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Market Update: Home Sales in Hawaii Don’t Mimic the Mainland

People love to talk about real estate. In fact, it’s such a popular topic that each day seems to bring another confusing headline. This week the big deal was a nationwide decline in home sales during February. Well, duh…agents can’t even find the front door due to all the snow in half the country right now. Lucky we live Hawaii because cold people seek warm climates, which is about the only effect mainland weather has on our real estate market.

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Photo Courtesy Freedigitalphotos.net/Nuttkit

In comparing the first 2 months of 2014 to this year, the number of residential sales island-wide jumped over 10%. Prices increased 7.8%. Puna residential sales numbers were down 3.6% with year-to-date prices increasing a modest 3.2%. Given much stronger numbers elsewhere, it seems Puna is really suffering from an on-going “lava effect.”

South Hilo year-to-date numbers are up a whopping 60% with prices jumping 14% this year over last. The sampling for N. Hilo was too small to be statistically significant. Truthfully, even a 2 month look-back may not mean much.

Is it a Good Time to Sell?

Here’s the thing, REALTORS® are as busy as we can be. So, is it a good time to sell? Well, it depends. As you see from the data above, Puna numbers are not in line with the rest of the market. Sellers impacted by unknowns related to the lava flow should probably sit tight.

Here are a few tips if it’s time to sell. Each year, the National Association of REALTORS® aggregates data regarding renovation projects that provide the highest return on investment. Historically, kitchen and bath upgrades help move property. Creation of home offices, man caves, and media rooms make the list from time to time. Then there are unconventional lists that include steel front doors and back-up generators. Any such improvements are supposed to bring a high return on investment.

In Hawaii, adding a lanai probably tops the list of desirable major projects. I’m often asked if photovoltaic systems add value. While they may add value on an appraisal, I haven’t really seen buying decisions based on the presence of a PV system.

How to Get the Best Return on Your Reno

According to RISMedia (Mar 1,2015), home renovation projects are up sharply. This could likely indicate that sellers who have been holding back are now positioning themselves to sell. But what’s a seller to do if the budget doesn’t support a new tricked out kitchen? Make it shine!

Here are a few inexpensive improvements that any homeowner can make:

  • Cleaning and de-cluttering costs little more than elbow grease, but the return on investment can be a whopping 586% – so clean your house! After all, buyers need to see what they are buying.
  • Landscaping is another low-cost project that brings a major return on investment (258%), so take time to tame the jungle!
  • Upgrading (vs major renovation) kitchens and baths returns about 169% of a seller’s investment. In Hawaii, replacing carpeting with climate-friendly solid surface flooring is another great upgrade.
  • Paint, paint, paint…it’s inexpensive and always pays a major dividend!

 
Remember, contemporary buyers virtually move themselves into a property long before their foot hits the ground. Addressing projects that makes yours shine is really the best way to ensure your home will be part of the “sold” statistics in record time!

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