Harbinger of housing crisis: One of America’s ritziest neighborhoods rocked by shock spike in foreclosures
It’s known for its facades. Both its buildings, and the people they house, need to keep up appearances.
But one of them has failed, and it’s not the 100-year old New York City buildings that are in trouble. It’s those who live in an elite ZIP code who are desperately trying to keep up with the Joneses and no longer can.
A slew of wealthy residents along Manhattan’s historic Park Avenue have had their apartments foreclosed on recently. In fact, foreclosure rates are soaring across New York City overall.
New figures reveal a double-digit spike in mortgage defaults across the city this spring.
The swanky stretch of Park Avenue, that’s lined with manicured gardens, logged a cluster of foreclosures, despite the sky-high property prices.
‘Interest rates are rising, there is high economic distress, many times generational wealth does not mean someone is liquid,’ luxury Serhant realtor Peter Zaitzeff told the Daily Mail.
‘Pandemic-era protections against foreclosure are also gone, so that is also a factor.’
New York also remains notoriously expensive, even for the rich.
Living on Park Avenue remains notoriously expensive, even for the rich
A slew of wealthy residents along Park Avenue have had their apartments foreclosed on
Peter Zaitzeff, sales director at Serhant in New York
Even when adjusting for inflation, the cost of living in wealthy ZIP Codes in New York has increased far above national averages. It’s often hard for residents to keep up.
The latest foreclosure report from PropertyShark.com shows an 11 percent jump in New York City foreclosures in the second quarter of 2025, compared to the same period last year.
In Manhattan, which has a population of 1,628,000 according to the US Census, 46 homes were hit with new foreclosure filings from April through June — a 15 percent year-over-year increase.
Shockingly, eight of those were located in ZIP code 10022, a posh section of Park Avenue, lined with manicured flower beds, luxury boutiques, and homes listed at a median price of $1.3 million.
Yet, this wealthy enclave was still affected.
Zaitzeff said that when people start getting in over their heads, they often take out cash loans thinking they can easily repay them.
‘Many borrowers who took out loans at a low-interest rate didn’t fully repay them and now they still owe, and they will owe more and more as they repay slowly or not at all,’ he said.
‘It’s difficult for individuals to cover their debt.’
Eight foreclosures were located in ZIP code 10022, a posh section of Park Avenue, lined with manicured flower beds, luxury boutiques, and homes listed at a median price of $1.3 million
In Manhattan, which has a population of 1,628,000 according to the US Census, 46 homes were hit with new foreclosure filings from April through June
A doorman hails a cab on swanky Park Avenue, known for its glamour
And while there’s always action in the New York real estate market, for luxury rentals, investor-heavy areas like Midtown Manhattan are seeing less demand since the pandemic.
For example, a studio in the historic Parc Vendome building on West 57th Street has entered into foreclosure and is selling at $525,000 — a steal for Manhattan.
A Central Park adjacent 1-bedroom, 1-bathroom foreclosure is selling for $565,000 on the West side.
A studio on 9th Avenue in Hell’s Kitchen is foreclosed and selling for $394,700.
While Manhattan is seeing foreclosures, the neighboring borough of Brooklyn is now officially the city’s top foreclosure spot.
Brooklyn saw 129 first-time filings in the second quarter of this year, a massive 36 percent spike compared to the same time in 2024.
The ZIP code 11236, which covers Canarsie and East Flatbush, led the list, with 17 new foreclosures in just three months.
Meanwhile, Queens saw 128 foreclosure filings, which was down 20 percent from a year ago.
Underneath the display of wealth are people struggling to keep their homes
Foreclosures are up all across New York, including Manhattan and Brooklyn
The Bronx is facing a foreclosure crisis of its own, with 57 new cases filed in the spring, which is up a jaw-dropping 73 percent from the same time last year.
That figure surpasses the borough’s previous five-year high recorded earlier this year.
Staten Island isn’t faring much better, with 48 foreclosure filings, up 25 percent year over year.
Of the 408 foreclosure filings citywide this spring, two-family homes accounted for one-third of all cases.
Single-family home foreclosures actually declined by 2 percent.
But all is not doom and gloom.
Zaitzeff says a foreclosure could work in a buyer’s favor. Getting yourself a knowledgeable realtor who can access a deep foreclosure database is key.
‘The banks want these foreclosures off their books, so in general they are very willing to negotiate,’ he said.
