12 percent of Hawaii homes are in foreclosure or threatened by foreclosure.
One of yesterday’s front page stories in Honolulu’s Advertiser was a new report on foreclosures in the country and where Hawaii is ranked.
As reported, a new mortgage industry report shows that more homeowners in Hawai’i fell behind on their loan payments last year, suggesting that foreclosures will continue to rise this year. At the end of last year, 4.5 percent of the loans statewide were in foreclosure, and an additional 12,182 mortgages, representing 7.3 percent of the market, were delinquent but not yet in foreclosure.
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Of interest to Big Island Real Estate, the article went on to suggest that “Some industry observers say most of the foreclosures are occurring on Neighbor Island resort property (that was) snapped up by second-home buyers during the housing market bubble.”
Of the 7,535 loans in foreclosure at the end of 2009, 1,809 entered foreclosure in the fourth quarter, the report said. These so-called foreclosure starts represented 1 percent of the market. Compared with other states and the District of Columbia, Hawaii had the 14th highest percentage of foreclosure starts during the fourth quarter. The state with the highest rate of foreclosure starts was Nevada, at 3 percent of the market. Nationally, the average was 1.14 percent for foreclosure starts, which was nearly the same as Hawaii’s rate.
The story concluded that, “(s)ome observers believe Hawaii is lagging behind in a housing market recovery under way in some other states because home sales and prices in other states crashed earlier and have improved along with foreclosure rates, while the Hawaii housing market experienced a more moderate downturn that is only beginning to show signs of improvement. Continued weakness in the local economy that is heavily dependent on tourism is another factor.”