Foreclosures Have Badly Affected Tourism in Hawaii

Foreclosures followed by the credit freeze and overall meltdown of the economy has badly affected tourism in Hawaii, among other things. Real estate prices continue to fall as people have become shy about spending on holidays.

The tourism industry in Hawaii has fallen by 10.2% till November 2008. The worst is yet to come in 2009 when there will be cuts in tourism funds. Programmes and events intended to highlight the tourist potential of the islands will be slashed. 2009 is already being projected as ‘naycation’ year where most of the people say no-to-vacation. In Hawaii tourism is the leading industry.

For some time tourists came from Canada earlier in 2008. That was when the US dollar was weak. But that gain has been off set by visitors not coming from Japan. Cruise ships with fun filled tourists ready to splurge are not anchoring in the docks of Hawaii as before.

It is apprehended that the economy will not show recovery till 2010. In 2009 unemployment numbers will worsen, as companies will be forced to cut down on work force. Some may have to shut down completely. In Hawaii bankruptcy cases had increased by 50% in 2008 from what it was in 2007. The trend will most probably continue through this New Year.

The silver lining in the grim foreclosure weather is that gas prices are not expected to touch the high levels of 2008 and inflation will ease by 2111. Retailers will have to identify the priorities, as shoppers will be focusing on the bare essentials.

Target plans to open its two stores in Oahu in March this year. This will give employment to 1,200 candidates. The opening of Kona store will give employment to another 400 persons.

In comparison to the rest of the country Hawaii has not had to weather the worst bite of the foreclosure storm – but it is not immune to it. The demand for houses fell to the lowest since the last ten years because of the credit squeeze and general fall in the economy. The adjacent islands are more or less in the same boat with a low demand for single-family houses in Big Island, Kauai and Maui.

But the prices are relatively more stable than the mainland. Inter island shipping has also been somewhat impacted by environmental laws. Experts are optimistic that the slow down in the economy will be for a short spell in Hawaii.