Kona Kohala Blog

Whether it's a buyer's market or a seller's market all depends on the price range you're looking at.  It is commonly believed that having a 6 month supply or inventory or Single Family Residences (SFR's) or condos or land signals a balanced market, one favoring neither buyers or sellers.

I broke down the market into rough categories, one looking at SFR's and condos priced to $400,000 and another from $400K to $1M just to see if there were any marker differences in the supply amounts.  Supply is determined by dividing the number of sales over the last 12 months by 12 to get an average for the year of monthly sales.  That number is then divided into the number of active listings which gives the number of months it would take to sell all listed properties with no new ones coming on the market.

When we do that and look at all properties regardless of their prices we get a 9.2 month supply for both SFR's and condos in North Kona.  In South Kohala we get 10.4 months for SFR's and 10.2 months for condos.  This indicates a fairly strong buyer's market with excess inventory out there.

If we first look at the range of properties from $400K to $1M we find in North Kona that there is a 10.7 month supply of SFR's.  Condos have a whopping 18.6 month supply, a very strong buyer's market where there should be lots of negotiating on price.

In South Kohala there is and even stronger buyer's market for SFR's with an 18.9 month supply.  Condos in South Kohala have a 9.9 month supply, still a pretty strong buyer's market.

Looking at properties priced up to $400,000 we see a slightly different story.  In North Kona there is only a 3.5 month inventory of SFR's on the market, a strong seller's market and why we've been seeing the median price rising in this category for the last couple of months.  SFR's in South Kohala are closer to a balanced market with a 5.5 month supply but still in the seller's market group.  Condos in South Kohala are at a 6.2 month supply, just barely into buyer's market territory while condos in North Kona are at a 9.4 month point, pretty much a buyer's market here.

These numbers back up what we've been seeing in the market all along and explains the high sales of lower priced properties and the continued decline in prices with the exception of North Kona SFR's.  Activity has slowed somewhat as the world heads to hades, or so it seems at times.  We haven't had this much bad news at one time since Tylenol was tainted, Nixon stepped down and Laugh In ended it's run on television.  With the middle east in flames and Japan suffering a triple whammy, earthquake, tsunami and nuclear melt down, things look pretty bad.  But remember, it's always darkest before the dawn so we should be in for some good news after all this darkness.