Kona Kohala Blog

March numbers have dropped if looking through the eyes of the buyer.  Year to date, however, things are still looking pretty good.  Compared to last March, sales of Single Family Residences (SFR's) are down <20%> and condos are off <3.6%> while up north in South Kohala, SFR's are down by <14.3%> and condo sales are down <5.9%>. 

If we look at the year to date numbers, things look a little better for buyers with North Kona SFR sales up 6.3% and condos up 4.1%.  South Kohala is looking much better for sales with SFR's climbing 27.3% and condos jumping 62.9%.

This March's median price is looking good for buyers with SFR prices in North Kona dropping by <6%> over last March and condos prices down <39.6%> from last March.  It's surprising more buyers aren't jumping into the market but rumors of continued declines may be keeping them on the side lines.  In South Kohala the median price of a SFR is down <29.7%> from last March and condos are down <33.3%>.

The year to date median price is in lock step with the exception of North Kona SFR which instead of dropping are still rising if we look at year to date numbers.  SFR in North Kona is up 2.6% for the year but condos are down by <34.4%>, quite a difference.  In South Kohala the year to date numbers are both down with SFR's off by <11.7%> and condos off <24.9%>. 

The big brains on the mainland keep talking about another 10% to 15% drop in median price before we see bottom however, the Hawaii market can be so much more volatile.  With all that's happening around the world today it's hard to predict where this market is going.

Bottom line is people need to invest their money somewhere.  Banks are giving practically nothing in return for deposits or ever CD's.  The stock market is very unpredictable right now.  Some of the pros believe the bear we're seeing today is only temporary and that historically, after a 2 year bull, you are guaranteed a third year of rising prices.  In bonds, as long as Bernanke and crew keep the lid on interest rates there will be only occasional interest in buying them.  Returns are just barely above what we're seeing in the banks and that won't even keep up with inflation.  So, where to put your money?

Real Estate Investment Trusts (REIT's) are getting a lot of bad press because the sector is so over built right now.  Without banks, stocks, bonds or the hybrid REIT's to bet on, what's left.  Well, there is one sector with historically low prices, historically low interest rates for those wishing to enter this sector and a good variety of instruments to choose from.  You guessed it, residential real estate.  If you'd like to know more about it, contact me.  Let's see if it's right for you.  It's not going to cost you anything to explore this rich and often rewarding investment possibility.  Working with your financial advisor or tax planner and a lender of your choice, who knows what kind of deal we could come up with.  It's your future and you can never have too much information.