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The 1% Also Don't Pay Their Bills: 10 Ultra Luxury Properties In Foreclosure
As we reported yesterday, something odd is happening in the US, which supposedly is deep in a "housing market and economic recovery" - foreclosures on ultraluxury homes, those worth $5 million and over, have soared by 61% in 2013 (even as overall foreclosures continue to decline due to the well-known and much discussed "foreclosure stuffing" process, which means millions of properties are held in bank shadow inventory just waiting for the moment to be unleashed and end the implicitly home price subsidy abused by banks for the past three years). Granted, the overall sample is relatively small, with fewer than 200 properties in the ultraluxury category compared to 1.2 million for all properties tracked, but as RealtyTrac notes, "each of these high-value properties represents a much bigger potential loss for the foreclosing lender compared to a median priced property."
Additional thoughts from RealtyTrac:
This trend may indicate lenders are now financially stable enough to more comfortably weather the big-ticket losses that these properties potentially represent. In addition, an improving housing market means more prospective buyers, even for these ultra high-end homes. A bigger buyer pool translates into higher sales prices on these properties, allowing lenders to recoup more of their losses on these jumbo loans gone bad.
"A home selling for $5 million or above represents the ultra-luxury end of the market, and so far in 2013 we’ve had 34 properties close over that price with the average sale being $7.7 million,” said Emmett Laffey, CEO of Laffey Fine Home International, covering the five boroughs of New York. “Any foreclosure properties in this type of ultra-luxury market usually get purchased very quickly since there is one thing all super rich buyers want – an outstanding deal on a real estate transaction, and in most cases foreclosures of this magnitude come with several million more dollars of built-in value.”
Regardless of the arbitrage opportunities available to "all cash" buyers, who would be happy to park some cash in real estate, the fact that ultraluxury foreclosures are soaring also means that even the "1%" is starting to succumb to reality and beginning to feel the pressure of a financial reality in which only the "too biggest" can never fail.
So what are the properties in question? The photo gallery below, courtesy of RealtyTrac, shows just where any given $5 million + property stopped making its mortgage payments.
MONTAGE, IRVINE, CA 92614
This home nestled on a bluff overlooking the ocean was listed for sale at $15.9 million but the foreclosure judgment amount at the foreclosure auction scheduled in November was $12.8 million.
PACIFIC COAST HWY, MALIBU, CA 90265
This foreclosure auction property is located right on the water on Pacific Coast Highway in Malibu. It features two detached units and was listed for $9.5 million, but the opening bid at the foreclosure auction in November was $8.8 million.
CUESTA LINDA, PACIFIC PALISADES, CA 90272
Built in 1990, this 5 bed, 6 bath estate was scheduled for foreclosure auction in November with an opening bid of $4.1 million, although the assessed value of the property is $5.5 million.
KIMRIDGE RD, BEVERLY HILLS, CA 90210
This beautifully remodeled 5 bed, 7 bath estate was scheduled for foreclosure auction in October with a foreclosure judgment amount of $7.5 million. The grounds feature panoramic views of the ocean, a putting green, and stunning pool area.
COLONY VIEW CIR, MALIBU, CA 90265
A beach lover's dream! This pre-foreclosed, 5 bed, 5.5 bath single-family residence was custom built in 2001. A Notice of Default was filed in October with a default amount of $200,000, meaning the owner was behind that amount on mortgage payments.
BUSCH DR, MALIBU, CA 90265
This pre-foreclosed French Country hillside residence features 6 beds, 7 baths and sits on 8 acres.A Notice of Default was filed on this property in June, and at that time the homeowner was an estimated $125,000 behind on mortgage payments.
S OCEAN BLVD, DELRAY BEACH, FL 33483
Listed for sale at $13.5 million, this exquisite single-family residence in Florida is in the first stage of foreclosure. A dramatic and elegant floor plan makes this 6 bed, 9.5 bath home perfect for entertaining. The initial foreclosure notice was filed in July.
SANCTUARY DR, BOCA RATON, FL 33431
Beautiful single-family "sanctuary" in pre-foreclosure. It features 5 beds, 10 baths and has a fantastic pool and patio area with tranquil views. The pre-foreclosure notice was filed in September with an estimated total outstanding loan balance of $8.1 million.
SEA RIDGE DR, LA JOLLA, CA 92037
This 5 bed, 4.5 bath fully-furnished home was scheduled for foreclosure auction in November with an estimated total outstanding loan balance of $5.5 million. It features remarkable panoramic views and is located near many of La Jolla's unique shops.
ARROWWOOD CIR, HOUSTON, TX 77063
This bank-owned property was repossessed by the bank via foreclosure back in April 2013 for an estimated $6.3 million. It features 8 bedrooms, 13 baths and is situated on over 23,000 sq/ft.
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I'll take the Delray Beach !!
But does it have an indoor gun range??
At least 50 yards, for my revolver practice.
Oops.. Am I bragging a little??
You might want to quit worrying about long distance revolver shots and work on your 30 round clip ARs......because that house won't be a "chick magnet" but a "chit magnet" when the peeps come calling........keep the revolver though.......you can put it to use before they get a hold of you......because they will want to spend some time working on you for what you have hidden.......
"But don't for one second think that home ownership is all sunshine, rainbows, and ice cream sandwiches. There are serious trade-offs that you should know, understand, and accept before signing on the dotted line." (Motley Fool)
Moar from MF:
1. Mortgage debt -- a marriage you can't divorce
According to the Census Bureau, the average home price in 2010 was $272,900. A traditional mortgage will finance 80% of that, or just over $218,000. At the same time, the Census Bureau also reported that median household income in the U.S. was just over $51,000.
Are you comfortable owing over four times your total gross income (before taxes, mind you)?
Full article:
http://www.fool.com/investing/general/2013/12/08/dont-buy-a-house-until-...
Hold on- isn't that one in Boca the place where that kid went high-end squatting a few months back? That looks AWFULLY familiar for some reason.
I think these people realize better to get out now, than deal with a "buyers" market when interest rates rocket...
Currently sitting just under 3% on the ten year, could get ugly real fast.
the 10 year the 10 year the 10 year...all this fuss over the 10 y....OMG holy mfing she ite, the fing 10 year...
last time (way back in September this year) it almost touched 3% the world almost fell apart.
This is going to be the best interlude before the finale of all time...watching Ben deal with the rising rates. I think he thought he was going to get out before it fell apart again, but nope, Ben can't even whisper the word taper and he'll look pretty silly announcing QE...what is it 6 now....but what is a central banker facing reality to do?
Yes, this is the one thing I will watch closely. We already have a few non voting members suggesting that 'sooner or later' taper must happen. Not Ben though. If he says it the rates go over 3% and Morgan Stanley sets off the chain reaction. If he increases QE the whole world knows it is really over for the dollar.
Who knows, maybe an asteroid will impact Earth and folks will have their attention diverted, otherwise...this will be good!
Oh, then I guess you really do need customers if you want a business that makes you rich.
You know "they" don't like you any more when you get the foreclosure notice. "But I thought I was on the inside."
... and ...
"But why would I worry about a 5% increase in debt when the value of the property goes up by 10%?"
I'm guessing these were the houses that weren't bought with laundered drug money?
Or maybe, after all costs are taken into account, it turns out you lose less money by keeping it in a, a, b-b-b-bank?
Too much fun; too many boring friends. Shut it down.
Yes. But for the 1% it's just a 'bidness' decision and not a question of morals.
<Laws Morals are for the little people.>
And we manage to do it with smaller brains. What elegance.
No room for my fucking horses at any of those places...pass.
Only a couple of them would survive the Great Tsunamis of 2014. If you want beach front try Wichita.
Exactly what we were thinking. At least they'll have a nice view of their last few seconds on earth.
"my fucking horses"
Isn't that illegal?
Not in California if the horse claims to be "trans-species".
if you like fucking horses, you can keep fucking horses.
That would be "fucking my horses" not "my fucking horses".
"That would be "fucking my horses" not "my fucking horses"."
Tomato tomahto. Gitty-down cowboy...
One of them said 8+ acres. You must have a lot of horses!
Yeah, that's how the 0.1% gets fancy property on the cheap: Drive other sharks onto the blades of cashflow crisis.
How'd you think old man Bush got his Texas ranch all those decades ago? There is little honor, even among vampires, sharks and snakes.
Malibu, too much my man!
Looks like a fucking double-wide, albeit with the deluxe greatroom package.
I'd sell mine for half that.
My first thought was that one Malibu joint looks like a fucking mobile home with big windows
Crash and burn
the stars explode tonight
How'd you get so desperate?
How'd you stay alive?
Help me, please, burn the sorrow from your eyes
Oh come on be alive again
Don't lay down and die
Hey, hey
You know what to do
Oh baby drive away, to Malibu
Hole, Malibu
And everybody knows that you're in trouble
Everybody knows what you've been through
From the bloody cross on top of calvary
To the beach of malibu
Everybody knows it's coming apart
Take one last look at this sacred heart
Before it blows
And everybody knows...
Everybody Knows, Leonard Cohen
Looks like the Beverly Hillbillies decided their old shack was home sweet home after all...
Better get em sold before fukushima washes up.
I would love to go to Pelosi's vineyards in Nor Cal and piss Fukushima Iodine 131 and Cesium 137 on her vineyards.
Then salt the damn soil so nothing would grow there.
mmmmh Pelosi's not going to be around forever. why not piss on her instead? (just a suggestion)
Au @ 55K
Ag @ 1000
I'll be able to buy any property on that list! But I won't 'cause I'm not a narcissistic moron.
Nope, a farm or apartment building or 3, for me.
The thing is......if PM's go up to the prices you post then RE will most likely be a lot more expensive as well.
PM's are for wealth preservation, not appreciation.
PM's are for people that want to ensure that their intrinsic value mantra stays alive in their head.
You can only make bowls and spoons with it. You can't even divide it effectively wihtout ruining the value of the bar.
Gold, while it has useful attributes, is not a panacea.
"You can only make bowls and spoons with it."
Too funny. My nose ring is made of Gold. So there! :)
Good for you. What a great example of intrinsic value.
Agree CD; the winners will be those who lose the least.
Hold some productive assets, have low debt, and diversify.
The reset is in slow motion due to monetary policy.
The expanded social safety net since the 1930's masks the soup lines. People have no visual cue to prepare. As a result, most will be less-prepared than the last time.
Unless Keynesian magic really works, digital printing will continue to the point of currency failure, over-printing being a form of counterfeiting.
We probably will see rates continue to creep up as control is lost. Then more controls or devaluation are attempted as the final stutter-step before the market cleans up the mess itself.
Now, if only I could afford some productive assets. Maybe I'll borrow some money ...
If you can't afford the productive asset, become the productive asset.
Tried that. There's no money in it. Should I work harder, smarter or be more innovative?
The medium term future isn't about money, it is about the essentials of life. Gardening, that type of thing. I hear you though. Individual autonomy threatens the mega corporate Titans and, as such, the individual is the main target of this Art of WAr operation to subjugate humanity.
Hey, everyone check out the new GoldFiatLeak.com site, where you can watch millions of dollars of gold exchange hands every day in realtime, using the largest decentralized value exchange network known to man.
nice jugs
Just a tit
Sheeit, what do the utilities, insurance, property tax, housekeeping, cleaning, gardening and used diaphragm removal from the pool filters cost in these palaces on top of the mortgage payments ?
You have to have a few plantations and extortion rackets to be eligible to bid on these.
Haha that's for the PA to take care of, silly. The master need not worry about any of that... until he does [and the property is foreclosed].
My old house was on a street with some houses a bit smaller than the one in Boca Raton. These places are expensive to maintain. These people easily drop $30,000 a year in maint for pool, grass, painting, cleaning and upkeep. Anything near the ocean will also rust out or oxidize metal fixtures outside like lights, door locks and handles.
Then you have the property taxes. I would guess everyone of these houses is WAY over $100 K a year. The electrical bills in Florida in the summer will run $1,000 a month easy. I am glad I am in Montana with my rocket fire heater. I can go outside and shoot .308 1,000 yards down the field.
Nice that Tyler's have a banner add for bigger breast cream. Can go to a C Cup in weeks. I heard for guys you can just smoke pot if you want Moobs and alsop THC insanity.
lol these kinds places need at least one full-time caretaker for upkeep - 50 out of the 100K goes right there.
p.s. it's not the pot that gives you moobs - it's the box of cookies ja eat after. ;)
+1 LOL! Cookiees.
These places do require a full time caretaker. I saw a few slip into foreclosure and they can get really run down and shitty fast. You would be amazed at how fast it can happen especially if there is no A/C running in the house.
And back in the day - I used to remember these words that you probably heard more than a few times.
"You can't ride that skateboard here!" I had a Bahne back in the those days.
Yeah, I been to some rich places that told me that haha. I totally know how some high-end properties, especially ones with lots of gardening maintenance, go to shit without A/C and constant upkeep.
It totally makes sense to have that kind of house if you have a generational family and you own a business and employ people without being a douche, etc. I've seen some good people in fancy places pull it off alright.
Yep, I'll bet the local politicians LOVE to tax the shit out of these big McMansions!
I recall someone here having posted a link (a long while ago), showing which top Celebs have sold or are selling their places in L.A. area. E.g, Jim Carrey, Celine Dion.
Clearly they are/were the more level-headed type and had good financial advice.
they are abandoning the Fukushima coast. early birds etc
Just more smart people getting out of Kalifornication before it completely crumbles under the growing load of moronic legislation.
Californication [Rest in Peace]. NYC is not far behind..
With the excess capacity in toilets vs bedrooms these houses all seem to have maybe they should be renting them out as public toilets. Pee like Justin Bieber for a low introductory price of only only $19.95.
LOL! Yeah - I never get why you need 5 bedrooms and 10 bathrooms. Is this for all your degenerite rich friends to do coke or freebase in the bathroom at your parties.
The rich are different from you and me. They are incontinent.
Something is really wrong here. When someone is let's say $200,000 behind on a $5 million loan, that means they are behind by over 16 months if the interest rate is 3%. The real question is how many of these luxury loans are behind by 6 months.
all of them.......Taper MBS.......NEVER !!!!!!!!!!!
Most of them are in So Cal - so hopefully they are Hollywood or TV scumbags getting hosed. F Hollywood and TV. Hopefully these coke head douchebags are suffering.
My local 16 or 18 Movie Plex has been empty a lot anymore - day and night. They send out coupons. LOL! F Hollywood because they invented and totally support Obama. Starve the Beast.
I like the way U think
Why pay for gas, fight traffic, have to pay way overinflated prices on concession, then watch the movie with a bunch of noisey thug wannabe's?
I just download movies that I want to see on bittorrent and watch them at home!
The part I really like is that I'm not putting money in the pocket of one of the parasites in Sheenywood!
+1 Bro. Totally agree.
Understood. But don't forget that Hollywood also supports its own creations: Reagan, Schwarzenegger. The H/wood Elite are cousins to the NY Elite. They're just doing their part, depending on which side of the coin is face up.
Which is why I don't fall for the false choices of Left vs. Right in politics or Hollywood. All are false choices, false flags. They're merely FOCs (Flags Of Convenience), and "Flystrips" to attract & trap "Identifiable Segments".
When you run (create or infiltrate and take over) these Segments, you control everything. Those who fall between the cracks are mopped up, if they cannot be redirected to one of the false Choices and cause too much grief.
Call me Cynical, not Paranoid. Cause I don't think that they are out to get us. Rather, they're just out to 'use' and manage us -- like Chattel. It's the efficient and rational (cold-blooded, dispassionate, calculated) thing to do. What's that famous American saying? Ah yes... "It's nothing personal, it's just 'business'.
Reality can be suspended. The carried value of these properties were purposefully distorted until the lender could "weather" fair value. This is stated matter-of-factly in the article, but it is fraud and should be denounced as such.
Tax is for little people, said a famous American heiress/zionist.
CONgress agrees as it exempts itself from many laws which it imposes on the many, for the profit of the few.
Why pay when you know you can 'just walk away' and dump the losses onto the guy down the street ... and in 2-3 years buy another McMansion with the new American method of financing.... No-Money-Down, Never-Pay-Back mortgage.
who was that statist cocksucker who said a few years ago, that its not morally right........LOL !!!!
Remember how the Mortgage Bankers Association strategically defaulted on their HQ building after their CEO blathered something similar?
http://dailybail.com/home/must-see-bust-mortgage-bankers-association-strategic-default.html
Creative destruction! Now the note holder will get to bail-in depositors and bond holders. The giant credit sink hole will swallow up everybody's cash.
Fed miscalculated just how much printing was required for this pig. Guess we gonna need a bigger printing press
Strategic default, bitchez. Now they can afford a bigger haus.
Need more bling bling. Amerka's homes- Trailer Parks.. Ask KKR
This is fucked up
Blackstone Made Money on Credit-Default Swaps With This One Weird Trickhttp://www.bloomberg.com/news/2013-12-05/blackstone-made-money-on-credit...
Bring spray paint, sledgehammers, and Bud Light. Together we can lower the values.
has anyone tested non-recourse on refi loans in Cali?
JUST LOOK AT THE ZILLOW ON THEM, MOST IF NOT ALL THESE HOME THE OWNERS TRIED TO GET 2 to 3 X WHAT THAY PAID FOR AND THE TAXED RATE , MAKE YOU THINK WHY NOT JUST SEEL AT A MORE REASONABLE PRICE ? THIS GUY WOULD RTAHER GO FC THEN ADMIT HIS PROPRTY WAS NOT WORTH 13 MILLION AS HE TOLD OTHERS. OR MAYBE HE TOOK A HALC AND SQUANDERED THE MONEY?
http://www.zillow.com/homedetails/717-S-Ocean-Blvd-Delray-Beach-FL-33483...
He may have done some imporvements too. $160,000+ a year in property taxes. Ouch! Oceanfront. Maintenance nightmare. Almost anything metal outside has to be replaced almost every year.
The one in Houston is another gem. Probably one of the worst places for a foreclosed home due to searing heat and high humidity. There is plenty of energy money there so someone will buy that one at a lower prices.
Its too expensive to be rich.
The property taxes alone could wipe someone out on these properties.
Statism and banksters are the number one thing preventing 200,000,000 Americans from living like rockstars
But but but cash buyers will soak up the foreclosures in no time.
When Monti bowed to banksters
http://failedevolution.blogspot.gr/2013/12/when-monti-bowed-to-banksters...
Investing in your own inflated ego and greed rarely works out well. Even more embarrassing is how many of these ultra-properties are owned by so-called real estate professionals. But, these examples shown are nothing compared to the uber white elephant catastrophes which only Donald Trump or some other asshole with an ego even bigger than his would ever consider buying.
By the way, does Stevie Cohen still own his 60,000 square foot playland in Connecticut? I bet it’s a real hoot wandering the halls of that complex these days. Maybe he should write a book about how much fun it is to bowl alone in your own private indoor alley. No need to send him off to prison, they’ll probably just turn it into one some day.
I wonder what percentages of these foreclosures were due to mortgage payment failures and how many were due to bankruptcies. Really expensive properties are generally purchased for cash. Really premier properties are also generally owned by scoundrels and ponzi schemers. I have it from a friend at the Sheriffs office that they serve about a dozen warrants a week in a very expensive area of town hear here.
Honey...we left the lights on in Malibu... Have Curtis take the Lear out and shut them off..we really should get one of those remote thingys, you know the kind that work on the iPhone...
Wonder if 10050 Cielo Drive is in foreclosure?
Do any of these really qualify as "ultra-luxury"?
The prices seem far too low, I suspect a lot of these are walkaways - the "buyer" took out a $20m loan during the bubble, the market crashed, and now they'd rather walk away from even a $4m down than sell for $10m. And if they got the property with zero down, well, awaaay we go!
Remember, something like half the "buyers" at the end of 2007 and thereabouts never made even the first payment on their mortgages because THEY NEVER INTENDED TO.
WTF 8 Bedrooms, 13 Bathrooms. Why?
Whoever buys a $5+ miliion house with a mortgage is not rich, just a wannabe. Retards.