April Showers Bring Abundance to the Kauai Real Estate Market

The velocity of Kauai’s real estate market is staying strong as we move into the Spring season; April real estate closings are up 39% from 2009, while year-to-date sales are up 64%.

April of this year saw 64 real estate closings in Kauai, up from 46 in April 2009. Meanwhile, 2010 has seen a total of 218 sales compared to 133 this time last year. The sales breakdown for April 2010 includes 23 homes, 11 land, and 30 condominiums.

When you look at these transaction numbers, it appears we may be approaching the “go phase” of the tranquility segment of the market. Economists describe this tranquility phase of a real estate cycle as having a stop and go phase. In the stop phase, each month the number of transactions decreases. In the go phase the velocity increases and eventually, as inventory diminishes, prices start to rise. As real estate closings and year-to-date sales are in fact increasing over 2009, it appears we have entered such a “go phase.” Comparatively, the real estate bubble years of April 2005-2007 showed high numbers of transactions, but at a decreasing rate (151 in 2005, and 100 in 2007), thus reflecting a “stop phase.”

Sales volume is also up with a total of $47M for April 2010 compared to $27M for April 2009. And sales are not all that’s growing. Hawaii Life now has 64 agents statewide, and here on Kauai we have 92 listings with a property value of over $120M.

Needless to say, short sales and REOs continue to drive market velocity. Just under 30% of the sales were REO, Short Sales, or distressed. This includes the two luxury auctions at Kealia Kai for a home listed for $10M that sold for $3.1M, and a lot as well.

Kauai Number of Transactions – April 2010

Kauai Sales Volume through April 2010

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