Hawaii Life Real Estate Brokers » Kolea

Kohala Coast Resort Deals (Four-Bedrooms or More)

Beth Thoma Robinson, R(B) — Sun, 15 Jan 2012 01:00:52 +0000

Increasingly in the luxury end of the Kohala Coast Resort real estate market, we find among our buyers close-knit families who often travel with at least three generations, or both sets of grandparents, or several adult siblings. For these buyers, a three-bedroom condo or home is a bare minimum; lately we’ve had some clients for whom three-bedrooms is not enough. If you are looking for a Big Island resort property with four bedrooms or more, there are only a handful of deals among the condos and homes for sale.

This entry level 4-bed home at Kukio (MLS# 249867) is listed for $4,490,000

What Does it Cost to Buy a 4-Bedroom Home at the Big Island Luxury Resorts?

“Deal” is always relative in Hawaii resort real estate! So, let’s establish a baseline. For the most part, whether at Hualalai, Mauna Kea, Mauna Lani, or Waikoloa Beach Resort, attached condos have three bedrooms at most. That means for four bedrooms you are mostly looking at a single family detached home with its own swimming pool, even if classified as a condo. That also means, for the most part, a price tag that jumps a step above the condo level.

For example, you have many choices in 3-bedroom condos at Hualalai Resort in the $2.5 million range and some older condos creeping below $2 million. A 4-bedroom home at Hualalai will cost $4+ million.

Similarly, at Mauna Kea Resort, you can buy a 3-bedroom Wai’ula’ula condo under $900,000; the least expensive 4-bedroom property for sale at Mauna Kea would be the Kauna’oa paired town homes at $2 million and up.

At Mauna Lani Resort, a 3-bedroom condo might sell for as little as $600,000 fully furnished at Fairway Villas or Golf Villas; the 4-bedroom Champion Ridge home that sold in 2011 went for $2.9 million, although there are homes listed in the Champion Ridge for well less.

Current Best Buys in 4-Bedroom Hualalai Resort Property

Lowest priced 4-bed home for sale at Hualalai is this Na Hale at Kahikole (MLS# 239153) for $4,550,000

Starting from the top, I don’t see a listing that represents a “deal” for 4-bedroom real estate at Haulalai Resort, but remember that Hualalai Realty dominates the real estate listings and they have every incentive to keep asking prices high. The trick is for the buyer to work with an agent who knows the comps and is willing to be aggressive with offers.

For example, there were two “deals” in 2011: the sellers of a Kai Molino Estates home listed at $3,150,000 accepted $1,999,900! This is an older property (1997 vintage); in newer homes, the “deal” tag goes to a sale at Hainoa Estates. Last year’s deal was a home listed for $4,950,000 that sold for $3,500,000.

The least expensive 4-bed homes currently listed are in Na Hale at Kahikole, priced right around $4.5 million. A similar home sold in 2011 for an even $4 million. These are 3-bedroom villas with a separate 4th bedroom guest suite. At Hainoa Estates, list prices are currently a bit higher than at Kahikole. The question is whether either of the current sellers, listed for $4,695,000 and $4,795,000, will accept below $4 million.

Current Best Buys at Mauna Kea Resort

The 4th bedroom in this Mauna Kea Fairways North home (MLS# 245034) is a separate “ohana;” asking price $2,695,000

Last year’s screaming deal was a home at the Uplands at Mauna Kea that was a REO (bank-owned after foreclosure). It sold for $1,050,000.

This year? I’ve already blogged about the developer closeout at Kauna’oa, but not every 4-bedroom buyer will like a paired home, and with the Kauna’oa floor plans, not all buyers consider the 4th bedroom a suitable bedroom. Among the other six homes on the market at Mauna Kea, the two lowest priced (Fairways North at around $2.7 million) each have a challenge, but they’ve been on the market for years, so I’d say make them an offer.

Four Bedrooms at Mauna Lani Resort

Second floor is a second master suite in this 4-bed Ka Milo floor plan (MLS# 246447) for $1,095,000

There IS a 4-bed condo floor plan at Ka Milo at Mauna Lani Resort. Its compact layout is well thought through to place a second master suite on a second floor directly above the ground floor master. The disadvantage for some buyers would be the lack of a private pool, but for the buyer who just needs four bedrooms and doesn’t mind the shared amenities, here is an option for only $1,095,000.

If you need your privacy and a pool, the entry level single family home community at Mauna Lani Resort is Champion Ridge. There is a home listed at $1,750,000 (MLS# 248964), almost a million less than anything else in there. Challenges: 2-story floor plan that many find odd and a lot that backs up to the road.

If your budget allows, step up to 49 Black Sand Beach, where the view or pool at any individual home is less of an issue when you can walk to the private beach club amenities. The lowest priced 4-bed home for sale at 49 Black Sand has been reduced to $2,995,000 (MLS# 226747)…and having been on the market almost 2.5 years, perhaps they are ready to make a deal.

Screaming Deals at Waikoloa Beach Resort

Single family home at Kolea (MLS# 226945) is now priced at $2,600,000 – less than a penthouse condo

Speaking of 2.5 years on market, look at the date stamp on the MLS photo for the house on Lot 16, Kolea at Waikoloa Beach Resort. Originally asking $4.9 million, the price is down to $2.6 million for this 5-bedroom home. Privacy is a plus; lack of ocean view a minus, but you are easy walking distance from the beach at Anaehoomalu Bay, or the restaurants and shops at the King’s Shops and Queen’s Marketplace. As recently as 2010, a 3-bedroom Kolea condo sold for $2,550,000, so for the right buyer, this is a deal.

Two Halii Kai condos connected to make a 6-bedroom unit; each master has its own lanai with ocean view…$1,030,00 each

Finally, if you want the most bang for buck defined as number of bedrooms for the price, here’s your deal: Halii Kai 8F (MLS# 249218) and 8G (MLS# 249216), two penthouse condos of 3 bedrooms each that have been combined with a door between. That gives you a total of 6 bedrooms with two master suites (each having its own lanai). The asking price for the pair is $2,060,000! Again, you won’t have a private pool, but if your family prefers to have the kids splashing in the big pool while the adults sip their mojitos at the Ocean Club bar and watch for whales, this is a situation one can truly call unique.

A hui hou,

Beth Thoma Robinson, R(B)

Are There New Kolea Foreclosures on the Way?

Beth Thoma Robinson, R(B) — Sat, 19 Nov 2011 02:15:50 +0000

Shortly after writing that both REO (foreclosure) homes at beachfront Kolea were in escrow, I had a conversation with an agent looking for an oceanfront foreclosure situation at Hali’i Kai, the other luxury condo complex at Waikoloa Beach Resort.

Her buyers were hungry for oceanfront and she was insisting she had on good authority that there were new REOs coming on in Buildings 13 and 15…which are two of the three oceanfront buildings at Hali’i Kai. Since Pam Deery and I dominate in Hali’i Kai oceanfront listings and sales, we have a good sense of the inventory, and I could not think of a single oceanfront owner in distress.

It wasn’t until our second conversation that the light bulb went off in my head. The new REOs will not be at Hali’i Kai; I’ve been waiting and watching for a very long time for two bank-owned Kolea properties to finally appear on the market…and they happen to be in Kolea buildings 13 and 15!

Kolea owners have a small amenity area with a private path to the beach

I won’t tell you exactly which units they are, but here’s the scoop:

Remember, there are two sets of buildings at Kolea. The front row are six-plex, which means larger, 3-bedroom villas with all of them being outside units and all having garages. Behind those are twelve-plex buildings, mostly 2-bedroom floor plans and carports rather than garages.

The upcoming REO in Kolea Building 15 is an example of an inside, two-bedroom, 1,270 sq. ft. plus lanai. Recent sales of that floor plan have been mostly REO and short sale. The lowest sale of a comparable floor plan in 2010 bottomed out at $367,500; this year, a ground floor, inside, 2-bedroom sold once as a short sale for $425,000 and was resold two months later for $479,000 (remember my blog post on flipping?).

The large 3-bedroom Kolea villas have pocket doors for indoor-outdoor living like short sale 10E (MLS# 241405)

The upcoming REO in Kolea Building 13 completed foreclosure and became bank-owned at the beginning of this year. It is an example of the largest of the Kolea floor plans at 2,147 sq. ft. plus lanai. Again, trying to predict where the selling bank will choose to list it leaves me with the sense I’m walking into a casino.

A second-floor, non-distress sale, vacant, and never occupied unit sold for $1,425,000 in August of this year. The same floor plan is offered as a short sale in Building 8 for $1,299,000 with no offers…and over in Building 3 is a short sale at $899,000.

If you are serious about taking a shot at one of these two Kolea foreclosure opportunities, here’s what you need to do:

Choose an agent to be your buyer’s representative. You want someone to call you the moment it hits the MLS. I recommend signing a Buyers Representation Agreement if you really want to be their first call!
Get pre-qualified if you will be financing; have your proof-of-funds ready to send if you will be an all-cash buyer.
Ask your agent to discuss the comps with you, so you know what your top price will be. In recent REO and short sale releases, we’ve seen bidding wars; you may or may not be given the opportunity to resubmit a “highest and best offer” if there are multiple offers on the table.
REOs are sold “As Is.” These have been vacant for a while, so figure into your budget some deferred maintenance as well as furnishings.
Banks like to see clean offers. An agent who has sold at Kolea previously should be able to provide you with condo docs, so you can study them in advance. An agent who has helped clients with REOs will walk you through how to write an offer that has a chance of easy acceptance.

Good luck!

A hui hou,
Beth Thoma Robinson, R(B)
Direct: 808.443.4588
Email: Beth@HawaiiLife.com

Waikoloa Beach Resort Condo Sales Statistics (Oct. 2011)

Catherine Klug, RS — Fri, 11 Nov 2011 21:15:49 +0000

If you have read my blog about the September sales update, you already know that the community of Hali’i Kai is getting the most attention from buyers. The month of October (2011) ended with only 2 condo sales at Waikoloa Beach Resort and both were at Hali’i Kai, the ideal place to enjoy the Waikoloa lifestyle.

Hali’i Kai Ocean Club perched on the ocean’s edge

The Halii Kai developer, Centex Homes, was able to cross 2 more units off their sales list last month. A 2 bed/2 bath “Ho’oulu” model in the Coconut Grove was swiped at $399,000 and listed at $475,000. A “Mahana” model, a smaller 2-bedroom floor plan with golf and ocean views, sold at $475,000 with an asking price of $545,000. Both properties were purchased with a conventional loan; many buyers are currently choosing to finance because of the low rates. Hali’i Kai is classified as a resort condo, which means at least 30% down was required.

The Waikoloa Beach Resort may welcome 17 new homeowners in the months to come since 17 condos are in escrow at the moment. The 2 developer units that just sold looked like an easy ride for buyers: quick response from the developer, brand-new units, great prices, one to two years break on the HOA dues, and one year or more fit and finish warranty as well as a 10 year structural warranty included.

Transactions may not be as smooth for the six Halii Kai buyers that have chosen the short sale road. We count six transactions at Kolea, four of them are short sales. One buyer grabbed the last developer unit at Waikoloa Beach Villas and four others signed up for distressed properties at Waikoloa Colony Villas, Fairway Villas, and Vista Waikoloa. No doubt that with 12 units in escrow, Hali’i Kai and Kolea are leading the way!

Kolea Beach Club pavilion overlooking Anaeho’omalu Bay

Resort amenities among gated communities are the big draw on the Kohala Coast as buyers are particularly interested in top-of-the-line extras, such as Hali’i Kai Ocean Club or Kolea Beach Club, when they purchase a Hawaii property. With 86 condos currently for sale, what would draw you to a Waikoloa Beach Resort condo?

Kohala Oceanfront Foreclosures Update

Beth Thoma Robinson, R(B) — Tue, 08 Nov 2011 02:15:13 +0000

Regular readers of my blog posts may wonder whatever happened to that bank-owned Hawi oceanfront mansion, or the foreclosed beachfront homes in Kolea on the Kohala Coast I wrote about in a post two months ago?

Asking price is $6,500,000 for this Kolea home (MLS# 241295)…but may not be the best value

As of last week, the two REO homes at Kolea—the one on lot 13 offered for $3,695,000 and the one on lot 4 next to the Beach Club offered for $3,400,000—are both in escrow. That leaves the house on lot 16 offered for $3,750,000 and the one on lot 5 for $6,500,000.

The lot 5 house sold in 2006 for $6,600,000 to the current owners, who apparently don’t get that even setting aside distress sales, the house that sold in 2009 for $6,500,000 had 5,733 sq. ft. and 5 bedrooms versus 3,677 sq. ft. and 3 bedrooms; pricing seems to be more than $2 million off…wonder if they will look at offers?

Whale-watching lanai at Hawi oceanfront foreclosure (MLS# 244454) now down to $3,850,000

If just under $4 million is your target price point for your oceanfront home, you still have a shot at the 13,000+ sq. ft. home on 20 acres near Hawi. It recently had a small price reduction to $3,850,000, so the price keeps inching down. I predict the eventual buyer will walk onto the lanai just as a whale is breaching a few hundred yards away. With 7 months on market, the bank is wanting a quick close. Maybe try an aggressive offer with a 3-week close?

New on the market, two bank-owned oceanfront lots at Naupaka Pl: (MLS# 248560) and (MLS# 248561)

The new oceanfront foreclosure opportunity comes as twins: Lot 7 and Lot 8 at Naupaka Place next to Kolea were purchased by the same buyer. The bank now owns them after foreclosure and has just listed them for $2,550,000 each. Full disclosure: I am the listing agent for these lots, as well as adjacent Lot 9 (MLS# 233826).

What should lots at Naupaka Pl. be worth, given the price of homes selling at Kolea? It’s hard to make a direct comparison because there is a location premium at Naupaka. Look at the steps to the beach from Lot 7/8 Naupaka Place compared with the distance to the ocean from the Kolea home above. Plus, behind the gates of Kolea you find both single family homes and 16 condo buildings; behind the gates of Naupaka Place are only 11 lots. The one home that was built and sold in Naupaka is around 5,000 sq. ft. with 4 bedrooms. It changed hands twice for $10,500,000 at the market peak in 2007 and for $9,500,000 in 2009.

For more information about these or other oceanfront and beachfront properties for sale on the Kohala Coast, feel free to call or email me directly!

A hui hou,
Beth

Beth Thoma Robinson, R(B)
Direct: 808.443.4588
Email: beth@hawaiilife.com

Oceanfront Foreclosures on the Big Island

Beth Thoma Robinson, R(B) — Sat, 10 Sep 2011 01:50:03 +0000

I am suddenly getting a lot of inquiries on two oceanfront properties that are “REOs”—real estate owned by the bank after foreclosure. I’ve blogged about both of these oceanfront homes before, but right now I’m getting the same questions over and over, probably because buyers are starting to get serious about the details.

Both of these foreclosure listings have had recent price reductions and my guess is the banks are ready to take a reasonable offer. When banks list REOs at lower price points, they are usually disciplined about regular price reductions to sell in a short period of time. With listings in this $3—$5 million range, they tend to think in terms of a longer listing horizon, hoping to get a sale within 6 months or a year. Both of these oceanfront properties are at that stage.

The MLS photos don’t show the red granite exterior of this Hawi oceanfront estate home (MLS# 244454)

Don’t expect the listing agent on a bank-owned property to spring for professional photos or virtual tours. In the case of the 13,000 sq. ft. six-bedroom oceanfront estate home on 21.5 acres for sale in Hawi, my most frequently asked question is, “What does the exterior look like?” Since inexplicably, that’s what’s missing from the MLS photos.

The listing was released in April for $4,999,995 and is now down to $4,050,000. One might ask whether or not this is a best buy price? If you have checked out the new version of the Hawaii Life website, you’ll notice that we’re trying to rate listings, and this oceanfront foreclosure gets a value score of 92.

I don’t know what the official algorithm is, but here’s my perspective. The oceanfront lot adjacent to this home, which is not nearly as desirable as the acreage this mansion occupies, sold for $1,050,000 in 2009. Subtracting that out gives me a $3 million price tag for the oceanfront home. That works out to something like $230/sq. ft…which is about what it costs to build in Hawi using a kit home from one of the lumber yards!

The other listing I’m getting calls to show is one of the oceanfront homes at Kolea that I’ve blogged about in the past as my favorite.

This beachfront foreclosure at Kolea (MLS# 241676) has been staged with furnishings appropriate to its location and quality of finish

Now, forget what I said about banks and their agents not presenting their luxury foreclosure properties in the best light. When it comes to this oceanfront Kolea resort foreclosure, the property has been beautifully staged, but the MLS photos don’t capture everything…like the waterfalls in the entry, the privacy of the separate guest suite, or how the home is sited to give residents the feeling of being all alone at the beach.

I was told when the price was above $4 million not to bother writing offers that began with a “3.” Now the price has inched down to $3,695,000 after the most recent reduction. The psychology among the prospective buyers to whom I’ve shown the property seems to be to continue to wait to see just how low it will drop. Inevitably, someone will pull the trigger and the other buyers will be regretting the one that got away.

Our website is currently only rating this one at an “88,” but the devil is in the details. The Kolea home that went to auction in March and sold as a short sale for $3,850,000 was 4,169 sq. ft. compared with 4,784 sq. ft. for the REO property. Both lots have a buffer of lava conservation zone between them and the ocean, which also ends up being a buffer between your home and the sunbathers and Ironmen enjoying the beach. Only the foreclosure for sale has more privacy than the one that sold, and a great deal more privacy than the only house listed for less at Kolea, which is right next to the Beach Club.

By the way, the question I get asked about this oceanfront property is whether the furniture is included. Technically, no. You want to make the deal even sweeter? Throw it into the offer! What’s the bank going to do, put it in a warehouse waiting to stage their next Kohala Coast beachfront foreclosure?

A hui hou,
Beth

Beth Thoma Robinson, R(B), SFR
Email: Beth@HawaiiLife.com
Direct: 808.443.4588

Beachfront Kolea Market Update – July, 2011 (Big Island)

Beth Thoma Robinson, R(B) — Thu, 28 Jul 2011 00:15:09 +0000

The high-profile auction of a beachfront home and a penthouse condo at Kolea on the Big Island in March left market watchers feeling a little like they had just watched the final episode of this season’s hot Hawaii-filmed television series. In a cliff-hanger finish, the condo was withdrawn from the market and the home went into a long escrow with the coconut wireless chattering that the highest bid required the seller’s lender approve it as a short sale.

The new season of Kolea homes for sale has begun: the oceanfront residence on Kolea Lot 7 closed last week for $3,850,000 (that does not include the fee paid to the auction house and any cash contribution required of the seller for lender approval was also not disclosed).

I still believe the distressed properties at Kolea, whether homes or condos, represent “best buys” in an increasingly tight Kohala Coast resort market, given their unique beachfront location. The single family homes at Kolea that are bank-owned after foreclosure will now sell based upon this most recent comp, which is well below the 2009 market sale of the home on Lot 10 for $6,500,000.

Best Buy—bank-owned oceanfront home at Kolea on the Big Island’s Kohala Coast (MLS# 241676)

Here’s the line up:

Nearest to the Beach Club, the home on Lot 4 is listed for only $3.4 million (MLS# 242410). Walk through your own gate to the private path to the white sand beach at Anaehoomalu Bay. The downside for some buyers would be the same as its attraction for others…nearest the Beach Club amenities.
The Kolea home for sale farthest from the Beach Club, on Lot 16 (MLS# 226945), offers the most privacy and the least view, and is offered at $3,750,000. This is a smaller home, so at that price, probably not the best buy among the options.
My favorite, however, has the best of both worlds. The REO (foreclosure) on Lot 13 (MLS# 241676) has a killer location with plenty of privacy and is still an easy walk to the beach. Because this is a corner lot, the floor plan this same architect used on Lot 4 was tweaked, and the result is a much more interesting and lifestyle-friendly layout with two guest suites flanking the pool on the opposite side of the main house. Priced at $3,950,000 furnished, the bank has turned down a number of lower offers, but with a new hard comp, the next reasonable offer should be a winner.

If your preference is for a 2,000 sq. ft. Kolea condo with pocket doors opening to a huge lanai to enjoy the ocean views, there are two short sale offerings of this floor plan. Both are second floor, and as short sales, these prices are subject to lender approval.

Kolea 3E has the bonus for an investor of a series of excellent rentals in place through 2012 and is now reduced to an asking price of only $945,000 (MLS# 239266).
Kolea 10E (MLS# 241405) is asking $1,375,000, which is exactly what the mirror-image unit sold for as a short sale.
If you don’t want the uncertainty of a short sale and do want the convenience of a furnished, ready-to-go vacation home, you’ll have to pay up. Kolea 6E (MLS# 236030) is asking $1,795,000.

There are a total of 5 homes and 15 condo villas listed for sale at Kolea. Check out my galleries on the Hawaii Life website: Kolea Homes for Sale and Kolea Condos for Sale.

Here are more great articles on Kolea real estate:

Kohala Coast Resort Condo Communities Sales Activity – The Flipping Begins

Beth Thoma Robinson, R(B) — Sat, 02 Jul 2011 05:45:49 +0000

My team and I have spreadsheets (both written and mental!) for the Kohala Coast Resort condo communities, so we can track listings and sales activity. That way, we know at a glance whether a new listing is a deal or overpriced. We can see whether the price on resort properties for sale is trending upward or downward, and what the differential is between distress sales (short sales and REO ”foreclosures”) and market sales.

There have been a few surprises lately, or perhaps I should not have been surprised, as a number of us have been blogging about the diminishing inventory, which Economics 101 tells us, given a steady level of demand, should lead to higher prices. Hence the other “f” word (no, not foreclosures)—”Flipping”—has re-entered our real estate vocabulary.

Here is a section of my spreadsheet for the Kolea condos showing the 2 bedroom units. I have it arranged as the condos stack up in the building, which also allows me to see at a glance whether there is a premium for the higher floors. The code “ss” stands for short sale…so you can see that, since 2009, these have all been short sales, and that if anything, prices on this year’s closings were down a bit. Then, that surprise! Kolea 11D closed as a short sale on May 16th; on May 19th, it was back on the market, with a price jump over $100,000. On June 12th, it was back in escrow.

1,270 sq. ft.

SOLD:

9F $460,000 ss 9/16/09

11F $459,900 ss 7/1/10

16E $399,000 ss-offer

11D $539,000 in escrow

SOLD:

15D $450,000 ss 8/6/10

9D $421,000 ss 2/22/11

11D $425,000 ss 5/16/11

Wow! That $539,000 condo doesn’t look like such a great deal…except that there are only two other Kolea condos for sale of this floor plan at the moment, priced at $798,000 (MLS# 233827) and $830,000 (MLS# 241720). Granted, the two are turnkey furnished with one having a super rental track record and the other never having been rented (which makes them appeal to different buyers), but a $100,000 jump is easier to swallow than at $400,000 jump.

Kolea 16J is the lowest priced turnkey 2-bedroom for sale at $798,000

By the way, a short sale approval letter does restrict buyers from selling immediately, but that is often defined as 30 days from closing. I personally would probably be conservative and not list during the first 30 days, but this is a pretty easy restriction to live with, even for an investor who plans to sell as soon as feasible.

Not every owner who decides to sell a Kohala Coast property they bought as a short sale or foreclosure is flipping. The other scenario goes like this: Buying a second home in Hawaii is a big deal at a time when the news and views about real estate markets can be contradictory. Often, buyers will begin with a purchase that feels comfortable to them. Once they spend time here, realize how much they love the lifestyle, and have a better sense of the local market and relative values, they are ready to trade up.

That is the case with another of my favorite listings, Wai’ula’ula at Mauna Kea #N201 (MLS# 245853). Purchased by the current owners in 2009 for $950,000, they have it on the market furnished for $875,000. Reason for selling? They got a great deal on a single family home, a foreclosure also in the Uplands at Mauna Kea.

No buildings obstruct the ocean view from Wai’ula’la N201

Sellers who bought at the peak are facing a larger hit selling at today’s prices than sellers who bought in 2009 or later, so perhaps it is not so surprising that they would be the first to sell as prices creep up.

Other units where the seller purchased only recently include two condos at Mauna Lani Resort. Kulalani 406 (MLS# 244145), offered for $599,000, is the only active listing in this Mauna Lani condo community! There is a condo with the same floor plan working through the short sale process at a listing price of $405,000, but as in the Kolea example above, a Kulalani buyer has only one choice.

Ka Milo 125 (MLS# 246268), asking price $1.1 million, is the only active resale with the other Ka Milo at Mauna Lani listings all being developer pre-construction units. It closed as a short sale June 7th…for $700,000. Those must be awfully nice furnishings!

Ka Milo home closed as a short sale for $700,000; now offered furnished for $1,100,000

Whatever the background story may be, whether the seller is making money, or losing money on their real estate, the right way to look at the listing is strictly with respect to alternative condos or homes for sale, and the prices on recent sales.

What the seller paid…or what the overworked Hawaii county assessor has it valued at for tax purposes…is irrelevant. It’s today’s willing buyer and willing seller who decide what the right value for that Kohala Coast resort property actually is.

Kolea Best Buy Alert – Home and Condo Price Reductions

Beth Thoma Robinson, R(B) — Thu, 05 May 2011 01:12:54 +0000

Prospective buyers who missed out on the beachfront Kolea luxury home and penthouse condo auction in March are in luck as BIG price reductions have created two new best buys in the past two days:

a bank-owned single family home was reduced from $4,900,000 to $3,995,000 (making two Kolea homes listed under $4 million!)
a front-row Kolea condo had been withdrawn from the market at $1,995,000 and returns reduced to $1,375,000 as a short sale

Starting with the condo Kolea 10E (MLS# 241405), this is a 2nd floor villa of the largest, 2,147 sq. ft. floor plan and is directly across from the Kolea Beach Club with its infinity pool and private path to the beach.

This luxury condo is now listed at the same price the facing unit sold for as a short sale in February 2010. Another point of reference, the villa directly above was the foreclosure that inspired a bidding war in March. It just closed at $1,569,000.

Beachfront Kolea includes single family residences and luxury condos; all owners are welcome at the Beach Club

The Kolea home on Lot 13 (MLS# 241676) is one of two bank-owned (REO) single family residences with private pools fronting the ocean. The lot it sits on was purchased for $3,295,000. The home is 4,784 sq. ft. with a separate guest wing separated from the main house by a pool.

At an asking price of $3,950,000, it is highly likely that one of the previously rejected offers will suddenly be resurrected and walk off with the prize!

Kolea vs. Hualalai – Why the Auction Results Were Different

Beth Thoma Robinson, R(B) — Tue, 05 Apr 2011 23:00:40 +0000

Two weeks have passed since the Concierge Auction sale of an oceanfront home at Kolea and a penthouse Kolea villa. As I reported in my earlier post about the auction results, the home immediately was noted as “contingent” in the MLS with a $4 million price reduction.

Although I was assured the condo is indeed being sold with no minimum as advertised, the MLS still shows it as active.Â Last night, I ran into the rental manager for the home who said it continues to be shown to prospects. That is not surprising because at the price obtained at auction it would be subject to lender approval as a short sale. In other words, it may be some time before we know the end result of either auction.

As I commented in my earlier post, I have some thoughts on why Concierge Auction was apparently much more successful at selling Hualalai and Kukio properties than in the Kolea sales.

The Kolea Beach Club pool area is modest because most owners prefer to walk a few steps farther to the beach…

Waikoloa Beach Resort versus Hualalai Resort

If only we’d had a “Cher” to advertise as a Kolea owner! Back in the days when I was selling Kolea for the developer, we were in competition with similarly priced new luxury projects at Mauna Lani and Mauna Kea. Given Kolea’s beachfront location, we would sell against them by saying that the newer condos at Mauna Lani (Villages or Ka Milo) had no ocean views, and were far from the beach; the newer condos and homes at Mauna Kea (Wai’ula’ula and Kumulani) were the far mauka side of the highway. In turn, their sales agents sniffed that Waikoloa Beach Resort was “downscale” and “Disneyland.”

The real question for buyers in deciding which resort fits them is neither views nor distance from the beach, but lifestyle. Each of these resorts offers a slightly different package of amenities. Waikoloa Beach Resort is the most “a la carte,” having no amenities program for property owners tied in with the resorts, hotels, and golf courses. Mauna Lani Resort owners are invited to their (no-cost) Advantage Program and have access to the Beach Club amenities as well as charging privileges and discounts at the Resort.

Mauna Kea Resort owners have a choice of three levels of membership, with fees ranging from $5,100 to $16,850/year on top of homeowners association dues. Most Mauna Kea property owners purchase at least the social level which allows them to use the chairs and towels at the Mauna Kea and Hapuna Prince hotels’ famous beaches.

The auction publicity brought many prospective buyers to take a fresh look at Waikoloa Beach Resort. I’m working with several who chose not to participate in the auction, but confess to liking the energy of the resort and the fact that they can not only walk to the beach via Kolea’s private path, they can walk to restaurants, shopping, and the amenities of two hotels.

Owners of property at the Hualalai Resort, or Kukio are looking for an entirely different level of private amenities…and prepared to pay for them. Which brings me to…

Cost Structure of the Auction and Resort Property Ownership

The fine print in the Kolea auction brochure explained a fairly complicated structure of credits for a winning bidder who had placed an opening bid prior to the start of the auction at pre-determined levels, and a buyer’s premium of 10% of the winning bid paid to the Auction House at the close of the deal.

During the auction, bidders on both the house and the condo called for “time out” and it was clear that was because bidders had in mind a total price they were willing to pay, and needed to calculate what their bid could be to keep their total purchase price at or below that number.

For the Kolea condo, the minimum buyers premium of $175,000 was a significant amount in the minds of bidders. For the oceanfront residence, the questions I heard before the auction related to the seemingly high costs of ownership and maintenance.

In contrast, the buyer of any of the condos listed in the $2.5 million range at Hualalai Resort communities will be paying a $225,000 membership “deposit” and over $30,000 per year for the Amenity Program on top of homeowners association dues similar to the $2,000/month for a Kolea penthouse villa. The buyer at Hualalai or Kukio (with its even more expensive and exclusive amenity program) is by definition someone prepared to pay these amounts regardless of purchase price.

Purchase Price: Distressed Property Sales at Kolea

Hindsight is 20:20 and perhaps Concierge Auctions had no experience conducting sales in neighborhoods where the “comps” for the properties being auctioned included short sales and REO (foreclosures).

When prospective buyers walked into the oceanfront Kolea home and their eye immediately traveled through the house to the spectacular view, the auction house representative would walk them straight to the poolside lanai, open his arms wide to take in the view and exclaim, “THIS is what you are buying. It happens to come with a home attached,” and if that was true, why would a buyer spend more than the $4 million cost of the bank-owned house a few lots away?

Similarly, with a REO of the identical Kolea penthouse floorplan with a closer walk to the beach, being listed at only $1,390,000 only days before the auction of Kolea 2C, just how much more would a savvy investor pay at auction? It would be as if the Hualalai auction had been of a Hainoa Villa during the period when a foreclosure was listed for $995,000, and a short sale (still available!) at $1,295,000…but the villa being auctioned was listed at a $1 million premium.

The bottom line is whether the right lifestyle for you is to be found at Kolea or Hualalai, or at Ka Milo or Kauna’oa for that matter, there are values to be found. The bidders at the auction fell out early because they wanted to snatch something below even foreclosure prices. The happy new owners I have enjoying their Kohala Coast resort lifestyle today are the ones who realize the game is not to always get something below the last asking price, but to get something that will be a steal compared to next year’s asking price.

Kolea Real Estate Auction Results

Beth Thoma Robinson, R(B) — Thu, 24 Mar 2011 02:15:48 +0000

Monday’s auction of an oceanfront home and a penthouse villa at Waikoloa Beach Resort was almost overshadowed by other sales activity at the Kolea beachfront gated community. Although I can’t reveal the prices at which the two properties sold, I can say that the auction left attendees shaking their heads and muttering, “somebody just got a screaming deal”…although perhaps more so for the home than for the condo.

As an indication, when the listing for the oceanfront home went from “active” to “contingent” yesterday, the price was reduced from $8,995,000 to $4,900,000. The fine print in the auction brochure suggests that, at this point, the auction is not a firm sale that will close in 30 days, but a short sale subject to lender approval. If approved, it would be the first successful short sale of a single family residence at Kolea. (There are two neighboring houses that actually went to foreclosure.)

Although this Kolea oceanfront home was auctioned, 5 Kolea homes are listed at competitive prices

At close of official registration last Friday, the Concierge Auction manager told me that he was “right where he wanted to be” in terms of the number of bidders registered for the house. He was silent as to the condo, so the only thing surprising about the email I received at 7:30 p.m. Sunday night to encourage last-minute registrations was the timing. It read, “Don’t Regret! Waikoloa Penthouse May Sell for 1/2 off.”

This is one of those properties that after the auction my clients will say, “If I only knew!!!” Currently listed for $2.295M. The email went on to say that “people had been assuming a high bid of $1.7 million and playing themselves out of the opportunity.” That was certainly the case with my clients who had been evaluating participation. The structure of the buyer’s premium in the bidder’s package encouraged that perception, as the premium was set at 10% of bid price, or a minimum of $175,000, whichever was cheaper. What that meant was if, for example, a buyer wanted to spend no more than last year’s comp of 2F at $1,500,000, their top bid would be $1,325,000.

But even that price began to seem steep with Kolea 10F having been released as an REO (foreclosure) during the auction registration period at $1,390,000. It appears the serious bidding was on this penthouse facing Kolea’s Beach Club. Word from the listing agent is that an offer was accepted by the bank yesterday, and that bidding had hit at least $1,600,000. A year ago, when I had a buyer making an offer on multiple penthouse units, the premium for west-ocean-facing versus beach-facing units seemed to be about half a million dollars…when both Kolea 2C and Kolea 10F close, we’ll know whether that premium held.

As I took prospective buyers to see all the available options last week, some concluded that they were indifferent between a “penthouse” which at Kolea means a 3rd floor, and a 2nd floor condo of the identical 3 bed, 3 bath 2,147 sq. ft. floor plan. Someone else’s buyer must have concluded the same thing, because on the day of the auction Kolea 12E, a vacant, unfurnished, never occupied unit offered for $1,595,000 also went into escrow. When the sale closes, it will give market watchers (and appraisers) another data point, a 2nd floor versus 3rd floor price premium, as this was also not a distress sale.

In a sense, the auctions were successful. Each of these properties had been on the market for over 3 years, and with a 30 day push they were sold. But on the other hand, the Kolea auctions do not appear to have been as successful in terms of prices realized for sellers as the Concierge Auctions at Kukio or Hualalai Resorts. I have a few ideas as to why (hindsight is always 20-20 and I’ve spent 48 hours thinking hard about this!), but that’s a long enough topic to deserve its own blog post. Watch this space!