Reports claim that more and more Hawaiian timeshares are getting foreclosed due to property tax surges. 

Property values around the region are dropping and Maui is no exemption. In the last year, property taxes on Maui have doubled. The taxes have raised concerns from timeshare owners. They are complaining that they are burdened by a consistently growing property tax that is not applicable to permanent residents in the island.

The county government of Maui has been experiencing budget shortfalls and it is recuperating some of its losses through property tax increases. This move is made at the expense of Maui timeshare owners, resulting into hundreds of foreclosures.

The American Resort Development Association (ARDA) says that the case is the first of its kind. Maui is the first local government to set up a separate tax category for timeshare owners, a legislation that was approved in 2005. The island’s tax rate for timeshares is the highest in the nation.

On the other hand, timeshare default rates are still low at 5 percent. Unlike conventional mortgage formats, mortgages in Hawaii are held by resort owners.

While there are many foreclosures in the region, it has opened up a new market for timeshare bargain hunters. Foreclosures sell timeshare properties at very low rates, and will be taken advantage of by foreigners. Despite high property tax rates, Hawaiian properties are still quickly sold on the market.