Howʻs the Real Estate Market? North Hawaii and the Kohala Coast

One great thing about being with Hawaiʻi Life since we first opened on the Big Island, and having around 500 articles on the website, is that I never lack for new buyer clients. Prospective buyers reach out after reading a blog post relevant to the particular kind of property or neighborhood of interest to them, whether it be a B&B or vacation rental, coffee or macadamia nut farm, or equestrian estate. But the first question is always “Howʻs the real estate market in (fill in the blank)?”

The Kohala Coast and North Kohala are popular for the climate and ocean views: this is a Puakea Bay Ranch equestrian estate

The honest answer is that it has never been harder for a serious buyer to find an available property meeting their criteria – pretty much anywhere in Hawaiʻi. I hear this is no different from most real estate markets on the continent. And with the lowest listing inventory ever and extraordinary demand, we are seeing the highest prices ever for many neighborhoods.

Real Estate Listing Statistics for North Hawaii and the Kohala Coast

Letʻs start with North Kohala, including both the luxury gated communities near Kawaihae like Kohala Ranch and Kohala by the Sea, and the neighborhoods near the rural towns of Hawi and Kapaʻau. In total there are currently only 14 active residential listings in North Kohala. For comparison, when I wrote the 2019 reports in early 2020 (two years ago), the upper North Kohala area alone had 39 active listings and there were another dozen listings in the lower communities.

The average price point for the fourteen current home listings is nearly $2 million since the inventory is dominated by the upper end:

Two years ago, there were listings under $400,000 available for first time buyers. Now the lowest priced homes available are 75% above that level.

There are two current listings for the lowest price, $699,000. One, a Hawaii Life listing, is a 732 sq ft plantation-era home on a 15,000 sq ft lot. The other is in the modest neighborhood of Ainakea. In other words, the asking prices on these homes are double what they would have been 2-3 years ago, thus pricing out local buyers from the market. Meanwhile rents are also rising so these properties are still attractive as long term rentals even at todayʻs prices.

Real Estate Listing Statistics for Kohala Coast Resort

Across Hawaiʻi we are hearing that as residential neighborhood listing inventory shrinks, those buyers are turning to resort properties they might not have otherwise considered, contributing to the diminished inventory there.

For residential listings on the Kohala Coast, there are only three options: a home for sale by owner on the non-oceanfront side of Puako; and two homes UNDER CONSTRUCTION in Kaunaʻoa in Mauna Kea Resort. If you are looking at the $7-8 million price point, donʻt let the fact that these are homes under construction intimidate you. I just sold a partially-built home at nearby Ke Kailani at Mauna Lani Resort and the buyers are enthusiastic about their decision and being able to be a part of the process.

There are still two active listings at beachfront Kolea at Waikoloa Beach Resort — my value pick in this hot market.

The condo market is equally tight. There are only a dozen listings between Mauna Kea Resort, Mauna Lani Resort, and Waikoloa Beach Resort — area where in a typical year we would have seen a dozen listings at each community like Kolea or Haliʻi Kai alone! In the resort market, the lowest priced condo listing is at $790,000 and the highest is at almost $4 million.

The other truly extraordinary figure is the days on market – these are all quite new listings, as desirable units get snapped up quickly. On the other hand, many of these new listings appear to be testing just how desperate is, with asking prices more than 50-100% above previous sales of similar units.

Where is the North Hawaiʻi (Big Island) Real Estate Market Headed?

As I have mentioned before, what really differentiates the 2022 real estate market from the situation in the 2005-2007 market peak is that we had new developments in the resorts, Waikoloa Village, and Waimea bringing on new inventory to meet the high demand. Prior to the pandemic-driven shift in the real estate market, developers here were anticipating the end of the longest economic expansion in history and a downturn, therefore not bringing new housing to market.

A second phase of homes is being marketed to current owners at Ainamalu, prices $2,950,000 to $4, 200,000

There are a few new offerings slated. A second phase at Ainamalu in Waikoloa Beach Resort; new options in Waikoloa Village come to mind. And in residential areas, as always is the case with moving to Hawaiʻi, a percentage of people who made the move two years ago might just be finding they are missing things they valued where they came from and ready to make the move back home.

But that does not indicate that we expect to see dramatic downward pressure on prices. So if you are a serious buyer, get your ducks in order to be ready to offer competitively as soon as you see a listing you like, and accept that last yearʻs prices are history. Look for relative value in todayʻs market, and that includes the value that you as a buyer personally place on the particular home or condo that most closely meets your criteria.

And if you are a seller reading this – you have been inundated by mailings from real estate agents saying this, but it is true so Iʻll state the obvious. There has never been a better time to sell your Hawaiʻi property.