Aloha. It’s more than a month into what is starting off to be a very promising year for Hawaii Real Estate. We are seeing through all sectors; land, homes and condos throughout the islands, multiple offers on prime listings that are of good quality and priced well. Yet we still some properties languishing on the market as a result of functional deficiencies or improper pricing. Farmers like to think of the spring and summer as growing season, but Big island Real Estate Inventory has grown these winter months, although still lower than historic averages. There are fewer distressed properties coming to the market due to improving economic conditions in Hawaii and our Act 48 that slows the foreclosure process. Statistics also show a huge decrease in bankruptcy filings, another indication of improving conditions.
Winter inventory growth results from increased demand fueled by the higher number of visitors. Snowbirds decide, often after many Island vacations, that a tropical winter on the Big Island in a sunny home beats -7 warming up to a high of 20 back home. No longer can they resist making the dream of a winter home in the sun by the sea a reality. It is also a time to find better quality inventory even if at higher prices. Sellers with the luxury of time prefer to enter the market when higher demand will support their price. It also becomes the sale season for many properties that have lingered on the market a while. The benefit of higher inventory often conflicts with higher occupancy rates of the vacation rental properties offered for sale this time of year. The income potential is a plus but most buyers want to inspect the property before buying. In Waikoloa we have gone from a 4th quarter average of approximately 32 homes on the market to the New Year’s inventory of 42 homes on the market. It looks like 1 in 4 sellers truly believe timing is everything.
It is amazing to see that from the 3rd to the 4th quarter home prices in Waikoloa actually increased almost 12%. We went from an average price of approximately $310,000 to approximately $347,000. But we seem to have a problem with appraisers not taking the time to analyze these trends and giving low appraisals. I was shocked by a low appraisal that stated “prices have remained stable with no increase” in the remarks. The restrictions on appraisals as a result of laws passed a few years ago interjecting 3rd party appraisal ordering by non-affiliated entities have the appraiser doing twice as much work for half the fee. Many of the experienced appraisers left the industry resulting in inexperienced often part-time appraisers who save time by reusing their appraisal remarks. They seem to be adjusting the comparable properties but making no analysis of market trends. Further hampering the reality of this appreciation is a recent Bank practice of asking for second and thirds appraisals after receiving appraisals validating the sale price until a lower appraisal is received. Once they have the low appraisal, the will not lend any more than that value. Banks seem reluctant to loan the low interest money filling their vaults (forgetting their rescue subsidized by taxpayers), particularly the large mainland banks. It lowers their profit margin. This is a national trend. Locally we have returned to recommending buyers use only local lenders familiar with Hawaii market trends. But as they say, “one day this too will pass!” Still the low inventory will continue to push prices higher. Click Here for Waikoloa Village Homes Report
Land prices have remained stable between quarters mostly due to a lack of quality inventory. Don’t let that $140,000 sale fool you…it was actually for two lots. Most of the better lots in Waikoloa have already been developed or continue to be held by owners waiting to build later. Without expansion of Waikoloa, we will not see a lot of change to our Land market. Click here for Waikoloa Village Land Report
The Waikoloa Village condo market continues this appreciation trend. We ended the third quarter with an average condo price of $172,929 with 14 sales ranging in price from $70,000 to $512,000. The last quarter saw only 5 sales ranging in price from $130,000 to $411,500 giving us an average of $226,500, a whopping 26.9% increase. Does this illustrate the beauty of statistics or have higher prices slowed sales? It does appear that fall is the condo season in Waikoloa Village. At least it was in 2012.
Click here for Waikoloa Village Condo Report
All in all, we are looking at an improving Real estate market in Waikoloa Village. Let’s hope everything keeps getting rosier and the economy keeps moving in the right direction. As always, call or email if you have any questions or need any information about Big Island Real estate.
Open House Friday December 28, 2012
10am to 2pm
Award winning home designed by Seattle Architect Jim Cutler of Cutler-Anderson is on the market. One of only seven homes honored as a record home annually, this 2007 winner is being offered for sale on 73 acres of land. Three separate parcels include the Cutler Ohana Home on approximately 25 acres, a pasture with ocean views of over 23 acres and the oceanfront 25 acres running along nearly 1,000 linear feet of coastline. The parccels are three separate, legal lots with county water and power.
52-4755 Akoni Pule Highway, Niulii.
Hohoho Aloha. Holidays in Hawaii are lit by the same dreams as those of other places. All the children get excited about Santa Claus and bring out socks this one time of year because there is no way slippers can hold all the Santa booty. Businesses slow down as both the employees and the employers take off to share the joys of Island life with family and friends. The feeling of aloha is even stronger this time of year.
The Big Island holiday season is the time when very special properties come on the market. The best resort and oceanfront properties are released to the market this time of year.
Mauna Kea Resort adds two very cool properties to its limited inventory of homes and land for sale. These properties are really one; a stately home on one parcel and the adjacent empty lot. It’s a very interesting opportunity for the right person.
Forty Nine Black Sand Beach also has this new listing of a great oceanfront lot. The owners club at 49-Black Sand Beach is quietly and tropically elegant set steps away from the black sands of Honu’apae Bay. There is also the possibility that I can sell you a great house at Pau’oa Beach…..have a shy seller who would like to sell quietly at the moment. We may go on the active market in early 2013.
Oceanfront Kailua-Kona has some new, high quality merry season offerings. There is a very attractive oceanfront home and a great lot for sale only a short walk away from Keiki Beach at Kona Bay Estates. A home that more than one oceanfront buyer asked about at Ali’i Point is finally on the market. There is also a new lot listing a few lots north. Down at the end of Keauhou past all the condos, along a dusty beach road is this very cool Island style home. Island life has totally different feeling from resort living out here at the edge of Keauhou.
There are many reasons why this is the time of year that typically generates the best quality of Real Estate inventory. As they say” timing is everything” and then there’s that phrase about “location, location, location”….. The location is Hawaii; the timing is now. The winter market is shaping up to be one of beautiful choices at good values. Just the way life should be….
Merry Christmas, Happy Holidays, Happy New Year!
A hui hou!
Research has proven that the Don Jullio Tequila mentioned in this article is the finest of Tequilas. Researchers were very diligent in this very difficult and slow study, so many to sip…. while limited by human tolerance limits that prevent intensive, scientific study. This cognac of Mexico deserves to be sipped, not shot. The marketing these purveyors of fine spirits have developed is quite targeted and very sensible, a wonderful way to expand a customer base. Try a little for a little more before you spend a lot.
How Tequilas Premium finds its fans.
Have you ever heard of the Glue Network? It is a virtual bulletin board to raise funds for very specific projects. Got to the site and check it out, very interesting. Its an amazing how a little can add up to a lot…to big differences in lives. Donate yourself or buy gift cards for friends. Let then pick which project they want to fund with your gift. Perfect gifts for any occasions. Amazing what can be accomplished!
The sweet sound of recent Waikoloa rains is truly welcome music! The last 90-days have seen the sale of 20-homes from a low of $255,000 to a high of $535,000. With only 38 homes on the market, this equates to a less than 6-month supply of homes. The fact that only 8 homes are listed as distressed or bank owned indicates that stability may be returning to the market place. The average price has increased 9%, from $290,962 to $317,900 although number of sales dropped slightly from the 26 sales of the previous 90-day period. 31-homes in escrow is also a sign of good market activity. Having a few higher priced homes is escrow is encouraging even if they are brand new Sunset Ridge homes which should be closing within the next 4 to 6-weeks.
While 25 of these homes claim to have some ocean view (market report covering ocean view homes), the quality of the view varies. Views from narrow corridors obstructed by landscaping and roof tops, perhaps the view is only visible from a far corner of the back yard to wide expansive views such as at this brand new house on Hai’a St. or this spectacular home on Kaupapa Place. We just saw a sale of a home with an excellent view close at $535,000, making the home on Hai’a all the more attractive priced at $439,000. The sales price of $535,000 on a 1,574 home built in 2007 proves the value of a view. The price paid by the seller when new was over $700,000. Whether financially or emotionally, this seller probably felt distressed.
Land Sales really perked up over the last 90-days with 17 total sales compared to 4-sales in the previous 90-day period. As you can see from this report, many were only on the market a very short time although some that were on the market for what seems forever finally sold. The 7-lots on the market now mostly have been on the market some time with the exception of one listed only today on Auhili Loop and the one on Hai’a St. that’s been for listed about 25-days. The Hai’a Street lot has the best view potential, is fairly level and easy to build on . The Auhili lot is also very level, no views but located near Waikoloa Park which is a plus for families with children! The average price of the previous 90-days is higher at $101,700 compared to the present average of $74,176. This may not mean as much it sounds given that one the four sales in the previous 90-day period closed at $200,000. It was an acre with great views. The range in lot sales price this last 90-day period lowers the average as none were as large nor sold for as much.
Waikoloa Condo sales remained fairly stable between the two last 90-day reporting periods. There were 16 sales this last period compared to 17 the period before. Sales ranged from a low price of $71,000 in Fairway Terrace for a 1-bedroom to an absolutely gorgeous, well furnished 2-bedroom plus loft condo at the Pointe at Waikoloa with fabulous views as the highest sale at $512,000. The high sale is welcome, but none of the other sales closed above $300,000. Expect to see an increase in volume here too with these low interest rates encouraging purchases.
Recent reports identified almost the same rate of increase in Oahu home sale prices. This is always a good sign as the rest of the islands follow Oahu market trends in a general sense. It’s interesting to note that a few months ago, average Oahu home prices dropped to the lowest level in many years. It may be safe to say that Hawaii Real Estate prices may have bottomed out. The flat line at the bottom of the curve is beginning to head north. Buyers are still in good shape because the low interest rates offsets the effect of price increases. Another interesting note is that usually in an election year, activity slows until after the election. But not this time.
Would love to hear from you about your Real Estate plans. Until then, live aloha and a hui hou.
Big Island home prices up 7.9% in August, but condo prices slumped – Pacific Business News.
BIG ISLAND HOME PRICES UP
News like this is always great to hear. Looking a little deeper we see that the home sale price average is up just about everywhere due to shrinking inventory and increasing demand. Mauna Lani Resort and Puako had some very large sales in the month of August. However, the diversity of the markets on the Big Island does not translate into an evenly distributed 8% increase. Just as the nearly 11% slump in condo prices does not equate to a decline in condo prices at Mauna Lani Resort, Waikoloa Beach Resort or Mauna Kea Resort. There we are seeing prices creeping up, sometimes leaping, as inventory shrinks and prices naturally head north. There are fewer distressed properties hitting the market and when they do, the rising of the market price floor brings these prices up as well.
MARKET HEATING UP
For the first time in years we are seeing very competitive markets. Multiple are offers coming in and less discounting in all sectors of the market. Kailua-Kona is the best example of this on the Big Island. There FOR SALE inventory is almost half the amount of homes in escrow (pending sales). We seem to be following the recent Statewide trend where homes that have been on the market as long as 18 months are now receiving multiple offers….bidding wars have returned. The super low, and I mean SUPER LOW, interest rates may be the call to action!! As the reality sinks in the the economy has been slowly recovering for years and is gaining momentum, fewer and fewer buyers are taking the wait and see approach. They don’t want to be wishing next year that they bought this year.
Because statistics lump all of the Big Island together; properties from Puna to Hualalai Resort, Kukio and all that lies in between, the rate of increase will be higher on the West Side and lower on the east side. This being my second Big Island Real Estate Roller coaster ride, I feel pretty comfortable encouraging buyers to leap now on that property of their dreams. Take advantage of these extraordinary low interest rates before the tide changes….rolling in with both higher prices and higher rates. Leap now while the water is warming up, before it’s hot enough to get burned!