Foreclosure activity in Hawaii surged to a record level last month. A total of 990 properties were placed on foreclosed homes listing in Hawaii in July, representing 332 percent gains compared with last year.
In 2008, an increase of 169 percent in foreclosure filings compared with figures in July 2007 placed Hawaii in the 40th position in the foreclosure rate state ranking. And less than a year later, Hawaii made a dramatic jump to number 15 last May and did not budge from the same spot since then.
According to industry experts, Hawaii has been consistent in posting top percentage point increases in foreclosure activity.
Honolulu leads Hawaii’s counties in the most number of foreclosures with 542 in July. But if the ranking will be based on the ratio of foreclosure per household, the county of Maui is the runaway winner with 180 foreclosures, meaning one out of 361 homeowners received at least one foreclosure filing.
One out of 394 houses in Hawaii County is on the brink of foreclosure, one out of 411 in Kauai and one out of 618 in Honolulu.
Statewide, one out of 512 homeowners is in some kind of foreclosure process last month. Some industry analysts take consolation that in Nevada, one out of 56 homeowners is affected by foreclosure.
Industry analysts said that foreclosure filings were made not just on single-family houses but multifamily properties that consist of numerous units with notices of foreclosures.
Foreclosure gains in Hawaii last month were mostly posted on bank foreclosures, prompting analysts to warn about the potential of another wave of foreclosure in the state.
Despite the bleak future that the current foreclosure numbers are providing, industry analysts are trying to find some hope on other industry data, including home sales.
Nationwide, existing home sales in the second quarter of this year increased compared with the first three months. Meanwhile, the drop in property prices increased home affordability in many metropolitan areas in the state.
Home sales showed double-digit increases in 13 states last month, including 24.2 percent in Hawaii. However, industry analysts cautioned that what the market may be experiencing right now is a false bottom.
They said that buyers have been grabbing foreclosure properties because of cheap prices. But the next wave of foreclosures brought about by unemployment and adjustable-rate mortgages would rock the very fragile position that the housing market has settled into for the past few months.
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