LIHUE — Kauai Realtors are saying a lack of inventory on the Garden Isle will continue to push the prices of homes.
“That inventory base is dwindling from month to month,” said Hannah Sirois, Kauai Board of Realtors president. “We do have upward pricing pressure. I do not see that upward pricing pressure abating.”
Julie Black, Kauai Dreams Realty principal broker and owner, agreed.
“Home prices are appreciating on Kauai in general, but there is a cap that the local residents can afford,” Black said. “There’s strong demands for homes under $500,000.”
Through August, the median sales price for residential homes on the island stood at $630,000, which is up about 1 percent from last year.
But Black said the true market value of homes is saturated with the inclusion of homes on the North Shore and some oceanfront residences on the South Shore, which are costlier than residences on other parts of the island.
The median residential price in the Hanalei area is at a staggering $1.2 million. When you compare that to the median price in Koloa, the next expensive median on Kauai, it’s almost cut in half at $650,000.
“In Hanalei, North Shore, the homes are so expensive. A lot of sales in Kukuiula, those average $2 million to $3 million,” Black said. “There’s really a high disparity with the high-end vacation homes and prices that the residents are buying.”
There is, however, an upward trend of local buyers in the markets outside the North Shore — Kawaihau, Lihue, Koloa and Waimea — from last year.
“They are moving to where the inventory and lifestyle meets their family’s best (interests),” Sirois said.
The most sales have occurred in the Kawaihau district with a total of 108 sales. The largest increase of sales is coming from Koloa with 101 sales, up 62 percent from last year.
“The local buyer community is very much involved in the buying process on Kauai,” she said. “They’re taking full advantage of today’s interest rates.”
Black said most local buyers have a buyer cap of $500,000.
“You do have residents who can go higher, but I hardly find local residents who want to go over the $1 million mark,” she said.
A new report shows Hawaii has the nation’s highest average home prices as the cost of housing in the state has soared over the last year.
The 2016 Coldwell Banker Home Listing Report ranked states based on their average price for a home with four bedrooms and two bathrooms. Hawaii took the top spot with average home prices at nearly $905,000. That’s about $325,000 more than homes in the second-priciest state, Massachusetts.
Honolulu had the state’s highest average home prices this year at $1.2 million. The city ranked 14th among the nation’s municipalities, up from 17th in 2015.
The average price of a four-bedroom in Kapolei was listed at $708,000, up from $569,000 last year. In Ewa Beach, the average price is $653,000, compared to $597,000 last year.
The report found that the country’s most expensive market was Saratoga, California, where the average four-bedroom home costs $2.5 million. Detroit was ranked as the nation’s most affordable market, with an average four-bedroom home price of $64,000.
Coldwell Banker’s annual report includes data for more than 2,000 real estate markets nationwide.
According to real estate data obtained by The Garden Island, from June 2015 to June 2016, the average home price of 387 listings for sale was $2.2 million — with the highest listing prices at $30 million and the lowest priced at $225,000.
“When you’re really trying to get a sense of the Kauai market, you have to drill down a couple layers,” said Sirois. “You can’t just look at the overall median price of the market.”
Housing projects such as Ho‘oluana at Kohea Loa and Lima Ola may bring some relief to the market, Black said.
When completed, the housing developments are slated to add about 700 housing units.
“That inventory can’t come soon enough,” Sirois said. “In the interim, we will continue to see less at peak levels and prices increase.”
Because the majority of jobs are located in Lihue, demand for houses are strongest in that area, Sirois said.
Sirois said the community should take the county’s online survey and share their goal for long-term housing solutions.
“The worst thing that the KBR can do is advocate housing at any costs. We live on a beautiful island with a very high quality of life,” she said. “(With) thoughtful planning, working with the community, we can all end up with the right solutions together.”
When compared to the rest of the state, Kauai represents only 4 percent of the overall sales volume in real estate, Sirois said.
“When you look at the sales on this island, you’ll currently see a bent toward local residents who are acquiring the greatest number of properties, followed by second homes/investment purchasers who typically hail from the West Coast,” she said.
The Associated Press contributed to this report.