Home sales, prices rise in 2018

  • Caleb Loehrer / The Garden Island

    A Lihue home for sale stands ready for buyers.

LIHUE — Last year was a relatively good one for real estate on Kauai, but momentum slowed toward the end of the year, and Realtors on the island expressed differing opinions on how the housing market will fare this year.

“It was a pretty robust year,” Kauai Board of Realtors President Kelly Liberatore said when asked to sum up the real estate market in 2018.

According to statistics compiled by Hawaii Information Service, which maintains a database commonly used by Realtors statewide, both the volume and the median price of home sales on Kauai increased from 2017 to 2018.

Last year, 596 single-family homes sold for a median price of $699,500, up 6 percent from 2017, when 550 total units sold for a median price of $660,000. Condo sales figures followed a similar pattern. There were 481 condos sold in 2018 — up from 451 the year prior — at a median value of $465,000, compared with $435,000 in 2017.

But that upward trend appeared to reach its peak toward the end of last year, echoing a slowdown seen in housing markets across the U.S., and potentially marking the beginning of a leveling-out period.

“We’re all kind of sensing things are going to get harder in 2019,” Liberatore said. She and her husband Mike Liberatore — both Realtors on Kauai with Coldwell Banker Makai Properties — gave their assessment of the local real estate market in an interview last week.

The Liberatores said that as the year came to a close, they started to notice some “buyer resistance,” meaning prospective home buyers were more hesitant to pay the listed asking price. Homes began to spend more time on the market and negotiations grew tougher.

According to the Liberatores, part of that can be explained by the spread of information.

“We’re seeing way more informed buyers,” Mike Liberatore said.

He and his wife agree that there isn’t much room for prices to continue upward, and predicted a continued stall in the housing market at least through the first part of 2019.

Ron Margolis, a broker with eXp Realty in Kapaa, said he noticed the slow down late last year as well, and expects it to continue possibly even beyond 2019.

“I don’t think there’s much more upside,” Margolis said Wednesday.

According to Margolis, it was a seller’s market through most of 2018, with limited inventory on the island being sought after by people who were willing to pay prices very near asking price. Single-family homes and condos went for about 97 percent of the asking prices last year.

Margolis explained that as homes sit unsold for longer periods of time and a relatively greater number become available — as is becoming the case on Kauai — the market starts shifting in favor of the buyer, who now has more leverage and options to choose from when selecting a new house.

Looking ahead, Margolis cautioned prospective buyers to be aware that it could be some time before their newly acquired property gains significant appreciation. His advice for people thinking about selling their home is not to hold their breath in anticipation of more favorable conditions.

“You need to ask yourself, ‘How long am I willing to wait?’” he said.

But not everyone is so pessimistic. Kapaa Realtor Kimberly Estrella said she too noticed a decline in market activity toward the end of the year, but she sees no reason to expect that prices won’t rise again in 2019.

Estrella pointed out that median home sales in the mid-range market she deals with have consistently gone up by around 5-7 percent for the last few years, and said she believes that upward trend will continue.

“Of course, I don’t have a crystal ball, but I’m not seeing anything that would indicate a major slowdown,” Estrella said. “I don’t think there’s going to be a major change between this year and last year.”

The greater concern for Estrella is not whether buyers transplanted from the mainland will continue to pay increasing home prices, but how those prices are affecting the ability of local residents to pay for homes.

“As a Realtor, I find it sad that there is not enough affordable housing on island for our local residents,” she said.

And according to Estrella, affordable housing rates, which are based on median home sales figures, have climbed beyond the reach of the average family on Kauai.

“‘Affordable’ does not reflect the median price range of $699,000,” Estrella said. “I don’t know many locals who can afford that.”

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Caleb Loehrer, staff writer, can be reached at 245-0441 or cloehrer@thegardenisland.com.

5 Comments
  1. Charlie Chimknee January 14, 2019 7:33 am Reply

    Aloha Kakou,

    Not being a Real Tor, but a medium price $700,000.00 house price means a 20% Down Payment of $140,000.00; then a Mortgage to pay of $540,000.00 and a monthly payment of about $3,000.00 a month, plus property tax of at least a few thousand a year, plus insurance and utilities, plus maintenance of at least mowing the lawn or managing a goat…plus continual termites, dry rot, and rust repairs, unless you gonna live next to the RoundUp Glyphosate Chlorpyrifos seed plantations of Kekaha. And you got a medium home…no pool, but neighbors 10’ away.

    Or you can wait on the list of 5,000 local people at the Kaua’i Housing Agency, or some such name, and be chosen for the one $500,000.00 + home a year to be chosen to own.

    Me thinks it is time for semi-tiny homes 750 sq. Ft., to be built close to a bus stop in Tract housing fashion with all infrastructure installed, and construction involving personal sweat equity where possible, as in labor or other contribution by self, friends, and family, or volley ball players at the KCCC RECREATION YARD. Put these houses up on concrete columns and later fill in as another floor of lIving space.

    Otherwise bring on the Bathed and Priveleged , mostly retired, mainlanders looking to get the heck out of the hellacious places they have lived for too long in the freezing cold of winter and the sweltering heat of summer in the cities of the US, Canadian, European, Asian, African, Latin American, Australian, and…Honolulu. Welcome to Paradise, please take a Number, which you can now use to also register the 2 cars you’ll be bringing and your pick-up truck, boat and trailer, along with your Harley.

    There are still a few places left, take a number for that too.

    Charlie


  2. Craig Callaway January 14, 2019 9:38 am Reply

    “Locals can’t afford it.” This sounds Exactly like several stories I’ve read lately about other cities: Seattle, Portland, SFO, San Jose … you name it. Once a place is discovered and desirable, the rush is on. It’s ever been thus.

    I don’t pretend to have an answer other than local governments saying “No More!” … which then in the long run makes the place turn inward and become less desirable … until someone in power “discovers” it again … and ’round and ’round we go.


    1. RG DeSoto January 14, 2019 2:16 pm Reply

      “I don’t pretend to have an answer other than local governments saying “No More!” … which then in the long run makes the place turn inward and become less desirable …”

      Only problem is that this is exactly what has been happening for several decades. The county and state governments are saying no more by using restrictive rules, regulations, density and zoning. You see the result: a superficially imposed shortage in the face of growing demand and rising prices. Exactly the opposite of what is needed: increased supply which will help drive down the cost of land and housing.

      RG DeSoto


      1. Craig Callaway January 15, 2019 6:49 am Reply

        Do you agree with Charlie Chimknee: tiny homes / high-density neighborhoods?


  3. Peter January 26, 2019 9:33 am Reply

    What would happen if a law passed prohibiting vacation rentals like they now have in some mainland cities?

    No doubt some VR owners would let their homes sit empty or use them more often but many others would either sell or rent them out at reduced rates to locals. At the same time allow more hotel developments for tourists to stay in. Keep the tourists out of houses and put them back in hotel rooms. Problem solved.


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