I'll Put My Money on John Kanas

On Tuesday evening, John Kanas, CEO of North Fork Bank, spoke at the annual dinner of HANFRA, the Hamptons and North Fork Realtors Association. He is one of the area's biggest and most successful businessmen, heading up a bank that will be the 7th largest in the US, after the mergers with Hibernia Bank and Capital One are complete.

During his 20-minute discussion he stated that, while there were certainly pockets of distress and some markets that were feeling the strain of over-enthusiastic condo development, there were NOT signs that this current market would result in anything similar to the 1989-92 market decline.

On the flip side, you have RealtyTrac.com publishing reports of 25-50% increases in foreclosure activity this year. More bad news for real estate. Does anyone realize that Realty Trac makes its money from selling subscriptions to their foreclosure reporting service? How many "investors" or wannabees are willing to pay $39 a month to get all the newest foreclosure info for their zip codes?

I was, for about 3 months. Then I realized I was getting old and incomplete information that RealtyTrac appears to be "churning" - sending time and time again in order to appear like new information. What RealtyTrac is really setting up is another Lead Generation model, designed to get leads and sell them to real estate agents, using the foreclosure twist as a marketing tool.

Very exploitive. Somewhat clever, but very exploitive. Another interesting tidbit is that it took me over 3 months of effort to cancel my subscription to the RealtyTrac service. The links to unsubscribe on their website didn't work and the instructions telling me how to unsubscribe led to dead ends. I sent them emails and finally, after no response, found a telephone number to call. Of course, I had to call another "special unsubscription number" that was closed and had limited office hours. Finally, I called and a very nice man took my info (no AOL-type experience). We'll see if the charge shows up on my next credit card bill. I can't say I'd be terribly surprised. SHAME ON YOU, REALTYTRAC!!

Reported info from Long Island Profiles is that foreclosure sales have actually gone down in the Hamptons (combined townships of Southampton and East Hampton) in 2006 vs 2005. For the first 6 months of 2005, there were 6 foreclosures with an average transfer price of $513,000. For the same time period in 2006, Long Island Profiles reports 3 foreclosure sales, with an average price of $517,000.

So, that makes reported foreclosure sales in the Hamptons down 50% in 2006 vs 2005! But is that the headline for this post? NO! Why not? Because the difference in those figures is not statistically significant, and sending out a newsflash reporting that "Foreclosures In The Hamptons Are Down 50%" would be exploitive and irresponsible.

So, back to my original point, Mr. Kanas. I like straight talk. md

md