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Your Morning Credit Crunch: Brownsville Sinking

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[Photo courtesy of rcherubin/flickr]

It's not that news of the subprime mess hitting the fan and splattering all over some Brooklyn neighborhoods is new, but it's still ugly. For instance, the May issue of the Real Deal offers a detailed look at the subprime meltdown from the vantage point of Brooklyn's Brownsville. On the descriptive side there's the dripping irony that "the only recourse against foreclosure" for buyers in trouble is "the very subprime mortgage industry" that fueled the crisis in the first place. Then there are the statistics. The average sale price of two- to four-family homes in Brownsville and Ocean Hill fell from $595,000 to $565,000 from October of last year through this March. The 2007 foreclosure rate on those homes was double the 2004 rate per stats kept by the Furman Center for Real Estate and Urban Policy. The neighborhoods have the city's fourth-highest level of sub-prime loans in the city. An appraiser says of the mess: "There also are a lot of distress sales." And everybody expects it to get worse before it gets better.
· No bailout for Brownsville [Real Deal]