considered risky dead beats by lenders. Non-performing loans that had been being carried in the hope that the market would recover are now being called. I know builders who have never missed a payment in decades of business who can no longer get financing and bankers who had been rolling over builder’s loans who are no longer permitted to do so. The consolidation of banks isn’t going to help – I don’t know if Chase is an independent entity anymore, these days, but you sure aren’t going to find a forgiving heart there the way you might once have at Bailey Savings & Loan. Word on the street is that there are some very, very large loans coming due in two weeks on some very, very large spec houses. You should be able to hear the crash from your living room. 

What will it do to prices if $7 million spec houses get marked down to $3.5? I think you know.

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