COVID19 UPDATE
Hawaii Island

Interesting Stroll Down Memory Lane….

Pictured home: 16-4018 Ohiohi St. Kea`au

Looking back at my musing as we began the lockdown around this time last year, I was more concerned about homeowners taking proper steps to protect their biggest asset. Of course, none of us knew what to expect. Most, I’m sure, thought the COVID crisis would last only a few months. There’s no way any of us could have predicted or expected the bizarre spike in real estate sales that followed.

Hawaii Real Estate During COVID

The 2020 data included on the chart reflects pre-COVID sales; hence it fairly represents the pre-COVID market. Compare those to today’s numbers, and it’s a statistic that’s difficult to wrap your head around. Consider especially current inventory levels.

chart about hilo real estate market update

Inventory

At this time last year, Hilo had 102 homes for sale. There are now about half that many. This lack of inventory has driven prices up over 25%. Every neighborhood I track shows a similar trend. Projected demand (see chart) considers homes under contract along with those not yet moving to close (active). The reality is that most homes under contract will sell, which severely reduces the supply number. Of course, a lower supply puts upward pressure on pricing.

Builders are building as fast as possible, but most are faced with dwindling lot inventory. This, of course, means lot prices are creeping up, which in turn means buyers will be paying more across the board.

Where in the world?

I’m often asked where buyers are coming from. While many are West Coast and O`ahu buyers, local buyers are still in the mix. Local buyers rely heavily on zero down loan programs which makes it more difficult to compete. Watch this. Japan buyer activity dropped 61%* last year while Korean buyer activity dropped by 70%* which means once they return, pressure on demand will increase. There are many reasons to believe they will be back.

Plan Ahead

So, what’s a buyer to do? Your best chance of success is to find the busiest listing agent you can. Let them know you are in the market. They are in the best position to expose you to new inventory. Most sellers favor a buyer who has personally viewed the property. Be ready to pull the trigger because it doesn’t seem things are going to change any time soon!

Information provided by Hawaii Information Service and reported by Pacifi2c Business News

About the Author

Denise Nakanishi

Denise Nakanishi is a REALTOR Broker with Hawai'i Life. Denise Nakanishi is one of Hilo's most acclaimed real estate agents. She reached the rank of Major in the US Army and is now known by many as "Major Mom." The nickname fits–not only does Denise bring the discipline and mission-oriented attitude you'd expect, she's also caring and compassionate, always looking out for her clients like they're her own family. Having made the Big Island her home since 1987, Denise combines her extensive knowledge of the area with a sharp focus on customer service and the results speak for themselves. She's the recent recipient of the Best East Hawai`i, Best of Zillow, Chairman's Circle Award, President's Circle, Top Producing Agent since 2001, and Realtor of the Year awards. Denise stays ahead of the curve because she's passionate about education–she served as Education Chair for Hawaii Island REALTORS® for many years. She's one of Big Island's best real estate resources, known for her weekly article in the Hawaii Tribune Herald. Denise leads Team Nakanishi for Hawai`i Life, who is committed to their family, work, and community. In her little time away from work, Denise is a committed runner and Grandy. She also devotes many hours to various Veterans' Organizations, the East Hawaii Cultural Center, and the Hawaii Island REALTORS®. You can email me at denise@hawaiilife.com or via phone at (808) 936-5100.

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