Lynda Gill’s Poipu, Kauai, Hawaii Real Estate at Pacific Ocean Properties

Looking For A Kauai Foreclosure?  Read About This Deal Changer

“Hawaii Foreclosures Down 74%!”  Sounds good, and its true, but there is a huge reason behind this.  On October First the “foreclosure reform law” for the state of Hawaii that passed last May went into effect.  This law is big news for you folks looking to pick up a foreclosed property because the way foreclosures are coming on the market is changing and the September numbers reflect this.    

This new law here in Hawaii forces lenders to negotiate loan modifications with borrowers through mediation for non-judicial foreclosures.  There are two types of foreclosures; non-judicial and judicial and the bank can do either one.  So far the banks have elected to do non-judicial foreclosures because it’s a lot easier, less expensive and a lot, lot, lot less time consuming.  However given this new law the banks are opting to do a judicial foreclosure rather than negotiate loan modifications.  Judicial foreclosures mean going through the court system and that means a lot more time is spent foreclosing on a property which means the number of foreclosures coming on the market will be less.  Who does this cover?

• Owner occupants of residential property under non-judicial foreclosure
• Owner-occupants must reside at the property for a minimum 200 consecutive days.
• Owners of time shares, vacation homes, and commercial property are not eligible.
• Owners of homes that have had Notices of Default filed in the last 30 days, prior to the enactment of Act 48, may switch their foreclosure to judicial if they wish.
• Law sunsets September 2014

What does this mean to you if you are looking to pick up a foreclosure?  There won’t be as many bank owned properties and that’s what we are starting to see.  Foreclosures in Hawaii in September dropped 74 percent compared to a year ago, sending the state’s ranking down to No. 32 in the nation.  There were a total of 1,197 properties with foreclosure filings in Hawaii during the third quarter, or one for every 431 housing units.  Most of those, 725 filings, were notices of default. Only 74 filings were public auction notices, while 398 were bank repossessions.

So foreclosures will be a lot slower to happen.  This does mean that we will have more time to do short sales.  When you do a short sale the foreclosure process does not stop, so sometimes we’ve had properties get yanked back by the bank in the middle of negotiating with the bank on a short sale!  Now we will have more time to do short sales because the banks are having to do the longer process of a judicial foreclosure.

Last week a large number of properties went into escrow giving this section of my weekly spreadsheet clear domination!  To “read all about it” CLICK HERE FOR SPREADSHEET

Kauai Passes Bill To Regulate Growth Of Transient Accommodation Units

Bill 2410, which regulates the number of transient vacation accommodations that can be built here on Kauai, was voted on by the citizens of Kauai and passed in 2008 by a 2 to 1 margin.  Since then it has become a heated topic with those both for and against the bill.

Last Wednesday the City Council unanimously approved the final version which is a give and take on both sides of the fence, the City Council is considering this a win in light of the fact that this bill could have exploded in lawsuits and escalating tension between all parties on all sides of the issue.

North Shore resident Carl Imparato was one of they key players to bring this bill to the public in 2008.  The bill is different from what he first proposed, and from what was voted on in 2008, but he seemed satisfied.  He is quoted as saying “Bill 2410 clearly establishes that the County of Kauai can and will manage its growth in the 21st Century, this is extremely important.”   He also said that the bill “bends too far” to accommodate the needs of developers, but overall it’s not unreasonable.“It will comply with the Charter Amendment’s rate-of-growth concept over the long haul,” he said.

As it stands now the number of Transient Accommodation Unit certificates can be calculated in a multi-year basis and this will allow 5.1% growth in a five year allocation cycle.  The current number of Transient Accommodation Units (TAU) is 9,200.  Prior to December 2008, some 4,650 TAUs had been approved but not acted upon. If the lease-holders of these TAUs decide to build right away, Kaua‘i’s inventory would have a 50 percent sudden increase.  The final bill has different scenarios for allowing those exempted units to go forward. If too many permittees act upon their permits in a short period, the allocation of  TAU certificates could drop significantly. If  TAU growth lags behind because permittees decide to sit on permits, the TAU allocation could increase, but not over the 1.5 percent cap.

Missing Man Off Of Kiahuna Beach

A California visitor, who was last seen in the Kiahuna Beach area on October 3, still remains missing.  Charles Selzak is 67 years old and was last seen carrying pink fins and wearing black and white shorts with a light blue shirt.  He was reported as missing at 10:43 p.m. on October 3.  An extensive three day air, sea and land manhunt was conducted by the coast guard, fire department and police.  It was called off a week ago Friday after there was no sign of the missing man.