Red Hot Real Estate Takes On New Meaning
From the NY Daily News:
Playing with fire
The fire that gutted the Crown Heights brownstone next to mine Saturday morning could easily have killed me and my family, had we been asleep or unlucky. But my wife and I caught an early whiff of the smoke that suddenly began billowing into our home shortly after 10 a.m.
...
But more than just the smoke stinks. Yesterday, a Fire Department spokesman told me the burning of 600 St. Marks Ave. has been classified as arson. No arrests have been made. Investigators should be sure to check city property records, available online at www.nyc.gov, which show the house changed hands three times in less than two years, each time for considerably more than the place was plausibly worth. In February 2004, a longtime owner named Gloria Moore sold the house for $640,000 to a woman named Francillia Ryan, who in turn sold the house to Janet Howard in December 2004 for $790,000.
A few weeks ago, on Dec. 19, the house changed hands yet again, bought by someone named Crispin Booker for $850,000. None of the speculators who flipped the building ever actually lived in the place, a notorious eyesore inhabited by a group of five to 10 regulars. Some tenants collected bottles all day and stashed them in front of the building; others were involved in sketchy transactions that kept a stream of visitors passing in and out at all hours. The Sanitation Department issued more than $1,200 in fines for the bottles and other garbage in front of the house.
The fact that the place was a dump somehow didn't deter loan officers, appraisers and insurance agents from lending higher and higher amounts of money on each flip, until Citibank, according to city records, lent an astronomical $850,000 just weeks ago. No one on the block thought the building was worth anywhere near that much.
Neighbors tell me that an ominous warning was allegedly made to the building's residents the night before the fire to quit the place or else. The rumor gained strength when one of the tenants ran up and down the block as the fire burned, yelling that the blaze was set.
I didn't expect the arson stories to start hitting until owners were significantly underwater and there was no longer any doubts that the housing market had collapsed..
Caveat Emptor,
Grim
Playing with fire
The fire that gutted the Crown Heights brownstone next to mine Saturday morning could easily have killed me and my family, had we been asleep or unlucky. But my wife and I caught an early whiff of the smoke that suddenly began billowing into our home shortly after 10 a.m.
...
But more than just the smoke stinks. Yesterday, a Fire Department spokesman told me the burning of 600 St. Marks Ave. has been classified as arson. No arrests have been made. Investigators should be sure to check city property records, available online at www.nyc.gov, which show the house changed hands three times in less than two years, each time for considerably more than the place was plausibly worth. In February 2004, a longtime owner named Gloria Moore sold the house for $640,000 to a woman named Francillia Ryan, who in turn sold the house to Janet Howard in December 2004 for $790,000.
A few weeks ago, on Dec. 19, the house changed hands yet again, bought by someone named Crispin Booker for $850,000. None of the speculators who flipped the building ever actually lived in the place, a notorious eyesore inhabited by a group of five to 10 regulars. Some tenants collected bottles all day and stashed them in front of the building; others were involved in sketchy transactions that kept a stream of visitors passing in and out at all hours. The Sanitation Department issued more than $1,200 in fines for the bottles and other garbage in front of the house.
The fact that the place was a dump somehow didn't deter loan officers, appraisers and insurance agents from lending higher and higher amounts of money on each flip, until Citibank, according to city records, lent an astronomical $850,000 just weeks ago. No one on the block thought the building was worth anywhere near that much.
Neighbors tell me that an ominous warning was allegedly made to the building's residents the night before the fire to quit the place or else. The rumor gained strength when one of the tenants ran up and down the block as the fire burned, yelling that the blaze was set.
I didn't expect the arson stories to start hitting until owners were significantly underwater and there was no longer any doubts that the housing market had collapsed..
Caveat Emptor,
Grim
10 Comments:
ugh...this really makes my stomach flip and my heart sink.
I went thru a fire a few years back in an attached townhome. I was thinking that, given all the loan defaults,and general regrets of "Why the @$#%^ did I buy this house?", it could spark a lot of fires as away to walk away fom the problem.
Like you, I didn't think they'd start so soon. But when it's obvious the value's tanking I guess the thinking is -Why wait?
And accd'g to your blog, the value's obviously tanking in NJ.
The investigation of this fire needs to be A Number One with the police,insurance co.,etc.there.
Once word gets out that this is one way to get rid of your problem it could catch on.
Fire is nothing to fool around with. Sorry you had one in your neighborhood. Hope the stench of it goes away sooner rather than later. Our neighborhood stunk for what seemed like months.
I really hop this does not catch on. But when you are desperate you might do anything. Is this actually a back door. What I mean is, can you insure for the value of your mortgage?
Catch on?
Talk to the Essex County arson squad and ask them how many cars are burned every week by owners who are upside down on their auto loans?
How do I know? My car was stolen 2 years ago. The car was used for a few days by the thieves until they crashed and burned the car.
I, of course, was the prime suspect in the arson investigation until I proved to the arson squad that I owned the car outright, had no outstanding loans, and was making "enough money".
This was, again of course, more than six months after the car was stolen, simply due to the fact that the arson squad was so backlogged that they simply couldn't keep up.
How do I know? I asked them about it, all the investigator needed to do was point to a large bank of filing cabinets.
If so many people do this on a weekly basis with cars, why would the leap to homes be so difficult? Cars today just don't catch fire that often, however, there sure are alot of ways for a fire to get started in an 80 year old essex county home.
If anyone is interested in some Freakonomics, try plotting the arson rates for areas against the inflation adjusted median home prices..
USFA Arson Fire Statistics
I believe the current numbers stand at somewhere around one third of all home fires are arson, most of them total losses.
Caveat Emptor!
Grim
!!!!!!!!!!
Whoa. That was a scary eye opener.
I stand corrected. I did not realize it was that bad.
Just a heads up, I didn't post this story because I was trying to be an alarmist, but because it was both interesting and local.
Don't expect blocks of homes to start going up in flames. While the numbers are certainly surprising, they are an almost insignificant percentage of the housing stock in the U.S.
I posted this story because it offers insight into the housing market from an entirely different perspective than we are used to.
grim
I live in the Englewood - Englewood Cliffs area of NNJ and there have never been so many home fires, that I can ever recall.
ps: usually a dump to begin with or a property that recently changed hands once or twice.!
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