Quinn's situation isn't unique. It's happening in a lot of places. It's just a shock when someone you know is having it happen to them. What probably happened is that the owner took out a sub prime loan or took out too much equity thinking that he would be able to sell it at a profit. The housing market in HI is doing fine from the reports that I had been hearing, but it's not crazy. Local lenders had been more conservative as well. Most of the subprime problem in Hawai'i has been caused by outside lenders.
Update: Fix spelling mistake in title. Also note that it is Washington Mutual that owns the mortgage. WaMu is in trouble because of all of their subprime lending.
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We're seeing houses in our neighborhood that have been for sale for over a year. At one time last year 4 of the 8 houses on our street were either for rent or for sale. The two that were for sale, they aren't any longer. In once case the owner moved back in because they couldn't sell. In the other, I don't know what happened. I'm not talking ghetto either. These houses are worth half a mil to $650.
Stranger still is that the Caterpillars are starting up 4 miles down the street breaking ground on even more houses.
There is definitely a grabiness to real estate in Hawaii and I see folks moving to a bigger house or better location just because they can, but not dropping the luxury cars to do so.
It reminds me of a book Sean recommended called "The Millionaire Next Door"
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