I feel terrible, absolutely terrible for all the rich people.

@Radi0logy: What? You mean you don't have 20% of 45 million to put down on a house like all of the other Consumerists out there?

So it will have "corrected" when a buyer no longer needs a down payment, interest rates are artificially plunged even lower and either businesses decide that their employees deserve $14.5mil bonuses or lenders remember that $80k/yr was close enough for neg. am. before?

Watch out people, if you buy now and you'll be priced in forever!

At a savings of $20 million, I can't afford not to buy!

Oh, wait, I can.

The housing market will never return to what it was. If it does, we are going to go down the same path again.

Sure the prices will eventually start to stabilize and rebound, but there isn't going to be 10-20% growth year after year like there was the past 4 or 5 years.

People thinking this is the "bottom" and who are buying properties to flip them in 3 or 4 years are going to be in for a surprise.

@astraelraen: Aye. Lots of legs left in this downturn. Some areas are going to get absolutely hammered over the next couple years. I don't know the NY market but it seems likely Madonna made some very happy sellers given this property's location.

@astraelraen: what 10-20% growth? Isn't the part of the problem here that house values went up but there is no actuality in the price?

Pretend I buy a house in 1970 for $40,000. 2005 it is worth $150,000. Now it won't sell for $115,000. Does that mean the house went down in value.... or does it mean that it was NEVER worth $150,000? Like most items, houses are only worth what someone who wants it will pay.

@youaredumb:

Right, so if someone was willing to pay $150k in 2005, it was worth $150k in 2005.

Another property mentioned in the NYT article on Madonna: "a 19-foot-wide town house on far East 78th Street sold for $9.5 million"

19 feet? OMG! It's so huge!

People who buy real-estate like this are idiots, and also annoying.

@Radi0logy: I dunno... I mean, to the masses in India or Bangladesh, average-Joe here in the US (of which I am one) are "rich", yet we still have our woes.

To truly starving people in 3rd-world countries, the people in India or Bangladesh seem rich by comparison. It's all relative. I suppose even the whining about it is.

I'm sure folks in 3rd-world countries play a tiny violin whenever one of us "rich folk" in the US complains that gas is $3/gallon.

@tungstencoil: I resent to your clumping India and Bangladesh in the same category. If anything, Bangladeshis think Indians live a luxurious life.

@MostlyHarmless: Fair point... I was working off the cuff, so to speak.

Tee Hee.
I have friends who were smugly saying that the subprime wouldn't affect normal mortgages, and even if so, the high net worth segment would be completely insulated regardless. I laughed then, too. But it's a much heartier laugh now.

@youaredumb: With a name like yours, surely you realize that the average home is only owned for just a bit under five years.
Because if you didn't know this, well, that'd be REALLY dumb.

There are a dozen of these million-dollar new homes on my block that were built upon the torn-down properties of older houses. They look like gigantic turds, totally spoiling the otherwise quaint, established surrounding neighborhood. I'm completely satisfied that not a single one has sold. They just sit there, with their drab stone facades, wasteful propane lanterns and chintzy For Sale signs, costing the developers millions every month they remain empty.

Yippee! Rich people have less money to spend and our economy sucks!!

@astraelraen: My county assessor doesn't think my home has lost any value until it has for three consecutive years. But for those three years, it appreciates in value.

So on the fourth year I expect it will lose value in his eyes back down to where it was the year before the market tanked, or it will get changed to ten years of consecutive loss.

@HiPwr:

The fact that these houses are already built means that even if they were buying them, the effect on the economy would be less than it would have been during the bubble when luxury homes were still being built.

@LastVigilante:

That is kinda great.

You might also like to think about how much it will cost to heat and cool that McMansion as global warming really starts to bite and utility rates rise. If you must buy, make it small!

@Cant_stop_the_rock: I think you missed the point here.

@TechnoDestructo: There a slight possibility that they aren't spending their money on other things too; like investing capital into their business or buying stocks and bonds. You know, the evil things that rich people do.

@tungstencoil: yeah, i'm one single person with my own car, multiple televisions [even if they don't pick up HD signals] and a 3 bedroom home. some days it's nice, some days i make myself sick at the amount of space my stuff takes up.
2 bathrooms for one person can seem like a ridiculous luxury compared to many parts of the world.

@KyleOrton:

"Watch out people, if you buy now and you'll be priced in forever! "

Well phrased

Yeah, but I'm sure Suzanne Somers was rough on it. We all know about her cocaine-fueled week-long parties. She probably punched holes in all the walls and peed on the rug.