Pinkerton Agent,

I have some new numbers below that might be more instructive if shown in your graphs.   It is my belief that there certainly is factual and recent historical statistical evidence supporting a concern of the Condominium segment of the real estate market to not be able to "absorb" this shock and particpate in a housing market recovery.  The March uptick is indeed strong, and it is also an anomaly when taken in context of the whole, so it is more aptly described as the data point that one should be leary of basing any predictions upon.  Taking a longer look, ie the last 6 quarters with the new March data available, one sees that the market has been trending downwards

Q3'10       138   M$s

Q4'10        125

Q1'11        151

Q2'11        183

Q3'11        118

Q4'11        95

Q1'12       132

Aside from the obvious rally in Q2 2011, and yet including it, this is downward trend.  A look back in time shows that there was a similar "rally" in Q2 of 2010, however in Q2 2009, there was no such Q2 rally.   So, what's ahead for Q2 of 2012?   We know that some buyers have stalled decisions to invest, and it is true that the magnitude of the impact is not known and people can offer their own speculations of how seriously potential buyers will consider the impacts of this legislation until the law comes down forcefully and clearly in citing this as violation of NAFTA and US Constitutional rights so that future buyers will feel safe to enter into this market.

Below are the sections in Hawaii real estate law pertaining to Sellers disclosures, and this pending litigation is considered a "Material Fact" which my attorney and financial advisor has stated "will likely have measureable and perhaps significant adverse impact on the value" of properties which are vacation rental zoned.

§508D-5 Delivery of disclosure statement to buyer;  procedures.
No later than ten calendar days from acceptance of a  real estate purchase contract, the seller, either directly or through the  seller’s agent, shall provide the disclosure statement to the buyer.

Upon receipt of the disclosure statement, the buyer shall have fifteen  calendar days to:

1.Examine the disclosure statement; and
2.Decide whether to  rescind the real estate purchase contract.

If the buyer decides to rescind the real estate purchase contract, the buyer  shall deliver to the seller directly or through the seller’s agent within the  fifteen-day period written notification of the buyer’s decision to rescind the  real estate purchase contract. Failure to deliver the written notification to  the seller within the fifteen-day period shall be deemed an acceptance of the  disclosure statement. Any rescission made pursuant to this subsection shall be  without loss of deposits to the buyer which deposits shall be immediately  returned to the buyer.

The seller and buyer may agree in writing to reduce or extend the time period  provided for the delivery or examination and rescission period. The form of the  receipt for the disclosure statement required by section 508D-4(2) shall provide  that the buyer shall have the right to examine the disclosure statement and to  rescind the real estate purchase contract in accordance with this section.

[L 1994, c 214, pt of §2; am L 1996, c 161, §5]

§508D-6 Later discovered inaccurate information.
Prior  to closing the real estate purchase contract, a buyer who receives a disclosure  statement that fails to disclose a material fact or contains an inaccurate  assertion that directly, substantially, and adversely affects the value of the  residential real property, and who was not aware of the foregoing failure or  inaccuracy, may elect in writing to rescind the real estate purchase contract  within fifteen calendar days of the earlier to occur of:

1.The discovery of the failure or inaccuracy; or
2.The receipt  of an amended disclosure statement correcting the failure or inaccuracy, in the  manner provided by section 508D-5(b) or (c).

The buyer’s right to rescind the real estate purchase contract under this  section shall not apply if the sale of the residential real property has been  recorded; provided that the buyer may pursue all additional remedies provided by  law.

[L 1994, c 214, pt of §2; am L 1996, c 161, §6; am L 2001, c 224, §3]

We may all be about to get a lesson in US Constitutional Law and the US legal system.    I have not studied the constitution since high school and did not spend much time on it then.

From what I have seen so far, most members of the Hawaiian legislature have spent even less time studying the Constitution than I have.

If the HI legislature passes these bills, it will be a memorable process and an interesting expereience.  In the end the US Constitution will prevail.

Feel free to use it.

Of course all royalties will go to the RBOAA legal fund  :-)

Off Islander,

Your point about 2 Op-eds... How sad but true!

In the new t-shirt line, however, I don't think the stuff about the "material facts" will be as big a seller as the "constitutional familiarity".

jwe - do you think that RBOAA would like an exclusive on the t-shirts or should we sell them at Maui Swap Meet, maybe a popular shirt for the pre-election "I VOTE" series?

Senate Passed voted in favor of HB2078, 22 votes for, 3 against.

Pinkerton Agent,

In addition to the 6 quarter review of the Condominium Sales' perspective, a good overlay into that is the same 6 quarters of residential home sales on Maui where the numbers are as follows:

Q3'10       179   M$s

Q4'10       125

Q1'11       137

Q2'11       187

Q3'11       214

Q4'11      168

Q1'12       152

This overlay shows that while condomium and residential home sales were in rough relation of tracking each other upto and including Q2 2011, from that point they separated with residential home sales outperforming condominium sales by $193M over a 3 quarter timeframe from July 2011 through March 2012.  Clearly the condominium segment is under distress.  I don't yet understand the factors, just see the results in the financials.

It is quite shocking that the Real Estate interests (the sales side, not the PM side) have seemingly not intervened to prevent the bill to pass the senate vote this afternoon.

@blackburied.  You might be getting ahead of yourself here.  I believe that

this will have to go to the governor to sign so I would think that our next step

is to let the governor know our thoughts and that they will be taken to court

over this.  Unfortunately, some damage has already been done than can probably

never be undone.  Any thoughts on this people?

Generally, the next step once legislation has been approved by the legislative bodies, is for the proposed legislation to be reviewed by the attorney general, for verification that the legislation is legal, and will pass court challenge.  Then, if the AG signs off on the legislation, it moves to the governor office, where the governor policy office reviews the legislation, to determine if the governor wants to sign the legislation (which is generally a political decision).  At least this is the process in the state that I reside in, and I presume it is similar in Hawaii.