Newsletter

West Hawaii Real Estate Update: May 2023

Volume 20, Issue 5

The closed sales in Kona for April performed as expected. Typically you can count on roughly 50% of the pending contracts to close each month. So when you end March with 130 in escrow you should close 60-70 properties in April. We closed 72.  That leaves some hope that May will be a strong closing month as well with 143 pending contracts at the end of April.

Inventory is shrinking! That means even less to consider if you are a buyer and as a seller it gives you some strength to negotiate if you have something a buyer likes. However, we are seeing sales close at less than asking probably 80% of the time, even if it is a small difference.

If you want to buy a house with a loan and the average price under a million is $787,000, you put 20% down ($157,400) and borrow $629,600. That will leave you with a monthly payment to the bank of $4,000 at 6.5% interest.  And you still must cover property taxes, utilities, insurance, and maintenance costs. That is a huge payment and would require an income (with no debt) of roughly $120,000  a year.  Not many who live in Kona now can or want to afford that. Yes, in the long run “it’s better to own than rent,” but  qualifying is the tough part… so less buyers in the market with loans. We are still seeing cash sales in the 50% range, makes sense!

Testimonial

My experience working with Gretchen was 5 star! She has excellent communication skills, was very responsive, knowledgeable and helpful and both our transactions went very smoothly. She helped me with both selling and purchasing a condo. She has a great program in place for listings that eliminates potential problems in advance. Her knowledge and ability to stay on top of things made for successful transactions. I highly recommend working with her!

L. Charpentier

Kona Cash Sales: Houses – Condos – Land from 1992 to 2023

Economic News

  • Visitor arrivals for the state are up 14% over 2022 and down only 3% against 2019. Suffice it to say 900,000 people arriving in a month is a lot!
  • Hawaii Island saw 161,200 for March 2023.
  • There are 2 million fewer workers in the US labor force than there were before the pandemic. One key reason: retiring baby boomers!
  • Arrivals breakdown from February surveys as follows, although rounding was used on the numbers:
    • 81% On vacation
    • 4% Wedding/Honeymoon
    • 5% Meetings/conventions
    • 12% Stay with friends/family
  • Hawaii has ranked #7 on a list of states with the highest credit card debt, Lending Tree’s statistics say.
  • Tripadvisor has ranked Hawaii Island #11 on its most popular travel destinations. Oahu was #3, and Maui was #4.
    Uncle Billy’s iconic Kona Bay Hotel, built 60-years ago, has started its $34 million renovation to become a Hampton Inn.  It was purcashed last year for $21 million.
  • The shopping center anchored by Safeway has sold to a local commercial real estate company for $66 million, less than it was built for by some estimations.
  • Hawaii homeowners insurance rates are going through the roof in 2023. Aging roofs, costs to rebuild, the time it takes to rebuild have all added to these increases. Some as high as 37%!

Notes from Gretchen

I saw the craziest list of state visitor arrivals on the news the other day. Check it out!

1951           50,000
1955         100,000|
1964         500,000
1967         1 million
1972         2 million
1976         3 million
1982         4 million
1986         5 million
1993         6 million
2005         7 million
2013         8 million
2017         9 million
2019       10 million

It took 33 years to go from 5 million visitors a year to 10 million. It took 68 years to go from 50,000 a year to 10 million… wow! When you consider Hawaii has less than 1.5 million residents today, that’s a whole lot of guests!

Real Estate Wire Fraud

Rentals in Kona

Available Now

Kona Sea Ridge 2BD/2BA with Den Tastefully furnished, AC, upstairs, peek of ocean.
Kona Sea Ridge 2/2 with Den Furnished and updated… Upstairs condo with AC and Ocean View
Kona Sea Ridge 2/2 with Den Furnished and updated… Upstairs condo with AC and Ocean View

Thought for the Day

“Price is what you pay, value is what you get.”

~ Warren Buffett

Out on the Town

A look at my business cards (and hairstyle changes!) from 2008 to now.

A long time newsletter reader asked me to come and talk to her and her husband about selling their condo. I remembered her well from our chance encounters over the years and readily agreed. They were a couple of characters… she in her late 80’s and he in his early 90’s! And what I saw on the kitchen counter shocked me… it was my business card from 2013! Somehow they had kept it all these years! I asked if I could trade them for a new one and they let me, and my 2013 card is now proudly displayed on my desk.

I thought it would be fun to share my timeline of business cards (and hilariously, my timeline of hairstyles) with you. They say that Realtors don’t change their photos often enough, and I can honestly say I never wanted to do that and have always updated my photo every five years or so. It is also a great reminder to never ever change your phone number since the one on the card they had was the office line I had disconnected and forwarded to my cellphone years ago!  

The next photo update is still a few years away… stay tuned!

West Hawaii Real Estate Market Snapshot

Quicklinks

Mahalo!

As always, thank you for subscribing and reading my monthly newsletter! If
you have any real estate questions about West Hawaii please feel free
to call or email me today!

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