Kaua‘i home prices highest in state

  • Laurel Smith / The Garden Island

    One of several real-estate signs lines the Kalihiwai Ridge neighborhood filled primarily with luxury homes. A high volume of sales of luxury homes is one factor in what is driving Kaua’i’s median home prices to be the highest in the state.

LIHU‘E — Kaua‘i’s annual median single-family home price increased by over 35% in 2021 from the year prior to hit $1.1 million, the highest in the state, according to data from Hawai‘i independent real-estate firm Locations.

With low inventory on affordable homes, the luxury-housing market is driving median home-sale prices. Of the 742 houses sold last year, 54% sold for over $1 million, compared to 2020, when just 36% of homes sold were over $1 million.

Inventory on single-family homes under $850,000 remains low in the start of 2022, with just 14 active listings on Kaua‘i, according to the Multiple Listing Service on Jan. 12. There were even-fewer residential condos in that price range, with just four listings.

Interest rates are rising.

As of Jan. 6, interest rates for 30-year-fixed mortgages were at 3.22%, their highest since May of 2020, according to a survey by Freddie Mac. Higher interest rates typically lead to a decrease in housing prices, but Locations Lead Real Estate Analyst John Jacobson does not expect that to be the case this year.

“The rise of interest rates can shrink the buyer pool somewhat, but there’s still so much demand (in Hawai‘i),” said Jacobson. “There’s a large percentage of buyers that are using assets other than a mortgage to buy, so the change in interest rates affects prices negligibly.”

With low inventory, more buyers have increasingly been offering over asking prices, with the rate reaching an all-time high of 20% in 2021. Before 2018 less than 10% of buyers offered over asking price.

This year could be even more challenging than last for home-buyers.

“I think that it’s going to be as or more competitive a market in 2022,” Jacobson said. “The aspects of demand are stronger than they were. And there’s no great increasing supply.”

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Laurel Smith, staff writer and photographer, can be reached at 245-0424 or lsmith@thegardenisland.com.

5 Comments
  1. Wow January 13, 2022 6:37 am Reply

    This is laughable. In the last 10 years Kauai looks like a completely different place. The people just now moving here are moving to an island full of homeless camps, uncut grass along the roads, etc. I don’t ever remember it looking the way it does now under the previous administration. It used to somewhat resemble paradise but it resembles more of a third world country now. There are too many cars on these two lane roads. If I owned a house now would be the time to sell it and get out of here because there isn’t much of Hawaii left on Kauai. Back in the day it was the most like old Hawaii but those days are long gone


  2. peter January 13, 2022 8:10 am Reply

    So almost every resident who bought their house more than 30 years ago when the median home sales price was 350,000 or less, and and still owns it is now a millionaire. Brilliant !


  3. Yep welp January 13, 2022 8:50 pm Reply

    That not exactly something to be proud of. So overpriced that anything decent is going to straight cash sales or bidding wars. Good luck finding any local family that can even come up with the money to put down to get the loan. It’s ridiculous


  4. andy January 13, 2022 10:20 pm Reply

    This used to be such a nice island.


  5. shelly January 14, 2022 8:16 am Reply

    There are so many barriers to ADU/ARU here on Kauai…. Please allow ADU/ARU on AG zoned land if active farming is also occurring…


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