Hawaii Foreclosures rising

This morning's newspaper has an article titled "Isle foreclosures slowly building."  The article intrigued me as a Palolo Valley resident and realtor in Hawaii.

House for sale in Palolo Valley

I live just around the corner from the house pictured in the newspaper article (and pictured above).  This house is located in Palolo Valley, a Honolulu neighborhood.   Several months ago the house had a garage sale and we stopped by to check it out.  The owner told us his story about moving and claimed that he had sold the house.

Later the house came on the market at a high price with a low commission.  That's a deadly combination for a home seller.   I imagine the realtor recommended a lower price with a higher commission but he or his bank said "No". 

The price was reduced recently but I think it's still too high.  The current list price is $609,500.  I think this house would sell for about $525,000.

Checking the Public Records, it appears that the bank has repossessed the home shortly after the owner put it on the market.  The recorded value was $632,199 (probably the amount owed on the house).  The former owner bought the house in 2002 for $345,000.  What's going in here?  This shouldn't be a foreclosure sale!  Did he take out a HUGE home equity loan?  It looks like the bank made a big mistake if they lent the owner that much money for this house.

The owner certainly didn't do much fixing on the house.  When I looked at it a few weeks ago there was a shed in the backyard that was termite ridden.  In the last week a crew demolished the shed.  The rest of the house appears to be sound, at least not a teardown. 

The news article mentions that the house will go to foreclosure auction.  If it's not sold at auction they will continue to market the property.  If you're looking for a fixer property, keep an eye on this one.  Be prepared to spend a good chunk of money fixing it up.

Here's how to sell a house

Recently a homeowner called me, wanting to sell his house in Kaneohe to avoid foreclosure.  He was concerned with satisfying the banks and that was it - he didn't mind getting no return on his investment.  The list price he had in mind was low and I actually suggested we price it a bit higher (that is SO rare). 

Our list price was a great value we received a flood of offers - 19 total.  The final offer went $135,000 higher than our list price!  Moral: Buyers still have money and are ready to snap up a good deal - sellers just need to prep their houses, price them right and be willing to pay a decent commission.  If the sellers insist on a low commission to the buyers agents', the buyers' agents have little incentive to show the house to their customers.

Hawaii Foreclosure rate one of the lowest in the U.S.

Hawaii is approximately the 7th lowest state in foreclosures.  Delinquencies on Hawaii mortgage loans are less then 2%, however that's an 100% increase over what they were a year ago.  There are so many people living in Hawaii and wanting to move here and buy a home, I would not expect a huge fallout in housing prices.  Some will say "you realtors are always trying to prop up the market."  Maybe so, but I've put my money where my mouth is, having bought two properties in the last two years.  If I didn't believe in the stability of our housing market you can be certain I would have sold them.  Hawaii real estate prices will continue to rise over the long term.

• Honolulu Advertiser foreclosure article 3/30/08

• Rate this Post!

  Select Your Rating:

  • 5 Stars (Excellent!)
  • 4 Stars
  • 3 Stars
  • 2 Stars
  • 1 Stars (Poor)

• Share this Post

  Share With A Friend:

  Your Name Your Email

  Friend's Name Friend's Email

  Optional Message

  Send

• Print
• Social Bookmarking

  Add to Bookmarks: