Kona Kohala Blog

There has been very little activity in the sales of raw, undeveloped land in the last couple of years in these two districts, North Kona and South Kohala or North Kohala for that matter.  The problem is two fold; first, there is so much inventory of existing homes that buyers can get pretty close to their dream home with what's on the market now.  Second, even though labor costs have gone down, the cost of building supplies is still on the rise.  We've had a couple disasters that have put a large demand on building supplies coupled with ever increasing fuel costs and building materials in Hawaii are expensive.

What this means for the savvy investor is negotiable land prices.  There was a beautiful one acre lot in Kahakai Estates subdivision, wonderful views and close to town that was listed at $395K and sold for $310K, a more than 20% drop from asking price.  This is a great time to buy a piece of land and hold onto it until either it's time to build your dream home or the market turns and builders are again looking for good lots to build on.

Now, my current peeve . . . Our current administration is citing Franklin Roosevelt and the New Deal as a model for getting us out of the mess we find outselves in from decades of financial shenanigans since Reagan left office.  I predict the following quote will ring just as true in 7.5 years as it did when it was spoken over 60 years ago.  Henry Morgenthau, Jr., Roosevelt's treasury secretary said after 8 years of the New Deal, "we have tried spending money,  We are spending more than we have ever spent before and it does not work . . . We have never made good on our promises . .  I say after eight years of this Administration we have just as much unemployment as when we started . . . and an enormous bebt to boot"

An extensive study was conducted by UCLA economists Harold L. Cole and Lee E. Ohanian in 2004 and they said, " . . . ill conceived stimulus policies . . ." extended the Depression by seven years.

I can not for the life of me understand why our current administration embraces policies that have been proven not to work and turn their back on Reagan's policies which were proven to work in very similar circumstances.  What am I missing?

Developers are setting the prices on condos in both Mauna Lani Resort and Waikoloa Beach Resort these days.  Close on their heels are foreclosures, using developer prices as a guideline then undercutting them just enough to sell the foreclosure before the developer unit.

The developers have already made their money on their original sales where most buyers got taken to the cleaners.  It's not like there was a choice back then, if you wanted the property you paid their bloated prices.  Today, the developer could give away the remaining units and still walk away with a nice profit on the project.

Keep an eye on Hali'i Kai and Ka Milo, two very nice properties where prices for developer units and foreclosed units keep dropping lower and lower.  Either of these should be quick to recover in value when the market picks up again.  Currently prices are under $400K for a 2 bedroom, 2 bath unit.  If you're interested, contact us and we'll give you information on the projects and the area, if you're not familiar with it.

Now, about Dr. Norman Vincent Peale.  He wrote a book at about the time President Jimmy Carter was making a mess of the country.  I came across an interesting paragraph he penned that is as applicable today as it was then.

"An effort is being made by some gloom artists, self-styled intellectuals, to sell Americans on the erroneous notion that since there is a disparity of wealth in this country, it should be taken from some and given to others by political action, and that thereafter everything will be just sweetness and light.  Totally ignored by these social babes-in-the-woods is the fact there is another way to distribute wealth, namely, get an idea, develop enthusiasm for it, and just  plain go to work to build it into reality.  There's nothing in the world that can activate prosperity like that formula!"

Two good buys just came on the market.  The first is in Casa de Emdeko, an ocean front complex compete with a fresh water and a salt water pool.  This is a 2 bedroom, 2 bath unit with a very nice remodel.  The price is $465K.

The other listing, this week's Best Buy of the Week in our Aloha Friday newsletter, is in Country Club Villas in Keauhou.  This is a third floor, loft unit with expansive ocean views looking over the 18th fairway of the ocean course of the Keauhou Kona Country Club.  This unit needs a cosmetic face lift but is priced $60,000 below the next lowest priced loft unit there.  Needless to say that much money can go a long way to redoing the condo.

The Casa unit is MLS #224500 and the Country Club Villas is MLS #224640.

Laugh of the Month has to go to Secretary of the Treasury Timothy Geitner.  Speaking before a large crowd at the university in Bejing he was telling the audience how strong the U.S. economy and the dollar was and how well our recovery is going.  The crowd burst out in laughter leaving Mr. Secretary blushing at the podium.  Funny he'd think the rest of the world is as gullible as most Americans.