Short sales increasingly popular with LI luxury homeowners

Short sales are becoming more and more common in expensive areas as Long Island luxury homeowners try to escape the embarrassment of a foreclosure, the New York Times reported. In Nassau County, 22 houses worth more than $1 million are listed as short sales and
in Suffolk County, that number is 12.

Short sale inventory reached a record high in April, according to Richard Halloran, managing broker of Coldwell Banker’s Babylon office, citing 1.042 Nassau homes listed as short sales and 2,430 in Suffolk. In December 2008, those figures were 1,541 in Suffolk and 633 in Nassau.

“With the courts at a standstill and banks not foreclosing on properties,” Halloran said, “the banks are getting better at doing short sales, so more people are doing them.”

Some banks are even handing out bonuses for owners who opt for short sales.

The incentive for the seller to go for a short sale, Richard Klein, a real estate lawyer handling a lot of such deals, said, is above all the credit ramifications and embarrassment factor of foreclosure.

“It’s a private transaction,” he said. “You can leave with your dignity.” [NYT]