House Repossession to Pull Down Hawaii Home Prices Further
Friday, August 21st, 2009Last month, house repossession filings in Hawaii rose by 332 percent to 990 homes compared with the same month a year ago. July figures indicated that one out of 512 homeowners received a foreclosure filing.
However, despite the increasing number of foreclosure properties and bargain-priced houses, home sales in the state failed to pick up in the second quarter of this year. This prompted many industry analysts to conclude that the real estate market in Hawaii is in for more trouble.
While some states across the country have shown some recovery in terms of home sales, Hawaii continues to see its numbers drop despite the availability of affordable houses on the market.
Industry analysts said that real estate markets in other states are starting to experience quarter-over-quarter and year-over-year improvements in home sales and prices. But not in Hawaii where prices are falling but sales move in a very slow pace. Analysts said that indications of recovery in some states have still yet to come in Hawaii.
From April to June, combined condominium and single family home sales in Hawaii dropped by 37.8 percent compared with figures in the first quarter. But the combined median price for condominium and single-family properties in the state was 10.15 percent during the second quarter and has remained flat for almost a year now.
Industry analysts said that current trend in the real estate market indicated that home prices in Hawaii have yet to bottom out. They pointed out that despite the affordability of housing in Hawaii, prices are still higher compared with other states. This could be one of the reasons why home sales in the state are falling instead of picking up.
Analysts said that prospective buyers are looking elsewhere than Hawaii because other states offer attractive properties at below market prices, less than the costs of houses in Hawaii.
They said that many states, especially those that have been severely affected by the foreclosure crisis, saw their prices bottoming out near 2003 and 2002 levels. In Hawaii, prices peaked later and are expected to bottom out near 2005 and 2004 levels.
But some experts noted that prices in other areas in Hawaii have bottomed out, citing Ko Olina and Kapolei. Also, 23 out of the 48 ZIP codes in the state posted growth in combined median sale price for condominiums and single-family homes.
