The rich and famous get burned by the property bust

Celebrities have also felt the forbidding pinch of the financial crisis gripping middle-income homeowners as some are actually selling their property at a loss if not completely losing them as foreclosed assets.

 

According to reports some of the rich and famous blamed financial mismanagement or  poor judgment of investments that made them lose millions of dollars of their earnings.

 

Celebrities Selling at a Loss:

 

Robert de Niro. The actor, best-known for his roles in films “Raging Bull” and “Taxi Driver” has been known for his extensive property investments in New York. He is now selling his 19th century townhouse at 14 Saint Luke's Place, which according to documents was purchased back in 1975.

Priced earlier this year at $14 million, the property is now auctioned  for $11.995 million, a report from the NY Daily News revealed.   

 

Mr De Niro’s five-storey, 22-foot-wide property, which was home to poet Marianne Moore during the 1920s, is on one of the West Village's most storied and coveted blocks, between Hudson Street and 7th Avenue.

 

Sharon Stone. Another Hollywood A-lister, brought to fame by her role as the sultry psycho killer in “Basic Instinct” has also moved to sell her L.A. property for $8.995 million, although she purchased the property in 2006 for $10.995 million, according to World Property Channel.

 

The gated, Mediterranean style estate, sits in five acres replete with bridges, waterfalls, fruit trees, a meditation garden, a swimming pool and a tennis court with viewing pavilion, the report described.

 

Sylvester Stallone. The actor known for his roles in “Rambo” and “Rocky” had also parted from his 1.75-acre property in Thousand Oaks, California, which is a vintage lakefront home retreat that has a boathouse, guest quarters, and caretakers’ quarters as amenities.

 

Mr. Stallone acquired the property in 2008 for $4.85 million and is selling it for $4.495 million, public records said.

 

Celebrities with Foreclosed Assets

 

Nicholas Cage. Premiere actor Nicholas Cage lost his $35-million LA property to foreclosure. Citibank, early this year, confiscated this property located in Copa de Oro Road, Los Angeles, California because a financial manager’s mismanagement.

 

Mr. Cage, according to Forbes.com, was forced to sell four properties in order to pay tens of millions owed in government taxes.

 

Julius “Dr.J” Erving. The famed basketball player of the NBA lost his property in St. George, Utah after failing to sell it for $2.25 million in 2009.  He moved to Atlanta and in 2010 creditors begun the foreclosure process. Last autumn, he defaulted on his payments on his loans on the mansion forcing the bank to confiscate the property.

 

Sources: Forbes.com and World Property Channel

Analysts: Market Recovery On the Horizon But Will Vary by Location

With about 800,000 REOs and about 1 million properties in some stage of default, according to Rick Sharga, EVP of Carrington Mortgage Holdings, it is difficult to see the light at the end of the tunnel.

However, that is just what a group of four analysts – including Sharga – tried to do at a panel Monday at the Five Star MPact Mortgage Banking Conference and Expo.
“In every previous recession, housing has brought us out of the recession,” Sharga said, but in this recession, “it dragged us in.” As a result, he says, recovery this time will be a bit different.
“Inventory continues to outpace sales,” Sharga said, and as long as this is the case, the market cannot recover.
However, Eugenio Aleman, director and senior economist at Wells Fargo, pointed out that the economy is growing – though the pace remains slow.

Unemployment remains high, but the economy is adding jobs – slowly.
“In 10 years, we’ll be saying, ‘Why didn’t we buy a house today?’” said Aleman. “This is the best time to buy.”
While Aleman does not know for sure when interest rates and prices will rise, he is certain they will.
According to Sharga, foreclosures should have peaked this year, and recovery should have started in the coming year. However, foreclosure delays due to robo-signing have hindered this process.
Ultimately, market recovery will depend on a number of variables and differ greatly by locale, according to Eric Fox, VP of statistical and economic modeling for Veros Real Estate Solutions.
For example, in the New York metropolitan area, a projection about 12 months ago saw the market falling 3 percent, but this rate came with a 13 percent spread, depending on the type of property and neighborhood, Fox said.
Local variables contributing to and detracting from market recovery include price-to-rent ratio, population trends, affordability, school districts, and more.
Another factor contributing to market recovery is whether a state is a judicial or non-judicial state. Kostya Gradushy cites data predicting it will take eight years to clear the foreclosure inventory in judicial states and three years in non-judicial states.
(DSNews.com)