The Real Estate Market is Doomed, Buy Property in Hawaii

Katie Minkus, R(B), Broker-in-Charge Big Island Sales

It’s a GORGEOUS DAY, Mr. Beall – glad you’re out enjoying it!! Have fun at the beach, I’m going to follow your lead and go commune with the honu myself…

It’s a GORGEOUS DAY, Mr. Beall – glad you’re out enjoying it!! Have fun at the beach, I’m going to follow your lead and go commune with the honu myself…

Hey, Mike Arrington enjoys his vacation in Kauia – maybe you should have mentioned him in your blog post too aside from Tony Robinns 😉

Hey, Mike Arrington enjoys his vacation in Kauia – maybe you should have mentioned him in your blog post too aside from Tony Robinns 😉

OK, I do know how to spell Kauai – that was a typo 😀

OK, I do know how to spell Kauai – that was a typo 😀

Beth Thoma Robinson R(S)

Matt, to your point on pricing: one of my favorite non-Hawaii Life agents told some sellers of mine that the only two leverage points they had were price and exposure. He continued on to add that Hawaii Life was giving them the exposure, so if they weren’t getting offers, the answer was to become more competitive in pricing.

They decided instead to take the home off the market…and a few months later, thanks to our exposure advantage, I received an inquiry about whether they might still be interested in selling. The offer they accepted wasn’t what they had hoped for a year ago, but one that looked very healthy compared with the few REOs in our area.

I guess what I’m trying to say is that I agree 100% that REOs are having an impact and we need to be conscious of them in our pricing because savvy buyers and appraisers will be… but that doesn’t mean our Smart Marketing is no longer advantageous for Sellers.

Beth Thoma Robinson R(S)

Matt, to your point on pricing: one of my favorite non-Hawaii Life agents told some sellers of mine that the only two leverage points they had were price and exposure. He continued on to add that Hawaii Life was giving them the exposure, so if they weren’t getting offers, the answer was to become more competitive in pricing.

They decided instead to take the home off the market…and a few months later, thanks to our exposure advantage, I received an inquiry about whether they might still be interested in selling. The offer they accepted wasn’t what they had hoped for a year ago, but one that looked very healthy compared with the few REOs in our area.

I guess what I’m trying to say is that I agree 100% that REOs are having an impact and we need to be conscious of them in our pricing because savvy buyers and appraisers will be… but that doesn’t mean our Smart Marketing is no longer advantageous for Sellers.

Meghan Clair

Great Blog Post Matt! Your response to the overgeneralized NYTimes article is right on. There is a more positive picture for buyers and sellers in our Hawaiian marketplace as clearly noted in your stats and Paul’s recent economic update.
The upcomming high season on Maui should prove you correct!

Aloha,
Meghan Clair
Coldwell Banker Island Properties-Shops at Wailea

Meghan Clair

Great Blog Post Matt! Your response to the overgeneralized NYTimes article is right on. There is a more positive picture for buyers and sellers in our Hawaiian marketplace as clearly noted in your stats and Paul’s recent economic update.
The upcomming high season on Maui should prove you correct!

Aloha,
Meghan Clair
Coldwell Banker Island Properties-Shops at Wailea

Beth- I couldn’t agree more. I think the point about price and exposure is exactly right. And, it has to be both. All the Smart Marketing in the world doesn’t amount to much if the property isn’t priced right… and, conversely, even aggressively priced properties take longer to sell if they’re not marketed properly.

Different markets seem to be reacting to the REO influx differently. Here on Kauai, there are a lot of sellers with their heads still in the sand. On Maui, though, its a lot harder to be in denial, since the news of foreclosures and REOs is so prevalent.

Beth- I couldn’t agree more. I think the point about price and exposure is exactly right. And, it has to be both. All the Smart Marketing in the world doesn’t amount to much if the property isn’t priced right… and, conversely, even aggressively priced properties take longer to sell if they’re not marketed properly.

Different markets seem to be reacting to the REO influx differently. Here on Kauai, there are a lot of sellers with their heads still in the sand. On Maui, though, its a lot harder to be in denial, since the news of foreclosures and REOs is so prevalent.

Pattie Freeman, R

September 8, 2010

Matt,

I like your idea of growing your own food and going to the beach! One of the beautiful things of living in Hawaii is that we don’t have to have air conditioning and heating!
Hawaii will always be a wonderful place to live and own real estate. It is a wonderful time to buy a piece of paradise!

Pattie Freeman, R

September 8, 2010

Matt,

I like your idea of growing your own food and going to the beach! One of the beautiful things of living in Hawaii is that we don’t have to have air conditioning and heating!
Hawaii will always be a wonderful place to live and own real estate. It is a wonderful time to buy a piece of paradise!

Justin - Head Web Head

There are deals everywhere. I’m buying everything I can get my hands on.

Justin - Head Web Head

There are deals everywhere. I’m buying everything I can get my hands on.

Herb Grabell

Mahalo Matt! Life is short and those of us who live in Hawaii are very fortunate! No matter what cycle the real estate market finds itself, it is important to keep the eye on the big picture; quality of life, quality of life and quality of life. I applaud Hawaii Life’s efforts to spread the word in a smart effective manner. As we invite new arrivals to escape the rat race, we also must keep in mind we need to give back and keep our amazing Hawaiian Islands special. We are excited to include Hawaii Life, Jan & Katie on Hawaii Island as part of our team to promote the Hale Kuleana smart energy efficient building program. Please check it out http://www.halekuleana.com. It’s all great in the Islands no matter what the economy throws at us! Aloha

Herb Grabell

Mahalo Matt! Life is short and those of us who live in Hawaii are very fortunate! No matter what cycle the real estate market finds itself, it is important to keep the eye on the big picture; quality of life, quality of life and quality of life. I applaud Hawaii Life’s efforts to spread the word in a smart effective manner. As we invite new arrivals to escape the rat race, we also must keep in mind we need to give back and keep our amazing Hawaiian Islands special. We are excited to include Hawaii Life, Jan & Katie on Hawaii Island as part of our team to promote the Hale Kuleana smart energy efficient building program. Please check it out http://www.halekuleana.com. It’s all great in the Islands no matter what the economy throws at us! Aloha

Kathy Awai

September 10, 2010

Matt, I couldn’t agree with you more and everyone else who commented are also correct. Living in Hawaii for 28 years, I have never seen a market quite like this but I also have never seen so many real estate opportunities. This is the time to buy and we live in such a unique place; we are lucky! On the other hand, I agree the REO’s, Short Sales, etc, are having a direct impact on Sellers. Smart Sellers are pricing their properties correctly and that is the name of the game for now. As supply dwindles, demand will step in but hey, if all else fails, grab your beach towel and go enjoy; wow, are we lucky to live aloha in Hawaii. Just yesterday I was in N. Kohala, and it was picture perfect; couldn’t be better.

Kathy Awai

September 10, 2010

Matt, I couldn’t agree with you more and everyone else who commented are also correct. Living in Hawaii for 28 years, I have never seen a market quite like this but I also have never seen so many real estate opportunities. This is the time to buy and we live in such a unique place; we are lucky! On the other hand, I agree the REO’s, Short Sales, etc, are having a direct impact on Sellers. Smart Sellers are pricing their properties correctly and that is the name of the game for now. As supply dwindles, demand will step in but hey, if all else fails, grab your beach towel and go enjoy; wow, are we lucky to live aloha in Hawaii. Just yesterday I was in N. Kohala, and it was picture perfect; couldn’t be better.

http://online.wsj.com/article/SB10001424052748704505804575483844277697242.html

September 13, 2010

I just saw this (confirming) article in the Wall Street Journal:

“Banks’ Plans for Foreclosed Homes Will Drive Market”

http://online.wsj.com/article/SB10001424052748704505804575483844277697242.html

September 13, 2010

I just saw this (confirming) article in the Wall Street Journal:

“Banks’ Plans for Foreclosed Homes Will Drive Market”

Matt, great blog!

Matt, great blog!

Matt,
The market does seem to indicate a creative-destruction
pattern. As home owners suffer the losses of homes they once could afford it creates windows of opportunity. It also has another effect which is the fear of the unknown. Sellers who can’t compete with REO or Short Sale pricing would like resolution on when they might be able to liquidate at a fair price. Buyers who may have never had the chance to purchase are in a great position as long as financing is available. It is clearly the time to purchase with banks still funding. If the money isn’t available to lend anymore then we will all be
in a situation.

Diane Chavez

September 23, 2010

Matt,
The market does seem to indicate a creative-destruction
pattern. As home owners suffer the losses of homes they once could afford it creates windows of opportunity. It also has another effect which is the fear of the unknown. Sellers who can’t compete with REO or Short Sale pricing would like resolution on when they might be able to liquidate at a fair price. Buyers who may have never had the chance to purchase are in a great position as long as financing is available. It is clearly the time to purchase with banks still funding. If the money isn’t available to lend anymore then we will all be
in a situation.

Marc Brodeur

Don’t get me started Matt.

If you want old news, look at a newspaper or the media. By the time it has filtered to them the opportunity has passed (if the article was about an opportunity), or the information is so old it might as well be in a library. Their other trick to create bad news is to post whatever statistical numbers look bad. So when month over month sales were getting better, they switch to March/09 vs March/10 which looked worse. When year over year looked better but there was a monthly dip, they went back to month to month reporting. The digital age has destroyed journalism and made it borderline irrelevant so they have to be sensationalistic now to attract attention. You literally have to rely on industry specific bloggers to get “news.”

I’m ready to move to Hawaii…..Maui specifically!

Marc Brodeur

Don’t get me started Matt.

If you want old news, look at a newspaper or the media. By the time it has filtered to them the opportunity has passed (if the article was about an opportunity), or the information is so old it might as well be in a library. Their other trick to create bad news is to post whatever statistical numbers look bad. So when month over month sales were getting better, they switch to March/09 vs March/10 which looked worse. When year over year looked better but there was a monthly dip, they went back to month to month reporting. The digital age has destroyed journalism and made it borderline irrelevant so they have to be sensationalistic now to attract attention. You literally have to rely on industry specific bloggers to get “news.”

I’m ready to move to Hawaii…..Maui specifically!

Matt

@ Marc, we see the same trends in reporting in Hawaii… and the tendency towards sensationalism is even more interesting in a media market where there are literally NO competitors for the news. Each island/county has its own newspaper… yet they continue to operate as if they have to use sensationalism to sell more papers, as if we have a choice.

Interestingly, after this post, the Honolulu Star-Advertiser reported on Thursday, Sept. 16th, that Hawaii’s foreclosure filings (per month) hit an all-time high in August.
http://www.staradvertiser.com/news/20100916_Foreclosures_hit_all-time_high.html
Lucky for you, Marc, Maui had the worst foreclosure rate… so maybe now’s your time to move to Maui.

Matt