Although the Kohala Coast resort condo market overall continues to look strong heading into the fourth quarter, sales of condos at Halii Kai at Waikoloa seem to have temporarily stalled out. There are currently 19 condos listed for sale (versus 13 condos for sale at the start of the year) and not a single one in escrow.
As I noted in my 2013 summary of Halii Kai sales, the usual rule of thumb for a balanced real estate market is six months of inventory. Less than that indicates a seller’s market with rising prices. More than that indicates a buyer’s market with downward pressure on prices. What I pointed out in my January article was that with very different view profiles within the Halii Kai community, the analysis is a bit more complex.
Upgraded doors with disappearing screen maximizes golf/ocean view at Halii Kai 8D (MLS# 267248)
Halii Kai Profile of Sales Versus Listings
While there is actually some appreciation in sales price year-on-year for similar location/view sales, the majority of sellers are asking $1 million or more, while the majority of buyers are at the lower price points. Thus, the inventory of available Halii Kai condos continues to grow.
Here is what has actually sold at Halii Kai, year-to-date:
|Summary-Halii Kai 2014 Sales through September|
|MLS Sale $||9||$415,000||$1,300,000||$788,444||$780,000||N/A|
|DOM to sale||9||86||391||180||176||N/A|
|SP to LP %||9||93.2%||100.0%||96.3%||95.8%||N/A|
|Summary–Active Halii Kai Listings|
To really bring this point home, going back to the beginning of 2013, there have been a total of 22 Halii Kai condos sold. Of those, nine sold for less than the $525,000 asking price of the lowest priced listing at Halii Kai today (MLS# 268826).
Sweet Coconut Grove 2-bedroom condo is lowest priced listing at Halii Kai – fully furnished, never rented
Another eight units sold for less than the average sales price this year ($780,000)…or in other words, more than three-quarters of the sales were under $800,000. Putting location/view aside, that means the seven units priced below this year’s average have a decent chance of selling in the next year.
Only four sales were over $1 million during a 20-month period…and there are 12 active listings from $999,000 up. So we have a 5 or 6 year supply of the upper end at Halii Kai, if the buyer profile doesn’t change.
Why Halii Kai Ocean View and Oceanfront Sellers Won’t Drop Prices
Ironically, all the sellers in the under $800,000 listing range at Halii Kai are asking more than they paid; most can actually make a profit even with furnishings included. On the other hand, because the developer started construction and sales in 2005 at the oceanfront and worked back, those better view properties were sold at the peak of the market. With very few exceptions, sellers will be losing money on those $1 – 2 million listings at Halii Kai, even if they get a full price offer.
For example, oceanfront ground floor 3 bedroom 14H is listed for $1,395,000 fully furnished. The developer actually leased this back from the owner as a model because it was so nicely done. The seller paid over $2 million before furnishings. My guess is with furnishings and upgrades, the seller is only asking 65% of what he has in it.
Listen to whales blow and splash from the master bedroom of Halii Kai 14H oceanfront condo (MLS# 263611)
Unfortunately, many of the oceanfront units just aren’t presented well in the MLS photos that syndicate out to broker and third party websites. And as buyers it is difficult for you to get the background on a particular unit. If you are looking for a value purchase, or just the best option for your particular needs and budget, our team would be delighted to help.
A hui hou,
Beth Thoma Robinson, R(B)
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