The Winter of Foreclosures in Southampton Village Is Biting Cold
The winter of foreclosures in Southampton Village is biting cold. It is the summer retreat for the moneyed class of New York. But here too foreclosures are making its presence felt with sale signs posted on driveways.
One house on Osborne Avenue is suffering this sign for 8 long years. Poring through the records of this house one can trace the pattern of the ups and downs of this dizzy decade. In 2001 it was purchased for $460,000. Two years later the price went up to $850,000. In 2006 after having been renovated the house asked for a price tag of $1.65 million. The present owners of the estate are a couple from Manhattan. They put the house up for sale asking fro $2.2 million.
By that time the bubble had already started to bust but there were no signs of it here – the happy playgrounds of the rich and famous of Wall Street. All that happened in Florida and California. If one could afford a house here then that person was definitely class.
But Southampton did not remain immune to the crisis as one by one heads began to roll – Bear Stearns, Fannie Mae, Freddie Mac, Lehman Brothers and now Madoff. One horrific tale followed another. The fortunes of Wall Street plunged. This area in Southampton began to mirror the happenings played out at Wall Street. Average price has fallen by 10% but that only hints at the gravity of the trouble because nothing is moving.
In East Hampton sales in 2008 dropped by 25%, 39% in Bridgehampton, 47% in Montauk and 45% in Southampton. The real collapse took place last autumn. Investment bankers found themselves unemployed and lawyers doing work with the corporate sector found that their client base had vanished. The situation was pathetic for hedge fund managers. Till now they were hailed as geniuses but now Congressional committees were hauling them up. Herb Phillip a veteran real estate broker said, “Until the market improves or their mental state improves, they’re not buying anything. It’s dead”
Winter has always been a meek season with empty restaurants and streets without cars. A cold wind whips in from the Atlantic. The house on Osborne Avenue with its nautical décor of mermaids and a cottage for guests was begging to be sold for $1.85 million. The following week it is expected to plummet to $50,000!
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