if you bought a house in Puna in the last 5 years

[Kelena]

I just want everyone to know that I have seen the bottom. It's official. I'm ready to call it. I saw the bottom. I was at Kehena when I saw it. I was too much of a gentleman (and too afraid of my reaction) to look at anything else, but I definetely saw the bottom.

[John S. Rabi]

quote:

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Originally posted by KathyH

I only wish I had done some interim housing and were looking now. (not at foreclosures) Hindsight is 20/20.

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Hey! Don't you remember?! I told you not to buy when you were looking at homes with Deborah, but you didn't listen to me! [!]

Aloha,
John S. Rabi, GM,ARB,BFT,CM,CBR,FHS,PB,RB
808.989.1314
http://www.JohnRabi.com
Typically Tropical Properties
"The Next Level of Service!"

[Carey]

Hey RadioGuy... you now should go back to the tax assessor... (if memory serves me, last summer you didn't like the fact that your property was valued higher....)

[missydog1]

John, I remember that every day! Very much so.

[csgray]

Kathy,
We just went into escrow on a bank owned repo after waiting 3 years to buy, not because we want to profit off someone's distress, but because that was all we could find at a price which reflected the realities of the current market. I have spent the last two years in a tiny apartment which I hate, while we waited for the market here to come to its senses. I bought my house in Oregon in 1985 in the month the market was at its absolute bottom, we sold almost 2 1/2 years ago at the peak, and were willing to endure a less than ideal living situation while we were patient. Even now lenders want us to borrow $50,000 more than we are comfortable with, but we are being conservative. The former owners of the house we are buying are off Island and bought at the peak, either as an investment or with a long term plan. They were unable to make payments, lost to the bank, and we are buying from the bank. After 3 years we know we want to stay in Hawaii and this house will be our home, not a get rich quick scheme.

Most of the short sales and repos on the market in Puna are taxed at the off Island rate, which tells me that they were bought as investments under the assumption that the market would continue to race upward. Judging from the prior sales dates and prices, many were probably ARMs, which were simply a gamble that prices would continue to rise quickly. This turned out to be a faulty assumption.

I am not a bad person for buying a house that a bank ended up owning, and I don't think it is bad karma to have not chosen to follow the other lemmings off the cliff. I view it instead as the reward which is due to people who have lived modestly, not beyond their means, and who were willing to be patient while things settled back to reality. I have sympathy for those who are now hurting, but your home is not an ATM, no one is promised a sure thing in investing, and it was ridiculous for people to think that 100%-200% increases in values over very short periods of time, on houses bought with little or no money down, were sustainable.

My last comment is to say that our realtor, John Dirgo, has never urged us to look beyond what we could afford, didn't encourage us to cook the books with the loan broker he introduced us to, and has been perfectly honorable in all his dealings with us. Also patient beyond belief!

Carol

[missydog1]

sorry Carol, if my remarks stung.

Perhaps I should say that if you buy a local person's home, that they lost, the bad karma could be very immediately manifested as hostility from the family. You are not doing that.

So maybe I am alone in a sea of buyers who were just investors, but I kind of doubt that all were.

It's just my personal belief I would look for a person who could still be saved from ruin to buy from rather than the bank, when it is too late for the homeowner to be helped. My personal beliefs are not always the most practical, and it's my own code.

I would just like to say again that unless you know the prior owners personally or know their story, it is an assumption to believe they were involved in a get rich quick scheme. People do use ARM's who plan to stay in the home. They may plan to refinance. I don't know these people, and they may be just as you think, but I feel uncomfortable judging them in absentia and with no personal information on their motives.

But I wish you good fortune in your new home! []

I feel bad now; this is radioguy's topic. I just felt like he was getting dumped on.

[Kelena]

I think Kathy is saying that buying a foreclosure would feel bad to her. I don't think she is condeming it for others.

I agree with Carol that John is a very sweet, no-pressure guy. A dear person.

Lay off the realtors -- they aren't responsible for this anymore than bankrutpcy attorneys are responsible for creating the conditions that lead people to bankruptcy.

I bought my Hawaii house in a short sale. The owner, who I call Dead Sarong Guy to distinguish him from Live Sarong Guy, drove his Hummer over the cliff on Kaloli Point. He haunts the house but no one perceives it but me. Guests, my boyfriend, dear friends, family, no one hears or sees a thing. All visitors to my house are deliriously happy and sense nothing but sweetness, light and zenlike peace. But for me ---well, let's just say I won't sleep at my own house alone. So I can relate to Kathy's comments. I absolutely will NOT sleep in the very charming Ohana under any circumstances. Horrifically haunted. "Dead by Dawn" type haunted. My statuary is inhabited by spirits. Anyway, so I relate to Kathy's comments and concerns. Might be different if the previous owners were not BIG personalities with island-wide reputations who are now --how shall I say this?-- dead.

[Guest]

I'm hearing a lot of Karpman's Triangle in this thread.

Why Don't You/Yes But; If It Weren't For You; Why does this Always Happen to Me?; See What You Made Me Do; You Got Me Into This; Look How Hard I've Tried; I'm Only Trying to Help You; and Let's You and Him Fight.

[missydog1]

Ah Glen, you know what I remembered about your purchase after I wrote that and also remembered you struggled with the choice. You are a good soul Glen, no blame.
Also when you bought it was around the same time I bought IIRC because we were both writing about looking at property, and we didn't know what was coming, and there weren't people going under all around us.

I am serious though that I believe that if the housing market and economy is to recover then people need to be buying homes from other homeowners. If everyone waits until the bank owns everything to buy, it will be a horrible disaster even more than it already is, and the repercussions will affect all of us, as everything is connected.

Not getting down on csgray, just talking about the future.

[csgray]

Kathy,
I wasn't saying you had been looking for a get rich quick deal, or used your house as an ATM, but many, many people did, and now those properties are becoming REO properties and reducing the value of homes like yours, which is grossly unfair to you. Dealing with banks to buy from is an absolute nightmare, and if we could have found anything close to what we wanted, at a price we could afford, being sold by a person instead of a bank, we would have bought it with great pleasure.

The following is not addressed to anyone personally but are general observations:
I have looked up virtually every single house being listed for sale in Puna for less than $300,000 for the last 3 years; most houses put on the market, and especially the vast majority of the repos and short sales were off island owners who bought in 2004, 2005, or 2006 during the big run up in prices. People who can afford to stick tight and wait are waiting, so not many owner occupied homes are on the market. We had already made the decision to move to Puna and I was dismayed to watch prices skyrocket beyond the prices people like us could pay, but came anyway and waited out the insanity.

I lived in my last house for 20+ years, my children grew up in it, and we poured money and sweat into that funky little 850 sq. ft. bungalow the whole time. The new owners were delighted to buy a house in its price range that didn't come on wheels (manufactured home) and they were a young couple a lot like I was when I first bought it. I was happy to sell it to them. We plan to grow old in this house for the next 20-30 years, so I don't really care if we didn't wait for the bottom. I hate living in a tiny apartment under the thumb of a condo board, and I want a yard, a garden, a couple of dogs and to be able to have my daughters visit without having to sleep on the living room floor when I get up at 5:15 to go to work. Now we will have a house and our payment is something we can afford, when it is paid off, I will be able to retire.

You only have lost money on the value of your home if you are selling it. The people who are really getting hammered in this are people like Kathy who did buy their house to live in, but have had major life changes which altered their plans and now can't sell their homes for what they need to move on with their lives. It is grossly unfair that people who were not trying to game the system and make huge profits are paying for the sins of those who did. Its also unfair that my retirement accounts are now greatly reduced, but there are no sure things in life and I am hoping things go back up before I get too old to keep up with teenagers all day long, but I don't expect anyone to bail me out either if they don't. (Damon please raise your son to be someone Auntie Carol can teach when she is old, but wise.)

Radioguy,
Talk to your lender using the tips others here have given you. Lenders are listening, a friend just was able to avoid foreclosure because her lender agreed to 5 years at interest only. She did have to show a change in situation since the loan was approved and her loan hadn't been chopped up and resold which made it easier.

Carol