Hawaii Real Estate Blog

Poipu Kauai Housing Real Estate Update

A small-sized beachfront resort community near the southern edge of the island of Kauai, the town of Poipu is home to almost 1,500 residents. As such a small community, the Poipu real estate market is quite a small one, so demand can run quite high while supply tends to be a bit less than in other areas of Hawaii. It’s no secret that many cities and town across the Hawaiian islands have seen their residential real estate sectors struggle immensely since the onset of the financial crisis sent the country into recession, from which it has yet to fully recover.

Though many things have improved some, the market remains volatile and prices seem to continue to fluctuate up and down from month to month, so it is difficult to extrapolate too many trends, particularly in a market where there may only be a handful of sales per month. The area also continues to see many struggling home owners, many of whom have faced foreclosures in Kauai.

In the month of July, the most recent for which statistics are widely available, residential real estate saw six homes sold in Koloa–of which Poipu is a part. This was a decrease year-over-year of one, as last year saw seven sales in July. So far this year, the community has seen only 12 homes change hands, down from 15 at this time last year, suggesting sales are slowing. Prices of Poipu homes for sale saw a bit of an annual decrease in July, a sign the market is still struggling. The median price fell to $437,500, from $450,000 a 2.8% decline. So far this year, the median is off by $25,000, or more than 5%.

The market for condos saw a similar summer slump, with only three condos sold in July versus five in the same period a year earlier. So far this year, however, the condo market has seen the pace for sales pick up versus last year, with 21 condos sold up to July versus just 14 in the first seven months of 2009. The sales prices of condos have continued to plunge. In July, the median price was $375,000 for sold condos, down by a full $300,000 from last year, when that figure was $675,000. So far this year, condo prices have shown steady signs of falling, with the median to date in 2010 at $443,000, down more than 26% from the same period of last year.

Oahu Housing quick update

The third-largest but most populous of the Hawaiian islands, Oahu is also home to the island state’s capital, Honolulu, and nearly 1 million residents, or about 75% of Hawaii’s population. The market for Oahu real estate is therefore a large one and is closely followed by those looking to extrapolate signs and trends in the greater Hawaiian real estate market.

The Oahu market experienced some steep drops in home values at the onset of the financial crisis that hit the U.S. economy. Many homes lost large amounts of their previous value, and the number of foreclosures on Oahu increased dramatically. The inventory of homes for sale on Oahu also steadily rose as more and more people were either forced out of or walked away from their homes and credit became harder to come by for those looking to buy.

Recently, the Oahu real estate market has fared a bit better since the downfall in the U.S. housing market first began nearly two years ago, with the Honolulu Board of Realtors calling its market “relatively steady” in July. In Honolulu, sales volume was up annually for single-family homes as was median price. Condominium sales still saw struggles, however, with both sales volume and median prices down in that category. Year-to-date, the average price of both single-family homes and condos are up, if only ever so slightly. Sales volume is up significantly in both categories as well year-to-date.

“Oahu’s post-tax credit sales landscape is quieter, as are other markets, but we seem to be weathering better than our Mainland counterparts,” said Brian Benton, President of the Honolulu Board of Realtors.  “Unlike most cities, Honolulu saw its pending sales in July increase over a year ago.”

Maui Housing Update of Real Estate Market

Maui is the second-largest of the Hawaiian islands and the third-most populated, with about 120,000 residents, just northwest of the Big Island. Kahului is the island’s largest town, and the island is popular with both residents, tourists and real estate investors, as Maui real estate tends to run quite high in price and can be seen as a good long-term investment.

The Maui market, however, has seen many ups and downs in recent times. The area, like so many in this island state, was hit hard by the wider U.S. economic downturn, and it saw many negative effects to the local real estate market. The number of homeowners behind on their mortgages as well as the number of foreclosures in Maui rose steadily, and many properties saw their values come crashing down to levels not seen in several years.

Since late 2008, when the market began to tank, there have been some improvements in Maui, but the sector isn’t quite out of the hole yet. In the first half of 2010, Maui had one foreclosure filing per every 245 households, with a total of 270. Some sales prices have risen, though those figures can be very volatile and fluctuate quite widely from month to month.

According to monthly statistics, in July, the median sales price for single-family homes for sale in Maui was $500,000, up just $1,000 from the previous month and down by $32,000 annually. The figure was based on 61 homes that sold over the month, a slowdown from June’s 79 sales but an improvement year-over-year from 59. The condo market saw similar signs. The median sales price was $390,000 in July, down $45,000 from June’s figures and down $27,000 annually. The number of condos moving also fell. July saw just 69 condos sold versus June’s figure of 106; in July of last year, there were 78 sales.

Kaanapali real estate housing market

The Kaanapali real estate market, found on the Valley Island of Maui, is a portion of the larger Lahaina real estate housing market. The Kaanapali housing market, along with the rest of the island and state’s markets, has been facing some contradictory signals during the most recent tracking period. For example, although home sales have been relatively static, condominiums sales have fallen off dramatically.  On the bright side, commercial real estate and foreclosures seem to be moving in a positive direction. According to an August 13, 2010 report from the Maui News, “awaii has broken its streak of more than three years of rising real estate foreclosure filings. Irvine, Calif.-based RealtyTrac reports that there were 930 foreclosure actions statewide in July, a 6 percent decline from the 990 in the same month last year. It was the first year-over-year drop for any month since May 2007, a string of 37 straight months. This report comes after RealtyTrac said last month that foreclosures in Honolulu increased 72 percent in the first half of the year compared to the first six months of 2009. July’s foreclosure count was the lowest for any month since 872 filings in November. The peak was 1,534 in December.”

Hopefully, Kaanapali condos for sale will follow the larger trend of commercial real estate in Hawaii and on Maui, which has been faring better than the housing market. For example, an August 20, 2010 report from the Honolulu Star Advertiser noted that “Hawaii commercial real estate sales appear to be rebounding, according to a new report forecasting an end this year to a four-year downturn. Acquisitions of the Continental Surf Hotel in April and the Hotel Hana Maui in May were among 56 sales that helped generate $354 million in commercial property transactions during the first half of the year, a 17 percent rise from $302 million in the first half of last year. Stronger activity in the second quarter erased what had been a 10 percent reduction in sales volume through the first three months of the year, according to the report by Colliers Monroe Friedlander…Second-quarter sales included Hotel Hana Maui for $6.8 million, Continental Surf Hotel for $14.7 million, Waianae Mall for $25.5 million and land under the Iwilei Home Depot for $23.2 million.”

Kauai Housing Update – real estate market

The island of Kauai is westernmost and oldest of the Hawaiian islands. It is known as the Garden Isle, and is home to a population of around 60,000. When the U.S. stock and housing markets began their slide and the country entered into a recession in 2008, Kauai real estate felt the effects personally as values plunged and a number of residents found themselves unable to pay for their homes and forced to turn them over as the number of foreclosures in Kauai rose.

Nearly two years have passed since the market first began to fall, and things have begun to pick up a bit for Kauai homes for sale, particularly in terms of volume if not in terms of price. In July, the most recent month for which statistics are readily available, there were 25 residential homes sold in Kauai, which actually represented a slight decline of 7.4% from a year ago. But year-to-date figures are still strong and are up on last year’s figures by more than 56%. Condo sales were slightly stronger. In July, there were 18 condos sold, up 20% from last July, when only 15 were sold. And so far in 2010, condo sales are outpacing 2009 by more than 56%, with 134 sold in the first seven months of the year.

Sales prices have been quite volatile. One month, the median price may be up by several thousand dollars only to fall the next month by even more. In July, residential homes sold at a median price of $450,000, up 4.6% from a year ago, when that figure was just $430,000. So far this year, however, the median price is down about 0.75% to $446,500 from the median through July of last year, $449,750. The condo market has also suffered continuing price declines. In July, the median price for a condo sold was $395,000, down more than 25% year-over-year. So far this year, condos have also seen an overall price decline. In the first seven months of the year, the median condo sales price was $353,875, compared with a figure of $400,000 in the first seven months of 2009.

Kihei maui Real Estate Market Update

Kihei, an unincorporated town on the Hawaiian Maui island, is located on the shores of Maalaea Bay on the island’s western shores. It is estimated to be home to a population of around 20,000. A number of apartment and condominium complexes are found along the stretches of Kihei’s beaches, which extend for about seven miles along the ocean.

The Kihei real estate market, like the market in too many other island communities, has seen its structure upended over the past couple of years as it has been faced with dealing with the fallout from the financial crisis that erupted on the mainland and later spread across the country to the many housing markets. Many homes saw their record-high values plummet, and the number of foreclosures in Maui rose to levels not seen in years. This year has seen some improvements in the market, but it remains unstable and has yet to level out completely.

According to monthly statistics compiled by Maui real estate specialists, in July, the number of single-family Kihei homes for sale that ended up with buyers closed in at seven, down from the prior month’s figure of 11 but up from a year ago, when there were just five. The median sales price in July was $700,000, up substantially from both a month ago — when it was just $450,000 — and a year ago — when it was $397,000.

The condo market is the more active sector of real estate in Kihei, since the number of condos is greater than the number of homes in this town. There were 31 condos sold in Kihei in July, off slightly from June’s 34 sales but besting figures from a year ago by five. The median price, meanwhile, was up to $290,000, up nearly $30,000 from June’s figures and more than $33,000 higher than that figure from July 2009. So far this year, 234 condos have sold in Kihei, much higher than at the same time a year ago, when only 126 condos had changed hands. This suggests the market is moving more as an increasing number of buyers jump into the market and are able to secure financing for their new properties.

Hawaii Kai real estate housing market

The Hawaii Kai real estate market, an upscale portion of Oahu’s housing market, remained relatively static year-over-year, despite some positive news in the commercial real estate sector. According to an August 10, 2010 article from the Associated Press, “The Honolulu Board of Realtors says Oahu’s existing housing market remained relatively stable in July. The board said Monday that 268 single-family homes traded hands last month, compared with 266 in July of last year. The median sales price for the July sales was $605,000, up 1.7 percent from the $595,000 posted the year before. Meanwhile, the number of condominiums sold in July fell 6.7 percent 320, and the median sales price for condos dropped 2.7 percent to $299,000. The board also said sales closed faster in July, with single-family homes listing for 39 days, down from 45 days, and condos down to 36 days from 56. Board President Brian Benton says Oahu’s market seems to be doing better than its counterparts on the mainland.”

Although Hawaii Kai homes for sale and condos for sale seem to be stuck in the doldrums for the time being, there are some positive examples of Oahu commercial real estate making a turn-around. A July 30, 2010 report from Pacific Business News noted that “Oahu’s commercial real estate market is showing signs of recovery, but it could take at least another year before it is back on firm footing. That’s the assessment of leaders of three large Hawaii commercial real estate companies as the industry moves into the final five months of the year. With commercial real estate taking a beating as Hawaii and the rest of the world struggled to survive the global recession, industry leaders here believe that the worst is likely over and recovery is on the horizon. The impact of the financial crisis is evident in the dramatic decline in commercial real estate transactions over the past four years. In the first quarter of 2006, there was $1.4 billion in transaction activity, 88 percent higher than the first quarter of this year, said Mike Hamasu, consulting and research director at Colliers Monroe Friedlander.”

Lihue real estate market update

The Lihue real estate market, the largest component of the Garden Island’s housing market, will hopefully see an infusion of capital following the loosening of restrictions on a South Shore project. In addition to providing more Lihue homes for sale, recent developments should also reinvigorate the Kauai commercial real estate market. According to an August 11, 2010 report from the Garden Island, “The Kaua‘i County Council in a five-to-two vote Wednesday approved significant revisions to affordable-housing conditions agreed upon five years ago by the developers of a major South Shore project. The original agreement — reached between the county, landowner A&B Properties and developer Kukui‘ula Development Hawai‘i — guaranteed 75 affordable homes, mostly for employees of the project. Qualified buyers would accrue one percent equity annually, plus improvements made on the property. Only after 90 years would owners attain full equity in the homes. The revised agreement allows qualified buyers to accrue four percent equity each year. After 25 years, owners will have 100 percent equity in the house. If the house is sold before the 25-year period ends, the next buyer will go through the same 25-year buy-back period. Another major change in the agreement allows developers to sell the affordable homes in the open market if no buyers qualify after a 14-month sales period.”

One of the Kauai victims of the economic recession is likely to be revived by a mainland company, according to an August 5, 2010 report from the Honolulu Star Advertiser. The article by Kristen Consillio stated that “The financially troubled Aston Kauai Beach at Makaiwa hotel was sold at the end of July to JMI Realty, a California real estate investment and development firm, according to sources familiar with the transaction. Hotel manager, Aston Hotels & Resorts, yesterday notified the state of the sale of the 311-room resort and possible layoff of 112 employees on Oct. 12 when Aston’s contract is terminated, according to the filing with the state Department of Labor and Industrial Relations. However, most — if not all — of the work force will likely be retained with the new owner, which will conduct jobs fairs in the near future, according to the court-appointed receiver Joseph Toy, who has been overseeing hotel operations since June 2009 after the seller defaulted on a $43.2 million loan. The terms of the sale were not disclosed.”

Kahului real estate market

The Kahului real estate market, one of the largest components of the Maui housing market, saw another difficult month in July. Both the median price of a Kahului home for sale  and the number of properties sold declined in the most recent tracking period, perhaps a reflection of the expired federal tax credit. An August 7, 2010 article from the Honolulu Star Advertiser noted that “Home sales and prices were little changed on Maui last month, as activity eased away from the dramatically higher number of sales and more severe median price declines that occurred earlier this year. There were 61 single-family home sales in July, just two more than the 59 sales in the same month last year. The median price was $500,000, down 6 percent from $532,000 in the comparable period. For condominiums there were 69 July sales, an 11.5 percent decrease from 78 sales a year earlier. The median price was down 6.5 percent to $390,000 from $417,000…Year to date, the number of single-family home sales is up 37 percent, and the number of condo sales is up 52 percent. Year-to-date median prices are down 9 percent for single-family homes and are down 28 percent for condos. Some of the recent slowdown in sales activity might be due to the end of a federal stimulus program that provided a tax credit of $6,000 to $8,000 to buyers who signed home purchase contracts by April 30. Most of those sales have been completed.”

The dual decline in the number of properties sold and the average sales price of Kahului homes for sale was echoed in an August 6, 2010 article from the Pacific Business News. This piece stated that “Maui homes sales saw a slight increases in July, but the rest of the news wasn’t as good. The median price of homes there slipped, and both sales volume and prices fell for condos. The 61 single-family homes sold last month represented a 3 percent gain from the previous year. Condo sales dropped 12 percent, from 78 last June to 69 this past month. The median sales price for single-family homes and condos both dipped more than 6 percent. Home prices averaged $500,000 in July compared to $532,000 in 2009, and condo prices went from $417,000 to $390,000.”

Ko Olina real estate market

The Ko Olina real estate market, a predominately residential and vacation-oriented sector of the Oahu housing market, continues to face trouble, as home sales declined somewhat. The median sales price for the island market rose somewhat, but the boost was rather small considering the additional factor of the expired federal tax credit. An August 9, 2010 article from the Pacific Business News stated that “July home sales on Oahu were down slightly compared to the same month last year, according to the Honolulu Board of Realtors. A total of 268 single-family homes were sold last month, essentially flat when compared to the 266 homes sold during the same month last year. Condos, by contrast, saw a sizable drop, going from 320 units sold in July after a total of 343 units were sold during the same month last year, according to Realtor data. July’s decline was even greater when compared to June results. July’s totals for single-family home sales were off 8.5 percent, and condo sales were down 21 percent, Realtor data revealed. Sales prices for July were basically flat when compared to last year. The median price for single-family home sales was $605,000, up 1.7 percent from the selling price of $595,000 in July 2009. The median price for condos was $299,000, down 2.7 percent from the median price of $307,250 in July 2009, the board of Realtors reported. Single-family home prices were down 4.3 percent from June’s median price, while condo prices were down less than 1 percent during the same period.”

Much of the same mixed news for Ko Olina homes for sale was reported by Hawaii News Now on August 9, 2010. The article by Howard Dicus noted that “Realtors across Hawaii reported generally strong home sales and prices on deals that closed in July, if not the much-improved market they hoped would be spurred by low mortgage rates. Oahu saw 268 July home sales (up from 266 a year ago) for a median price of $605,000 (up from $595,000) while buyers closed on 320 condo sales (down from 343 a year ago) for a median $299,000 (down from $307,250), the Honolulu Board of Realtors reported Monday.”