Kona Real Estate Market Update - March 2012
I just reviewed the Kona real estate market data as of March 2012 and it looks very similar to last year at this point. The North Kona District saw 56 single family homes sold in the first three months of 2012 compared to 58 homes sold during the same period in 2011. Land sales are also looking very similar to last year with 8 transactions year to date compared to 7 in 2011. There has been a slight slow down in condo sales with 44 units sold so far in 2012 compared to 50 a year ago.
The median sales price of homes sold in Kona during the first three months of 2012 is almost unchanged compared to 2011, down just 2.52%. Condo prices are are down 11.1%. I believe that we are seeing signs of the Kona real estate market stabilizing. Although, the statistics do not show prices increasing, I have seen some slightly upward pressure on prices in the most popular, mid priced neighborhoods ($320,000 - $425,000). Homes that are priced where recent comparables sold are moving fast in many cases. Home sales in the higher price ranges are still sluggish.
Financing is still difficult to obtain for most buyers, especially those that are self employed. I believe that there is good demand for real estate in Kona, especially at the current prices. The missing piece of the puzzle in my opinion is widely available financing. I have seen buyers willing to put substantial money down to purchase, often 50% of the price and are still unable to obtain financing. In past real estate corrections, the first buyers willing to step in and assume some risk are the investors. This really isn't happening now because of the current state of lending.
I believe that a wider range of financing options will be available in the not too distant future. Right now, lenders are waiting for a clear sign that prices are on an upswing. However, upward pricing pressure comes from more buyers. When such a large segment of the buying population cannot get a loan, prices do not increase. At some point, the cycle will begin to move again and both sales activity and prices will begin to pick up. At the present time, the Kona real estate market is just moving along sideways with well priced properties and only strong competition for the most desirable lower and mid priced properties.
If you would like more information about the Kona real estate market, contact Rich Bosselmann at (808) 345-5085, or Konaconnection@gmail.com.
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