Levitt Bankruptcy Leaves Homeowners in the Cold

Occupied homes sit next to unfinished houses in the part of Tradition i i

hide captionOccupied homes sit next to unfinished houses in the part of the Tradition community built by Levitt and Sons in Port St. Lucie. All construction in the neighborhood stopped after Levitt declared bankruptcy; out of 1,200 planned homes, only 90 are currently occupied.

Greg Allen, NPR
Occupied homes sit next to unfinished houses in the part of Tradition

Occupied homes sit next to unfinished houses in the part of the Tradition community built by Levitt and Sons in Port St. Lucie. All construction in the neighborhood stopped after Levitt declared bankruptcy; out of 1,200 planned homes, only 90 are currently occupied.

Greg Allen, NPR

Levittown, Then and Now

Levittown was the first mass-produced American suburb — and is widely regarded as the archetype for post-war suburbia.

Levitt and Sons built the planned community on farm land on Long Island in Nassau County, N.Y., beginning in the late 1940s. The company adopted assembly-line methods aimed at producing fast, cheap housing: By the summer of 1948, it was turning out 30 houses a day. Other "Levittowns" followed — in Puerto Rico, Pennsylvania and New Jersey.

Although today the name "Levittown" conjures images of cookie-cutter homogeneity, many of the homes in the original Long Island community have been expanded and redesigned beyond recognition.

Maria Godoy

aerial file photo shows a portion of Levittown, N.Y., in 1948 i i

hide captionThis aerial file photo shows a portion of Levittown, N.Y., in 1948, shortly after the suburb was completed. Levittown celebrated its 60th anniversary in 2007.

AP/Levittown Public Library
aerial file photo shows a portion of Levittown, N.Y., in 1948

This aerial file photo shows a portion of Levittown, N.Y., in 1948, shortly after the suburb was completed. Levittown celebrated its 60th anniversary in 2007.

AP/Levittown Public Library
New residents move into their Levittown homes early October 1947 i i

hide captionNew residents move into their Levittown homes in early October 1947.

AP/Levittown Public Library
New residents move into their Levittown homes early October 1947

New residents move into their Levittown homes in early October 1947.

AP/Levittown Public Library

Among the many casualties in the distressed home building industry, one recent bankruptcy stands out: the storied developer Levitt and Sons.

More than a half-century ago, Levitt helped to pioneer the whole notion of suburbia when it built Levittown, a post-war community of mass-produced housing in New York. Other Levittowns followed — in New Jersey, Pennsylvania and Puerto Rico.

In recent years though, Levitt and Sons accumulated debt, and with the downturn in housing sales, its luck finally ran out. When the company filed for Chapter 11 bankruptcy in November, Levitt halted construction on dozens of projects from South Carolina to Florida. Many of its customers are now stuck.

Road to Nowhere

Among those customers is Bill Quattrocchi, who lives in Tradition, a big development for active seniors — those 55 and older — in Port St. Lucie, along Florida's Atlantic Coast. As he drives a golf cart through the neighborhood, he notes a road that "was supposed to lead to a clubhouse."

"It leads to nowhere," Quattrocchi says as he drives along. "They never completed this road to the other section."

While other builders are still selling houses in Tradition, Quattrocchi and his neighbor, Bob Wilson, have the misfortune of living in a section developed by Levitt and Sons. It's a neighborhood where all construction stopped after Levitt declared bankruptcy; out of 1,200 planned homes, only 90 are currently occupied.

Quattrocchi wheels his golf cart through an area where residents live across the street from half-finished houses. He notes that "available" signs have been removed from the fronts of the homes.

Wilson points to a row of empty houses. He says in some cases the homeowners were foreclosed; in others, the buyers "just walked away."

"Either they didn't get to settlement or they decided to leave — and leave the money on the table."

The people who opted for foreclosure or walked away, Wilson says, may be smart. Even if they could sell their houses now, Quattrocchi and Wilson figure they'd face losses of at least $150,000, probably more.

They're disappointed in Levitt. Both men owned Levitt homes before and moved here largely on the strength of the Levitt reputation. They were also drawn by promises that this would be a community with unsurpassed amenities: a golf course, a 38,000-square-foot clubhouse, a dozen tennis courts, two pools.

Bought a 'Dream,' Got a 'Nightmare'

Now that the development is in receivership, Wilson says the new management is doing what it can.

"They're trying to make the people happy, that's what they're trying to do," Wilson says. "But you didn't get what you paid for. People say they bought a dream, and they got a nightmare."

Despite all this, Wilson and Quattrocchi say they're happy with their houses. If they wait long enough, they believe another builder will take over Levitt's development, and eventually, Tradition will be a great place to live.

But there's another group of Levitt customers who also are bitter at how they've been treated: those who put $40,000 and $50,000 deposits down on a Levitt home. Jerry Greenfield is one of them: He put down $45,000 on a Levitt home at Tradition and included another $25,000 for upgrades. When he heard about the bankruptcy, he figured his deposit was protected because he had put it in an escrow account.

"I felt that, jeez, I don't have a problem here," Greenfield says. He expected to get a refund for his deposit. But he soon found out it's not quite that easy.

That's because Florida law allows a builder to access money in an escrow account if it provides a bond. Greenfield had to hire a lawyer and is now working to recover his deposit from the bonding company. And that's just the deposit — he doubts he'll ever see the $25,000 he paid Levitt for upgrades.

Greenfield says he's learned that, among the dozens of people who had deposits with Levitt, he's one of the fortunate ones. Most didn't put their deposits in escrow.

The heartaches here in Port St. Lucie are similar to problems playing out in Levitt communities under construction elsewhere in Florida, Georgia and South Carolina.

Back at the wheel of his golf cart, Quattrocchi says it's been a sorry end for a company that once banked on its reputation.

" 'The oldest and most trusted builder' — that's their slogan," Quattrocchi says. How does he feel about it now? "Don't trust anybody anymore. Like it says on the dollar bill, 'In God we trust.' "

A bankruptcy judge in Fort Lauderdale is currently sifting through the claims competing for Levitt's assets. The good news for Quattrocchi, Wilson and other residents in Port St. Lucie: Levitt's lender here, Key Bank, recently foreclosed on the property and hopes soon to find a builder who will resume construction at Tradition.

Comments

 

Please keep your community civil. All comments must follow the NPR.org Community rules and terms of use, and will be moderated prior to posting. NPR reserves the right to use the comments we receive, in whole or in part, and to use the commenter's name and location, in any medium. See also the Terms of Use, Privacy Policy and Community FAQ.

Support comes from: