House inventories continue to fall in Kona, now dropping to a level not seen since 2013, with only 186 available overall. If you narrow that search to listed under a million there were only 105 available at the start of November… wow!
There were 56 overall house sales in October, so at that pace we would statistically only have a little over three months supply available. Currently there are 85 with pending contracts so it looks like November’s closing will be strong also.
Condo inventory is shrinking as well to now just 148 available. Of those 128 were listed under a million. Sales were strong at 41 units and pendings are holding with 64 waiting to close at the end of October, again making Novembers’ future look strong.
One issue other than putting pressure on prices that this inventory shortage trend creates is that buyers don’t have the selection they would like. This sometimes causes them to hesitate to make the leap and make an offer on what they are being shown. Opting instead to wait and see what comes on the market the next month. Unfortunately, sometimes nothing comes on the market in their criteria but sometimes if it does it is now out of their price range. Don’t wait, prices are going up!
When it’s time to sell your home, we highly recommend Gretchen. She made our move back to the mainland so much easier. She provided all the help necessary to ready our house for sale and was able to find just the right person to work on whatever problem we might have. She was available to answer any question we had at any time. We were in good hands!
~ Swend & Jackie Willadsen
Notes from Gretchen
The Department of Business, Economic Development, and Tourism, released the 4th quarter Statistical and Economic Report and it indicates that the overall economic condition of the state should remain stable into the next few years and predicted a growth rate of roughly 1.5% annually.
This is the best news we could hope for during the holidays. Stability means a lot to the real estate market as it does to other economic indicators. It is nice to know that we can look ahead with confidence into 2018 knowing that there is nothing on the horizon today that will change the course we are on.
Let me know if you have any real estate questions or concerns, I’m always happy to help!
Vacation Rental Changes
The County is working on changing the zoning code or taxation on vacation rentals and maybe both! This is a HUGE issue for those of you that rent out your properties full or part time. Their stated goal is to dissuade owners from doing short term rentals and encourage them to offer the properties as long term rentals instead.
However, if you look at the economics of converting a profitable vacation rental into a long term unit the differences can be extreme and could cause owners to sell their properties instead. This would create an even bigger issue in the general real estate market if a big group of vacation rental properties went up for sale simultaneously, stay tuned!
Kona House Inventory Listed Under a Million
More Economic News
- Hawaii’s air cargo industry has seen close to 1,000% growth over the last 15 years… wow! The study by the Department of Business, Economic Development and Tourism is reporting that employment and wages has followed suit with employees making an average of $37.47 per hour as compared to the state’s average per hour income of $23.76 as reported in 2016.
- Hawaii County’s unemployment rate has tied a 2016 record when it dropped to 2.3% in October… from a high of 11.1% in June of 2011… amazing!
- Cruise ship traffic has increased roughly 20% this year, over last year and they expect to see a bump in 2018 as well.
- I have been reporting lots of flights added to Kona’s airport for 2018 and now the state is predicting a 16% increase in the first quarter of 2018 for the state… that’s a heck of a lot more guests!
- Lumber prices are jumping dramatically across the States as rebuilding efforts get underway in hurricane-affected areas, not to mention all of the rebuilding needed in California from the fires. Developers here in Kona are warning that new home prices will increase in response to this shift. Labor shortages in skilled construction workers are also expected as they move off island to high paying temporary jobs.
- The Aloha State is ranked 3rd in WalletHub’s 2017 Happiest States of America.. woohoo!
Out On the Town
What a month or so it has been here! First off, I spent the day at Ironman in October again this year, which was a total blast! If you haven’t ever tried it, you need to… call me for tips on how to survive the long day but still get to see all the action. Here is my photo of the winner Patrick Lange while I’m standing at the finish line… so exciting!
We also were out at the Mauna Lani supporting VASH (Visitors Aloha Society of Hawaii) at their big gala fundraiser. A grand time was had by all and the music was fabulous! If you are here next year in November, you really should consider attending… they do wonderful work helping stranded and distressed tourists get home safely when tragedy strikes. A truly amazing organization!
And lastly, an organization near and dear to my heart, the Salvation Army’s Red Kettle Kick-Off event in Kona. Eighty-five percent of all funds raised go to help those in need and all funds raised on each island stay on each island. They serve 10,000’s of thousands of people each year with food, shelter, drug addiction, and more. Watching these selfless people serve those in need is humbling. For more info, just let me know… and Happy Holidays!
West Hawaii Real Estate Market Snapshot
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