Celebs Not Immune To Foreclosure

Real Estate Crunch Hits Everybody, Even High-Profile Entertainers

(AP) 

But as celebrity real estate columns like "Hot Property" in the Los Angeles Times and "Gimme Shelter" in the New York Post show, other stars can't command the same prices for their homes that they might have been able to a few years ago.

The price of Angela Bassett and Courtney B. Vance's house has dropped more than $2 million in the past year. The French Colonial in a gated section of Los Angeles' old-money Hancock Park neighborhood has five bedrooms, seven and a half bathrooms, a gym, a hair salon and a two-story guest house. An agent listed it last year for $5,999,000, then a month later took it off the market for seven months. Then June Ahn of Coldwell Banker got the house and listed it for $4,999,000; she reduced it soon afterward to $4.6 million, and now has reduced it again to $3.9 million.

"It was overpriced," Ahn said. "The price difference from $5,999,000 to $3.9 (million), obviously we'll have a bigger number of buyers that can afford to get into it and even take a look at it."

It helps that the husband and wife, who bought the house 17 years ago for about $1.8 million, own it outright. "They're very flexible, they just go with the flow of the market," Ahn said. "Unfortunately, this happens. Last year was better than this year. Now they realize they didn't reduce in time. They were hoping to get the best (price) last year but it didn't happen so they learned the lesson."

Then again, property values can be a matter of perspective, says Ed Kaminsky, a Manhattan Beach, Calif.-based real estate agent who helps professional athletes relocate.

"You've got the new guys with the big contracts that are excited about the $8 million check they just got and they want to spend some, and I'd say rightfully so. Sometimes it's not a smart investment and sometimes it is," he said. "But if you make $8 million a year and you blow $5 million on a house and you sell it for $3 million a few years later, is it really wrong?

"What I try to do is identify what is it that they want, and let them know that it is possible that they could buy a home for a lot of money and sell it for less than they paid for it, and are you OK with it?" he added. "If I handed you $25 million right now, would you think differently about the $2 million house that's down the street? You may not really care that it's 50 grand overpriced 'cause you like the swing set in the backyard for your kids."

The primary element driving where a celebrity chooses to live is privacy, said Jordan Cohen of Re/Max, who has represented more than 50 stars and athletes in real estate transactions, including Shaquille O'Neal and Marilyn Manson. He's now selling actress Joely Fisher's house - a four-bed, seven-bath, mid-century craftsman at the end of a secluded drive with a pool and a screening room - for $3,295,000, about $1 million less than the asking price when another agent first listed it last summer.

He believes a star's property can bring in more money than a regular house.

"I know it adds value," said Cohen, sitting on a limestone countertop in the kitchen of the suburban Encino home. "A good analogy would be, shoe companies pay athletes millions of dollars to wear a specific shoe so you'll have young America buy that shoe because a celebrity endorses it. It's the same thing with a house."

"Why does anyone read Hot Tracks in People magazine or any other publication?" he continued. "I've never understood that, because they're just, like, people - just like you and me. From the celebrities I've gotten to know, they're just normal people. ... I don't know why America is fascinated by that, but they are."

But Mark David, who follows celebrity real estate on his cheeky blog "The Real Estalker," doesn't think prospective buyers are willing to pay top dollar for houses simply because someone famous has lived in them.

"It's not common. Property values are property values," said David, a 38-year-old graphic designer who writes under the pseudonym "Your Mama." "You've really got to be somebody for it to add cachet. Maybe if it's a major A-list celebrity who's going to go down in Hollywood history, like Jack Nicholson. But does anybody really care about most of these people's houses? Would you pay more for Danny Bonaduce's house? And I'm not trying to bag on him. I can't imagine that people would do it - then again, there's a lid for every pot."

Bonaduce's house, by the way, is still on the market. It was listed last July for $4.5 million - now it's down only slightly to $4.2 million. The ornate Spanish-style mansion, with four bedrooms, five and a half bathrooms and a theater on just over 7,000 square feet, sits in the hills of LA's Los Feliz section.

So why not drop the price further and finally sell the property?

"He can afford to wait it out for 20 years," said Alfonso Milanese of Show4you Realty, who co-listed the home with another agent when Bonaduce and his wife, Gretchen, filed for divorce. "It's such a minuscule mortgage on there. He's one of the few the people who are not in dire straits in selling their house."

As for McMahon's home, "we've actually gotten a bunch of offers," his real estate agent, Alex Davis of Hilton & Hyland, said recently. "I think we're going to sell it very soon and that it's going to be onward and upward for the McMahons."

[sunburn123]

oops ... I mean www.celebforeclosure.com ... guess I''m the foolish one ;)

[sunburn123]

Funny. I check www.celbforeclosure.com every day to follow this stuff. Crazy how people with that much money can be that foolish.

[barbaraf4]

"Why don''t they just pay cash for these homes?"
Posted by whiskyrocker
~~~~~~~~~~~~~~~
Most business managers would advise you not to tie up equity in real estate.

Having said that, what is there about celebrities that causes them to feel entitled to all these trappings of wealth? Buy a house you can afford and then start investing. The glitz and glitter won''t last forever. Have something in reserve.

[libsluv2spit]

Because of the tax deductions on mortgage payments!!

Posted by NewTagAgain at 02:55 PM : Jul 09, 2008
+ report abuse

***********

yeaaaaaaah right...this moron has to pay his mortgage before he can get the deductions

[reunionpi]

Before Ed McMahon: Pamela''s Federal Tax Lien, judgments and liens

http://webofdeception.com/pamhurnmcmahon.html

[patriot12436]

I find it very hard to be sympathetic to someone who has made millions and didn''t have the common sense to pay for a home in full. The people who worked hard all their lives and are now losing everything i feel sympathetic for.

[sociald63]

instead of saving or investing - these overpaid losers are spending thier $$ on clothes, cars, dope, sexxx, sushi, etc ... BOO-HOO-HOO. gosh, my salary is only 63k but i have manage to send my kids to college and pay off my mortgage

[docpeter-2009]

God forgive me here, but i really don''t see why anybody should feel sorry for celebs or Michael Vick or any other wealthy person who has fallen on a little hard time and can''t pay for their $M home. Geez what a sarcastic shame.

Get real, Celebs are just like us poor runts when it comes to the mortgage crisis. He11 they could have bought 4 or 5 $250K homes and then they would only lose 1, they would still have the others to live in.

[louklou51]

LOL, Boo hoo hoo, why don''t they cry those crocodile tears.
How can millionaires have trouble making house payments? Oh, that''s right, they are too busy enjoying the good life while everyone else suffers. I have no sympathy at all for them.

[newtagagain]

Why don''''t they just pay cash for these homes?

Posted by whiskyrocker

Because of the tax deductions on mortgage payments!!

[whiskyrocker]

Why don''t they just pay cash for these homes?