Pacific Business News again shows why it’s tops at business reporting with a close-up look at foreclosures in one community. Ewa Beach 96706: Ground zero for Hawaii foreclosures, by reporter Janis Magin, is definitely worth a read.
The story traces a couple’s purchase of a new $878,990 home purchased with no money down and monthly payments of more than $5,000 via mortgages written by Countrywide.
Countrywide specialized in “exotic” mortgages that required no money down and minimal documentation, and developments like Ocean Pointe and Ewa by Gentry that offered townhouses and smaller “starter” homes pulled in thousands of buyers. For families like the Tuiasosopos, the mortgages that back-loaded interest payments allowed them to buy much more home than they could with a conventional mortgage.
Editor Jim Kelly says “it’s one of the only pieces to go beyond the monthly foreclosure numbers to explain how Ewa Beach became the foreclosure capital of Hawaii — and how Countrywide helped make it happen.”
And the Star-Bulletin’s Allison Schaefers reports today on Hawaii’s climb up the ranks of states facing real estate woes.
But, wait. I seem to recall stories from a couple of years ago explaining why Hawaii would not be pulled down into the foreclosure muck because lending here was different and there were few subprime mortgages.
A little more than a year ago, Schaefers was reporting on the same subject but with a different finding.
Until recently, Hawaii enjoyed the boomtown atmosphere also seen in many now-troubled mainland real estate markets like Nevada, California, Arizona and Florida. But while many of those mainland markets have plummeted, Hawaii’s market has held.
“Speculation was not as prevalent in Hawaii,” said Jon Whittington, senior vice president, regional manager of Countrywide Home Loans in Hawaii. Whittington was one of two speakers at a meeting of the Hawaii Chapter of the National Association of Industrial and Office Properties yesterday.
I can see this being the subject of future workshops. What could local reporters have done then, before the meltdown–what further data should have been available, what sources uptapped, questions unasked–to have been ahead of the curve in reporting on the state of Hawaii’s real estate market instead of following the industry “line” until the bottom fell out?
Check out the Miami Herald’s recent series on mortgage fraud for ideas of what can be done.
There are sites like Countrywide Home Loan Sucks where consumers share their gripes. While not the most reliable of sources, these might have pointed to problems. Home Mortgage Disclosure Act data could also have pointed to the number of subprime or high interest mortgage loans, their geographic concentration, etc. I’m sure there are lots of other untapped sources as well.
How about it, SPJ? Doesn’t this sound like a hot teaching-learning opportunity?
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“What could local reporters have done then, before the meltdown?”..
As for local reporters employed by corporate media entities, their career insecurity doesn’t allow for said reporting. Harper’s Magazine back in May 2006 published, “The New Road to Serfdom: An Illustrated Guide to the Coming Real Estate Collapse”. That pretty much nailed it. As did their story, published before Bush and Cheney were elected in 2000, describing the croney capitalist nature of that tragic and criminal regime. Best I can tell, Harper’s doesn’t just play tunes called by their sponsors, unlike the pathetically compromised “news” (content?) we have in the islands. It’s a fundamental flaw of these organizations. The solution? – independent news media.
As the great Studs Terkel said (to paraphrase), ‘the prescient minority must be heard in these matters.’
Incidentally, he was talking to the venerable journalist Amy Goodman (of Democracy Now) at the time – a journalistic role-model worth emulating, if not just reading.