A Newport mansion gets auctioned online
I remember gawking at some of those spectacular Gilded Age mansions on the Newport waterfront a few years ago during a weekend getaway with my wife.
That was back in 2005, during the height of the real estate boom.
And if you had told me four years later, at least one of those mansion owners would be desperate enough to try and unload their Victorian masterpiece through an online auction, I would have thought you were babbling nonsensically.
After all, real estate was gold back then, especially grand old Newport mansions.
But as real estate values continue to spiral furiously downward, that’s just what’s happening now.
The Wrentham House, an 1891 stone and shingle mansion on Ocean Avenue in Newport, hit the online auction block on July 6.
The minimum bid for the mansion was $6.5 million, or less than half of the $14 million it was originally listed for.
The house has since been pulled, with the owners claiming to have finally found a buyer after four years of searching.
High end sales, whether of luxury condos or mansions, have been hard hit in the current downturn.
The bigger the loan, the more skittish the lender, while the loaded business execs and investors that once had the money to splurge on such deals are licking their stock market wounds.
All told, there have been just 20 sales over $1 million in Rhode Island through the first five months of the year, compared to 68 during the first five months of 2008, The Warren Group reports.
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The market for high end second homes is getting crushed. No surprise here.
Weren't at least some of those mansions previously auctioned for prices in the range of $10K? If my memory serves me correctly, this was a long time ago around the time of something major occurring - maybe the introduction of the income tax or The Great Depression - so you would need to adjust that number for inflation, but even so it's still bloody low. Those things cost a mint to maintain because of their size, hence the low selling prices. That's why they are all museums now rather than private residences.
odds are, this is a "faux" auction, pitched to draw interest but meanwhile there is a high, undisclosed, reserve price (usually set by the current owner or the a bank). Basically a "testing of the market".
Yep, whenever I told people that things were going to blow up back in 2004/2005, they told me I was crazy - real estate prices never go down.
Interesting thing is how many people still believe that. They think this is a temporary dip that will correct, and that "now is a great time to buy" and "wait a few years to sell, the market will come back"
Denial of reality is an amazing human trait. In other news, foreclosure filings are up massively in Massachusetts today. Anyone want to hazard a guess as to what that will do to real estate prices in the next few months?
Shouldn't the headline be, "A Newport mansion doesn't get auctioned online"?
This blogger might want to review your comment before posting it.
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