Sex and the subprime market…
Late Friday, Countrywide Financial (CFC) filed its 10-Q that contained new warnings about its ability to access public debt markets, sending the stock down sharply today.
As most people know, Countrywide is the poster child for lenders gone wild. And how better to illustrate that than with this house (scroll down to the third house) at 5601 Flotilla Drive in Holmes Beach, Fl? A quick scan of Countrywide’s REO listings for Florida, which now stand at 879, compared with 817 just three weeks ago, shows that Countrywide now owns this house, which was listed at $1.89 million on the broker’s site and $904K now that it’s owned by Countrywide. I happen to know this part of Florida because I used to live there, so I’ve been checking Countrywide’s site pretty regularly and this is the first time a house in Holmes Beach — a sleepy little beach community that was way over-developed in recent years — has shown up. My guess is that given the frenzied development down there, it won’t be the last.
But here’s the punchline: according to this article from the local paper, the house was used to host — wait for it — Internet sex parties.
“The party Web site states that anyone can attend any of the parties if they pre-register and pay a fee, or attend free if they agree to have their photo taken during the sexual activities that take place at the events. The site shows in detail photographs of “activities” sponsored by the club, registered attendees, the schedule of parties and other “events.”
So it wasn’t just Countrywide’s mortgage brokers who went wild. – valuing a house for about 50% more than it is now worth. It was the people inside the house, too. Maybe they should have charged more for the parties!
UPDATE: A subsequent search of Manatee County records shows that the people who owned the house owed $1.1 million when a judgment was entered against them in late July, and not the $1.89 million the property was listed for. Still, this one example shows just how crazy real estate was in this part of Florida.
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Posted in Tags: 10Qs, Friday filings, subprime |
 4 Comments » |
November 13th, 2007 at 10:02 am
The working poor were the ones who had the American dream pulled out from underneath them by losing their houses. The world could hardly seem like a fair place to them. It does seem like powerful people are no longer accountable, though. For example, you lose money on Wall Street as a big-time CEO and you get fired. This is ultimately why O’Neal lost his job. Merrill’s board members, whom this article identifies, needed to replace O’Neal because he lost huge sums of money. Nevertheless, Mr. O’Neal still leaves as a wealthy man.
December 1st, 2007 at 1:17 am
My family lived in that house from 1972-2004. We were devastated to read about all of the bad publicity that property has suffered. That house was a wonderful, family-filled, loving home where I raised my 2 daughters and my parents were gracious enough to have us live there. We have many beautiful memories there, but still suffer the ridicule of living in the “sex house”. How unfortunate that our memories and the history of our home has been marred.
December 2nd, 2007 at 9:36 am
I am the privious owner of this hse, It was built in 1957 or there about, we purchsed the hse like it is now, we did add the large garage, for a motor home, and rebuilt the boat hse. This was the only thing that was added.We had the stucco, and paint put on the entire place. And remodeled the front entrance.
So the hse was not overbuilt by the new owner, they did however improve the interior, which I feel did a great job.
It bothers me that all one can say about the place, are all negative, your remarks certainly are not necessary….
December 2nd, 2007 at 3:32 pm
My comments are all negative? Sorry…but I’m not a real estate broker. The whole point of this post was to illustrate Florida’s over-heated real estate market by talking about an area I’m very familiar with.