Report: Subprime Foreclosures Rampant in Brooklyn
On Friday the Federal Reserve Bank of New York released data listing how many subprime loans there were in New York state in October (broken down by zip code) and how many of those loans were in foreclosure. Bottom line? Bad news for Brooklyn, especially in the zip codes that include Crown Heights, Bedford-Stuyvesant, East…
On Friday the Federal Reserve Bank of New York released data listing how many subprime loans there were in New York state in October (broken down by zip code) and how many of those loans were in foreclosure. Bottom line? Bad news for Brooklyn, especially in the zip codes that include Crown Heights, Bedford-Stuyvesant, East New York, Williamsburg, and Bushwick. As reported in the Daily News, there were foreclosure proceedings under way for 25 percent of homeowners with subprime mortgages in 11233, which covers Bedford-Stuyvesant and Crown Heights. That subprime foreclosure rate is almost four times the national average of 6.89 percent. As the chart above shows, subprime foreclosure rates were also high in other Bed-Stuy/Crown Heights codes (11212, 11213, 11216, and 11238). The data also shows that 435 homes with subprime loans in East New York were in foreclosure. Foreclosure rates on properties in the zip codes covering Williamsburg and Bushwick, meanwhile, were also high (though the total number of subprime loans in those Zips was smaller than in Bed-Stuy, Crown Heights and East New York): 22 percent of homes with subprime loans in the 11221 Zip code were in foreclosure.
Brooklyn Neighborhoods Top Subprime Foreclosures in Nation [NY Daily News]
New York Fed Releases Zip Code Level Data on Nonprime Mortgages [NY Fed]
Many of the foreclosure homes in BS and CH are investment properties. Many of the owners do not leave in the area at all…
Many of the foreclosure homes in BS and CH are investment properties. Many of the owners do not leave in the area at all…
Brooklynnative – You also have to consider condo’s and coop’s that may have 10 or 20 mortgages in 1 building.
I think in general though, it is fair to day that the actual number of subprime loans is relatively small compared to the number of overall loans. The Media is definately over-blowing and skewing this whole scenario with statistics…
Its alarming to say 20% of all subprime mortgages are defaulting, but if you mention only 5% of loans are subprime, that is quite another thing.
The media are whores. They play no role at all like the founding fathers intended. They don’t reveal the truth to keep the powerful in check. They bend the truth, they create news where there isn’t any, and they exaggerate and whip everyone into hysteria to sell sell sell and make money money money.
Thank God for Jon Stewart. He is literally the only person calling out the media on their idiocy.
12:28, you can’t compare the number of foreclosures with the total number of people. You have to compare it to the number of buildings. If the owner of a 4 unit building with 20 people living in it goes into foreclosure, everyone in the building will feel the reprucssions.
the media is destroying the world.
There are about 55,000 people living in 11216. Out of 460 subprime loans, 15.7% are in foreclosure, or around 72 mortgages. One for every 764 people. I don’t know how many households that means, and I don’t know if that’s more than normal, but it doesn’t seem like a lot. Maybe it’s enough to push the market from insane prices to kind-of-insane prices. I don’t know.
Keep in mind that alot of the foreclosures reported are from people betting on the market. Bed Stuy and the other neighborhoods in questions had historically lower priced housing thus a low barrier to entry for those looking to make a quicker buck. Many were using sub-prime mortgages to hedge their risk. It shouldn’t be a determinant of the neighborhood.
Play it smart and there can be opportunities. Our “fringe” neighborhood house increased in value 20% over the last year alone, between buying it under market, then adding value via our improvements and the general revival of the neighborhood which has continued steadily despite the slower market. If the market drops the house is still worth more than we purchased it for. Though we’d probably just barely get what what we put into it for renovations. What’s important is not going nuts overspending on renovations. And look for good deals. Don’t leap to make an offer if nobody has made an offer yet. Hang tight and just watch the situation. The seller might drop the price. The inventory for houses is dismal though, that’s what stinks about looking to buy right now.