Have you ever dreamed of “someday” living in Hawaii? More people are turning their dreams into reality right now by relocating to the Big Island of Hawaii. Affordable real estate prices, coupled with plenty of business opportunities, make relocating to Hawaii easier than you might think.

Relocating to the Big Island of Hawaii offers intense beauty and opportunity

Frequently Asked Relocation Questions

Q: Why would I want to live in Hawaii?

A: The Big Island of Hawaii offers something for everyone, regardless of lifestyle choices. While the pace of life here in Hawaii is slower than that of the Mainland, it is typically that need to live a more simple life that draws people to the islands.

The lush tropical setting, expansive ocean views of the blue Pacific, year-round warm climate, and gentle trade winds make for an idyllic backdrop to life at any stage. Combine those features with the affordability currently seen in the housing and property market today, and there you have the once-in-a-lifetime opportunity for living your Hawaii Life.

Q: What’s the cost of living in Hawaii compared to the Mainland?

A: Several factors ultimately determine what some may deem as “cheap” or “expensive.” Rather than delve into a rambling subjective diatribe on the issue, let’s look at some of the more general facts concerning the true cost of living.

Here in Kona, for example, we have Costco, Lowes, Walmart, Target, as well as other well established national chain stores. You’ll find little difference in prices between these larger “box” stores and those on the Mainland. However, local supermarkets and convenience stores will have noticeably higher prices on everyday items. As the majority of the products found in Hawaii must be literally shipped in, those fuel and carrying costs are passed along to the consumer.

The same holds true for energy costs, specifically gasoline and electricity. Hawaii’s gasoline prices typically mirror those found in the more populated areas of California, or may be a few cents more. Electricity on the other hand is the highest in the nation; not a great selling point, but it’s the truth nonetheless.

However, Hawaii is well on its way to leading the nation in renewable energy sources. Finding a home in Kona without a solar water heater is rare and we’re seeing an explosive increase in single family homes with photovoltaic conversion systems.

For a two city side-by-side cost of living comparison in all the categories you need, such as taxes, housing, food, and other costs, use the Comparison Calculator.

Q: Where is the best place to live on the Big Island of Hawaii?

A: With 10 of the world’s known climate zones existing solely within the confines of the Big Island of Hawaii, it really becomes more of a question of, “In what type of climate do you wish to live?” Due to the large number of micro-climates, changes in elevation, lava zones, and population centers, one can surround themselves in virtually whatever surroundings they so choose. There is also the added benefit of oceanfront living, which takes on a completely different feel from that of inland island living.

The Kona and Kohala Coast areas are perfect for those who enjoy a dry, arid type of environment, but have the benefit of amazing ocean and coastline views. The oceanfront resort areas of the “Kona Gold Coast” are the perfect locations for those who enjoy luxury living, coupled with palm trees and beaches.

If, on the other hand, you enjoy warm tropical rain and lush rainforest, then the Hilo and Puna District is just right. The Ka’u District to the south is defined by its lava fields on the West coast, and its steep and rough terrain on the East side nearing Volcanoes National Forest.

The inland areas of Waimea-Kamuela and the northeastern Hamakua Coast are typified by their rolling green hills and cattle ranches. Here, the nights can be cold enough for a lit fireplace and the occasional frost or hail storm.

All of the other islands in the Hawaiian chain fit into the Big Island of Hawaii, with plenty of room to spare. This diversity affords anyone the choice to live in the exact environment that fits your wants and needs.

Whether Mauka or Makai, the Big Island holds something for everyone

Relocating to the Big Island of Hawaii – Part II Preview

In “Relocating to the Big Island of Hawaii – Part II“ I’ll be answering some of the more specific questions focused on the actual logistical aspects of moving to Hawaii.

• Shipping Companies for Vehicles and Personal Belongings
• Transitioning Your Pet
• Big Island Job Market
• Buying vs. Renting

Helping people realize their dream of living in Hawaii is my passion. If you are considering relocating to the Big Island of Hawaii, or are in the market for real estate anywhere along the sunny Kona coastline, please contact me anytime for a no obligation “talk story” about why I make Kona home. Let me help you to live your best Hawaii life!

Please feel free to contact me anytime at:

Todd W. Barrett, Realtor(S), ABR
Direct: 808.937.1629
Email: Todd@HawaiiLife.com

Related posts:

1. Relocating to the Big Island of Hawaii (Part 2): Frequently Asked Questions
2. Commonly Asked Hawaii Public and Private School System Questions – Moving to Hawaii?
3. Mahalo Nui Loa to 2009, From Hawaii Life on the Big Island

A look at the 16 vacation rental foreclosure sales in the last six months sends a clear message: step up.

​If recent history is any indication, this 2-bedroom foreclosure condo at Kapalua Ridge (MLS# 351327), listed at $514,900, will sell at or near its listing price

What’s the Driving Factor Behind Getting Your Offer Picked?

If you’re a serious buyer, and are looking at buying a vacation rental foreclosure, you’ll need to make a serious offer – that’s the clear message after an analysis of the 16 Maui foreclosure condos that have closed escrow in the last six months.

Every foreclosure I’ve seen that has been priced correctly has triggered multiple offers. I have successfully represented three buyers of foreclosure deals in the last year and all of them have had multiple bidders.

Each of them have gone beyond the first round of submitting offers, to a second round of each prospective buyer submitting his “highest and best.” Negotiation and commitment at this level of the game are key – this round determines who the bank picks to buy the property.

Price is the driving factor behind getting picked, but it’s not the only one. Prospective owner-occupants may get a nod, all other factors being fairly equal. Cash is king and sometimes trumps price. If you’re stubborn about concessions, you’re out – there are ways to get them, but going in hard in your offer is not one of them.

Maui Vacation Rental Condo Foreclosure Sales Statistics

The 16 Maui vacation rental condo foreclosures since early October 2011 ranged in sale price from $69,000 to $725,000.

Thinking of lobbing a low ball? Think about this: of the 16 sales, 10 of them sold for 98% or more of listing price, and seven of the sixteen sold at full price or higher. The median sale in these 16 traded at 99% of listing price. 14 of 16 sold at 92% or higher of listing price; the bottom two sold at 84% and 85%.

This is a great time to buy a foreclosure condo on Maui, but you have to commit to it. And I strongly recommend working with an agent who has done these deals, and know how they work – and I don’t mean the listing agent!

16 Maui Vacation Rental Condo Foreclosure Sales – October 2011 to April 2012 – By Price

Related posts:

1. Deal – $225K Condo Foreclosure on the West Side of Maui
2. Private Ground Floor Condo (Foreclosure) at Maui Kamaole with Two Lanais
3. Kihei Condo Sales For March 2012

We left off on Forclosures 101 (Part 1) with you getting a lender pre-approval. In Part 1, you also learned that the majority of foreclosure properties have deferred maintenance and will require repairs. Given that, your loan options are not as wide open as with a regular property purchase.

Loan Options

• Conventional – One of the best choices for a foreclosure purchase. It requires a larger down payment, but is probably the easiest of the loans one can get. A solid down payment and good credit will take you far!
• USDA – This loan requires no down payment, but you will have to ante up closing costs. While you will make an earnest money deposit with your offer, that will customarily be credited back to your closing costs at the close of escrow. Note: The funds for these loans are released incrementally throughout the year, so USDA loans are not always available. Unfortunately, USDA almost always takes at least 60 days to close, so not all REO sellers look at these favorably. Sellers want to divest themselves of their properties quickly and get them off the books. Still a good choice for the buyer with not much deposit money.
• Fannie Mae HomePath – Strongly recommended for purchasing Fannie Mae properties. In some cases, only requires as little as 3% down. The percentage rate may be a point or two higher, but this loan requires no appraisal or mortgage insurance, so the monthly payments are competitive to a lower rate loan.
• Fannie Mae HomePath Renovation – Fannie Mae properties only, for the home that you really love that has good “bones,” but little else (needs a lot of repair) another solid loan.
• FHA – (not FHA 203K see below) Unless you are looking at foreclosure properties that are in genuinely good condition, you are unlikely to find a property that will pass the stringent requirements that FHA guidelines provide for. If you are focusing on a foreclosure, it’s recommended to go with one of the other loans available.
• VA – Ditto FHA
• FHA 203K – Like the HomePath Renovation loan, this is also a decent alternative for foreclosure properties that are in need of substantial repair.

So, you have that pre-approval in your hot little hands and now it’s time to start looking!

Property Hunting

Spacious REO home in Lanai City (MLS# 351721)

Do yourself a BIG favor: choose a Realtor who has experience in REO/Foreclosure purchases—you really do need an expert to navigate this purchase for you. A Realtor with plenty of proven REO experience under their belt will make this process go smoother.

That Realtor is more likely to have answers for most of the tricky issues that could potentially come up and has probably encountered before. Better to be prepared for what may happen than to be blindsided with a problem another agent may not be aware of, or be less equipped to maneuver through.

Now that you are looking, if you are a first time home buyer, universal good advice? Lower your expectations.

What! Lower my expectations? Yes. Please! The reality is that you won’t find a MTV Crib your first time at bat. You may not fall in love with your first house right away, but once the repairs are complete, your pictures are hanging on the wall, and your furniture is all in place, you will love it and it will be home. Look at the bigger picture.

So, you have found the house you want, next step? Let’s make an OFFER!

Offers

This is not a normal purchase…there are different rules. Starting with: offers should always be emailed in PDF format. Please don’t FAX or send JPG’s. You will only succeed in annoying the listing agent if you do. Not a good way to start a possible 2 month or longer relationship.

1. If the property you are offering on is a brand new listing, be prepared to move very quickly. The best well priced listings are usually under contract within just 3 days of the listing going active.
2. There is no sugar coating this, as tempting as it may be, low ball offers are a no-no on new foreclosure listings. If there are other offers on the table, you can bet at least one of them is over listing price. Once the property has been on the market for some time (2 weeks or more) then you can make a lower offer, but on newly released listings that are seeing a lot of activity? The seller will not take you seriously. If making an offer over list price makes you nervous and you are worried about the difference in your loan payment, just call your loan officer. Oftentimes, the difference in the loan payment in a slightly higher offer can be negligible, indeed little difference, mere dollars per month over the lifetime of the loan. How badly do you want the property?
3. Don’t ask for pie in the sky in concessions. These properties are strictly “AS IS”. Sellers of REO properties generally will not grant termite inspections, survey, cleaning, or permit packages. Thinking of asking for cosmetic repairs? Don’t. In fact, for the most part, the only repairs that will even be considered are “lender required repairs”. If you load up your offer with lots of concessions, you may well fast track your offer to the bottom of the seller’s pile. What you can ask for (and most savvy buyers often do) is up to 3% back in Seller paid Buyer closing costs. Unless noted in a bonus incentive program, the seller will rarely credit more than 3% in closing costs. The cleaner your offer the more likely it is to be the one the seller likes the best. Offer smart and purchase smart!
4. Put as much down as possible. This is where USDA loan pre-approvals can be a disadvantage. Sellers look for the most money down and the fastest close.
5. REO inspection times allowable are usually 10 days. This time period can be limiting, especially for mainland buyers who wish to fly in for the inspection period. Unfortunately, sellers cannot and will not accommodate travel plans to prolong the inspection period.
6. The property is priced with condition already taken into consideration. Don’t send in comps to justify your offer price. The comps won’t be submitted. The seller is well aware of the market value of their property and has appraisals and BPO’s in place to support their asking price. Also, the traditional warm fuzzy letters about how long you have been looking and how little you have to spend hold zero weight with the seller. The truth is that your story has nothing to do with the seller’s goal. If your offer does not meet their bottom line your offer wont be accepted.
7. Typically, once you submit your offer, negotiations are done verbally by email. Generally, there is no need to submit a formal counter form. In fact, most of the REO sellers will only use their own forms and have little use for the Hawaii state purchase contract. This will vary from seller to seller.
8. If the property you are offering on is a brand new listing and there is a great deal of activity (showings), odds are that there will be multiple offers. Occasionally, between the time you receive the verbal acceptance and the signed “Real Estate Purchase Addendum”, the seller may have received another offer. In many cases, the seller will then send to all buyers a “highest and best” request. You are now competing against other buyers for the property. Be sure to understand that you do not have an accepted offer until the seller signs the document and sends it back to you.
9. And, of course, nothing beats CASH. A lower cash offer with a fast close will trump a lender qualified higher price, longer escrow offer almost every time.

Acceptance

1. Once you have submitted your purchase contract (PC), if the seller agrees with the price and generally on the terms of the PC, you should receive a verbal acceptance.
2. Don’t get too excited.
3. You will then receive a document called the “Real Estate Purchase Addendum”. This will take precedence over many of contingencies, terms and time frames you put in your original PC.
4. Review all of the terms and conditions in the Real Estate Purchase Addendum and insure that you are willing to proceed based on those terms.
5. Please do not make any changes on the Seller Purchase Addendum itself. If you want to make changes to the terms then you will need to itemize those changes on an addendum and send them to the seller’s agent to submit to the seller. Any changes you make to the seller’s contract (without authorization) will null and void the contract.
6. Please allow up to 4 days to receive the contract back from the seller. In the meantime, instruct your lender to proceed with the loan process and not to wait.
7. The seller will not negotiate terms after your offer has been accepted, so negotiate all terms before your offer is accepted.

Congratulations! Your offer has been accepted. You still have a long road ahead of you. We will take a trip down that road in a week or two with Foreclosures 101, Part 3. See you there.

I’ll have the top down, you are almost at your destination!

Related posts:

1. Buying a Home in Hawaii with a VA Loan – VA Mortgage Basics
2. Avoid Delay in Short Sales By Understanding Multiple Offers
3. Foreclosures 101 (Part 1): What You Need to Know and Do Before You Purchase a REO

When you purchase a single family home in a gated community such as Kohala Ranch or even in an ordinary subdivision such as Waikoloa Village, or a condominium/townhouse on the Kohala Coast, you are obligated to join that community’s homeowners’ association (HOA) and pay monthly or annual HOA fees for the upkeep of common areas and the building.

While there are laws governing the behavior of HOA’s, these associations can still have a powerful impact on your rights as homeowner. If you are considering purchasing one of these types of properties, here is what you need to know and how homeowner’s associations work before you buy.

1. Learn the HOA’s Rules and Regulations

You may be able to find a HOA’s CC&R’s online (i.e. Waikoloa Village Association documents) as well as information about what happens if you violate a rule.

In addition to maintaining common areas, HOA’s also set certain rules that all residents must follow called covenants, conditions, and restrictions (CC&R’s). Pay particular attention to rules regarding fines and whether the HOA can foreclose on your property for non payment of HOA dues or fines resulting from CC&R’s violations. If the rules are too restrictive, you may consider buying elsewhere.

2. Comply with HOA Rules

I have recently shown a property in Waikoloa Village where the sellers had transformed their garage into a small studio for family and guests visiting. Great idea…however, buying into an existing problem can be a headache, so find out what the rules are and whether you would have to make changes to the home to comply.

3. HOA Basics and Fees

Fees will differ from each communities. The more upscale the building and the amenities it has, the higher the homerowner’s association fees are likely to be.

In addition to the monthly fees, if a major expense, such as a new roof, comes up and there are not enough funds in the HOA’s reserves to pay for it, the association may charge extra assessment that can run into thousands of dollars. Find out what the monthly/yearly dues cover; what is included.

Also make sure you have answers to the following questions:

• How are HOA fee increases set?
• How often do increases occur?
• How large is the HOA’s reserve fund?
• Are any special assessments planned for the near future?

Compare dues for the neighborhood or resort community you are considering to others in the same area. Keep in mind that you will have to pay for recreational facilities whether you use them or not. Be aware that the HOA may have rules about how many guests can use common facilities.

4. Consider Your Temperament

Are you the type of person who hates being told what to do? If so, living in a community with a HOA may be a very frustrating experience for you. One of the major benefits of home ownership is the ability to customize and alter the property to suit your needs, but HOA rules can sometimes interfere with this.

Homeowners associations can be your best friend when they prevent your neighbors from painting their house neon pink, but your worst enemy when they expect you to perform expensive maintenance on your home that you don’t think is necessary, or impose rules that you may find too restrictive. Before you purchase a property subject to HOA rules and fees, be prepared and make sure you know exactly what you’re getting into.

Related posts:

1. Resort Condo Versus Single-Family Home – Costs to Maintain a Second Home in Hawai’i
2. Waikoloa Village Homeowners 2011 Dues Are Due
3. Homeowners’ Association (HOA) Dues In Waikoloa Village

Aloha Pumehana! I was showing a Los Angeles family coffee farms on the Big Island last week and learned that their background in financing was stimulating them to move their cash assets into real estate because it was a “tangible commodity.”

Since cash seems to be losing its value at this time, a safe option is to buy a property with mature, producing crops, and as much land as you can afford in a fertile place – so you can have a safe sustainable place to live with potential tangible crops to sell or trade when the financial market crumbles.

Coffee as a Tangible Commodity

This coffee is from a property we saw in Wood Valley on the outskirts of the Pahala – near the area where the Dalai Lama stays when he comes to visit the Big Island; a very peaceful place where the land is fertile, green, alive, and well.

This area is rich in soil as it is untouched by the lava – located in Lava Zone 6 on the southeast side of island. This property is also an active flower farm where they grow beautiful flowers, which they sell as bouquets and also to local florists.

Ornamental & Pharmaceutical Agriculture as a Tangible Commodity

Looking for a property that has a thriving business, or crops on it adds value to a real estate purchase. Even though the current owners of this fertile Wood Valley property will be taking their flower business with them, the outbuildings and existing raised garden beds will be left as-is, and have value for future business opportunities. Lots of potential for a thriving plant nursery, cut flowers, pharmaceutical agriculture, and lots of room for citrus, vanilla, cacao, and anything that can prosper at 2,200 ft. elevation!

Water Access as a Tangible Commodity

Having access to water in Hawaii is a very valuable commodity, especially when you own agricultural lands. Any property that has its own water holding tanks, private wells, water reservoirs, catchment tanks, and water filtration systems (for converting catchment water into potable water for drinking and cooking) has a very high value, and can be an asset to your multi-use options. 

Also, properties that have a fire hydrant within a 5-mile radius of the property have potentially better insurance options…something to research when looking at all the options according to your personal and business needs.

Real Property Taxes may also vary according to the crops you have permanently growing on the property. To learn more, call the County Real Property Tax Assessor and ask for the Agricultural Use Value of your present or future crops.

When you are ready to find your piece of paradise in Hawaii, give me a call! I would be happy to research any property and its potential to your business and personal needs.

Blessings & Aloha~

Claire K. Bajo, RS, SRES
808.756.4874
claire@hawaiilife.com

Related posts:

1. Veteran’s Benefits – Purchase Real Estate with VA Certificate of Eligibility in Hawaii
2. Ten Things Canadians (or any Foreign Buyers) Need to Know Before Buying Real Estate in Hawaii – Part 1 of 2
3. Ten Things Canadians (or Any Foreign Buyers) Need to Know Before Buying Real Estate in Hawaii – Part 2 of 2

If you can see yourself living the good life in Hawaii, here are some tips to get you started

If you are a Canadian that wants to buy property in Hawaii, there are 10 things you should know before you start looking for your Hawaiian home.

In the past few years, Canadians have been at the top of foreign buyers for Hawaii Real Estate. So, although Canadians should know a few points about Hawaii real estate before buying here, it’s still fairly easy for a Canadian to buy their dream home or condo in Hawaii.

So, here’s a look at the first 5 out of 10 things you should know before you buy:

1. Is the property fee simple or leasehold? In Hawaii, there are two types of property – fee simple or leasehold. Fee simple is the term for property where you own the land and all the improvements on the land. With leasehold property, you are paying for the improvements on the land, but do not own the land, instead you pay a lease on the land. If you are buying leasehold, you will want to know the terms of the lease. Also, it can be more difficult to obtain a loan on leasehold property as the loan needs to be for 5 years less than the time left on the lease.

2. Is this a “distressed property? In Hawaii, a large percentage of the properties for sale are distressed properties – either a short sale by the owner or a REO property. A short sale is a sale where the sales price is not enough to pay off the mortgage, so the transaction must be approved by the seller’s lien holder or lien holders. A REO is short for Real Estate Owned, this is property that has gone through the foreclosure process and is now owned by the bank. While there are many details to these transactions, the key points are:

• Because you need lender approval, the process will take longer than a normal sale – expect anywhere from 2 to 6 months…and maybe even longer.
• Distressed properties are almost always sold “as is” and often have been damaged and may have had appliances and fixtures removed.
• The buyer will often pick up costs that a seller would “normally” pay, such as termite inspection, cleaning of property, and staking of property. The buyer may need to pay for liens on the house, back taxes, or HOA fees (monthly home owner association fees). It is always best to know what these figures may be before you submit an offer.

Condo living is very popular as you have many amenities, but no responsibilities for exterior maintenance.

3. Unlike Canada, where a seller must bring a home up to code when selling, a seller does not have to repair a property before selling it. Hawaii law does require the seller to complete a seller’s disclosure on the property. However, any repairs paid for by the seller have to be negotiated into the sales contract, and in the case of distressed properties, the sale is usually “AS IS” where the seller will not perform any repairs, even those that may be considered a safety issue, but these are the types of homes you can often call a “steal of a deal.”

 4. You’ll need your finances in order before you write up an offer. In Hawaii, it is common practice that all offers to buy include documentation on the buyer’s ability to buy the property. If you are paying cash, you’ll need “proof of funds,” or a copy of statements that show you have the needed money for the sale. If you are using financing, then you will want to talk to a lender about getting a pre-qualification, or even better, a pre-approval letter from a lender that is licensed in the State of Hawaii. 

FYI, most sellers and seller’s agents prefer to see a lender they are familiar with, one that they feel can get the job done on a loan. You can ask your Realtor for some contact information of lenders that work in the local area.

5. It can take 45 to 60 days to complete your purchase. In Hawaii, this is the usual time to complete the sales process. The first portion of this time is used for buyer due diligence – home inspections, review of documents, review of seller disclosure – this will usually take 10 to 14 days.  

The remaining time is for the processing of a loan and the drawing up and signing of sales documents. If you are purchasing with cash, you should be able to close in 30 to 45 days.

So, this is the first half of the list of what you should know before buying your dream home in Hawaii. I’ll be back with the remaining five tips.

I love the Big Island! Aloha.

Related posts:

1. Ten Things Canadians (or Any Foreign Buyers) Need to Know Before Buying Real Estate in Hawaii – Part 2 of 2
2. Canadians Surpass Japanese for Foreign Investment in Hawaii Real Estate
3. The Seller “Prep” Talk For Hawaii Real Estate

What is a Short Sale?

A short sale is used when the owner of the property owes more on their mortgage or mortgages than the current market value of the property. For various possible reasons, the owner needs to sell the property. Since they owe more than the property is worth, a short sale may be necessary.  

In this case, they would need approval of the lender to sell the property. The process of short selling is very complex and many factors need to be considered in deciding to go down the short sale road. Below are the things to take into account for both buyers and sellers since the process is different for both.

What To Do If You’re the Seller of a Short Sale

When deciding to short sale your property, it is very important to be keenly aware of what a short sale means for you.

Talk to your lender: The first person to talk to is your lender since they will be your partner and will need to approve a short sale in order for the sale to take place. If you are experiencing difficulty making payments, talking to your lender is very important.

Talk to your accountant: The second person to talk to is your accountant. A short sale can affect your taxes and you want to know how the deficiency will affect them.

Talk to an experienced short sale real estate agent: The third person to talk to is your Realtor. The process of a short sale can take 3 months or 2 years or longer, so you will want a committed Realtor on your side. The paperwork involved in a short sale can be 20 times more complex and time consuming, so you will want someone who is familiar with short sales to help navigate the short sale process.  

Instead of buyer and seller negotiating the transaction, you have buyer, seller, and lender. All 3 must agree on the terms of the sale; the process is long and you will be required to submit many financial documents throughout the process, so be prepared to do a bunch of paperwork.

If you have an experienced short sale agent, they will walk you through the process. On the Realtor side of things, the work is also 20 times more time consuming than a traditional transaction, so it is important that the Realtor is experienced.

What To Do If You’re the Buyer of a Short Sale

Talk to you Realtor: As mentioned above, the process is long, so make sure that you have someone who has experience dealing with short sales to guide you through the process. Interestingly enough, it is more important for the listing agent of a short sale you are interested in to be knowledgeable than your buyer’s agent. If the listing agent is not familiar with navigating the short sale process, the chances of a successful sale can decrease.

Be prepared to wait and be patient: Sellers have little control of how the lender will handle the short sale, so they rarely can provide the answers that buyers have on things like timeline and what to expect from the process. Each lender is different and each transaction is different, so although the basics are the same, the length of time changes with each one. 

If you have a timeline that you must adhere to, such as needing to be moved in by a certain date, short sales may not be the best option since neither you nor the seller control when it closes.

For Questions or More Information

Short sales can be a great option for you, so talk to your Realtor about everything you need to know. If I had to write everything here in one article, my fingers would be bleeding with everything you would need to know and it would be more like a novel than an article.

If you have questions, or are thinking of short selling your property, let me know, I have done many and can help you navigate the complex process. Email me, or continue browsing for more Hawaii real estate.

Kelly A. Lee, (R), e-PRO, CHMS
Realtor-Broker
Hawaii Life Real Estate
Phone: 808.225.0349
Fax: 866.590.3144
www.hawaiilife.com

Related posts:

1. Short Sale Tips and Tricks for Hawaii Island Buyers
2. Hawaii Real Estate Buyer Tips
3. Avoid Delay in Short Sales By Understanding Multiple Offers

Looking for a luxury home in Kona at a great price? You need to dig a little deeper these days as the Kona real estate market continues to improve. With home inventories dropping, there is a pressure on prices to rise – and prices have – at both the low and high end. For now, prices remain stable in the one to two million dollar range.

Things are changing though, even in that range. The obvious best buys that I’ve discussed in past blogs have now all been snatched up. Short sales and foreclosures are next to non-existent in this price range now.

In the past few years, when a great home came on the market at a great price, my buyers had a few months to book their flights over and check it out. Now these homes are gone almost immediately. Here are three strategies and three homes that I suggest to my luxury buyers looking for a deal in the current market.

3 Strategies and 3 Homes To Consider When Looking For a Deal

1. The Motivated Seller

Many sellers initially list their home for too high a price. After a few months of no offers, they finally relent and decide to drop the price. In the past, I wouldn’t waste my buyer’s time showing them homes until the seller made the price drop. Now, if I wait until then, my buyers often face a multi offer situation.

To avoid that the trick is to catch the home while it is still overpriced, but the seller is considering the price drop. You need an agent who is out chatting with listing agents to catch these deals. This home (MLS# 250308), currently priced at $1.95 million (pictured below), is an example of a home that has a motivated seller.

It’s my guess that if the seller doesn’t get an offer soon they will be reducing their price. The seller is a builder and just completed this home. They sold another home in an adjacent neighborhood for a higher total price, but a much lower price per sq. ft.

I think there is some room here and would advise my buyer accordingly. This is a great house, brand new with a lot of features and amenities. Great view. The photo at the top is from this home’s lanai.

2. The Overbuilt Home

During the last boom, prior to the drop in prices, there was often no limit to the quality and materials that builders would put into new homes. This home (MLS# 239895), priced at $1.7 million, is a great example.

This home mimics the materials and style of homes built in Hualalai Resort; open walls, ohia posts, and a salt water pool. It is resort style at its best, but it’s not in a resort neighborhood. It’s a great house if you love indoor/outdoor living. The pool is a resort unto itself and the lanai has great ocean views.

It is in an upscale gated community just above Kona. The other homes, for the most part, are more traditional and older.

The majority of other homes currently for sale, or that have sold recently, are distressed homes in poor condition. This is a situation where the sellers may have to take less to get it sold. For the right buyer, this could be a great opportunity to get a first class home at a great price.

3. The Older Home in a New Home Neighborhood

New goes for a premium, especially now when so few new homes have been built the last few years. Bayview Estates is one of Kona’s finest neighborhoods. Many of the homes were built in 2005 with all the latest features, materials, and styling one would expect. 

The oldest home on the market was built originally as the model home and sales office for the neighborhood. This home (MLS# 245546), priced at $950,000, was built in 1990. At that time, it was the lastest and greatest.

It has been well maintained, has a killer view, and is priced well below the other new homes for sale in the neighborhood. If you don’t mind the older styling and/or are happy to do your own updating, this is a great home for the price in a great neighborhood.

Overview

None of these homes are a deal necessarily at their asking price and I don’t know if the sellers of any of these are ready to accept a lower price. What I do know is that there is an argument to be made and a good chance for a buyer to get a good deal. If we wait for the sellers to figure it out and drop the price, you might be facing a lot more competition. A well reasoned, sensible offer at this point might do the trick.

Related posts:

1. A Kohala Girl Looks at Luxury Kona Real Estate – 2011 Edition
2. Smart and Stylish Buys in Kona Ocean View Homes
3. Deal: Kailua-Kona Real Estate Best Bang For Your Buck On The Big Island

Aloha! I serve on the Public Relations Committee for West Hawaii Association of Realtors, and we discussed 3 reasons why sellers have a great opportunity to sell now.

3 Reasons Why Sellers Have a Great Opportunity to Sell Now

1. Low Inventory – In Kailua-Kona on the Big Island, there is currently only one 3-bedroom house on the market under $200,000 (MLS# 247881) – it’s selling at an appreciated value currently priced at $190,000 – it was purchased in 1998 for $154,000. There are currently only 14 three bedroom homes on the market in the $300,000 range.

2. Judicial Foreclosures will soon be flooding the market – We are expecting the judicial foreclosures to enter the market within the next few months, so pricing your home right to sell will be key to selling before the foreclosures flood the market. Though, you may still be able to sell at appreciated value, you may be competing with more properties and take a longer time to sell.

3. Cooperative Short Sales – For anyone going through a short sale situation (where you haven’t made a mortgage payment and you are waiting for the banks to give you notice to move out – title to the property is still in your name), there is a program called a Cooperative Short Sale, where the bank offers you money to leave the property so they can proceed with foreclosure to re-sell it. 

If you currently have your property on the market, you may be able to take advantage of this program as well. Contact your mortgage company and mention this if this is something that could be helpful to you.

When you think of Hawaii real estate and your property, please give me a call. I would be happy to offer a free consultation and Current Market Analysis, and also offer ways to sell quickly for the highest and best price possible.

…or visit my blogs for more information on Hawaii real estate! Mahalo!

Blessings & Aloha~

Claire K. Bajo, RS, SRES | Big Island Sales
808.756.4874
claire@hawaiilife.com

Related posts:

1. Tips on Pricing Your Hawaii Property to Sell
2. Pricing Your Hawaii Home to Sell Sooner
3. Home Staging to Sell Your Hawaii Home Faster

There hasn’t been a lot of new project sales worth mentioning in the past year, but I have to say, this Realtor believes this is the project to buy. The last project in the prestigious “Nauru” development area of Kakaako, Waihonua (which literally means “waters of the earth”) has all the makings and potential to become the “it” building.

Waihonua boasts 345 brand new pet-friendly units, energy efficient lighting and water heating, plus fabulous windows—expansive insulated, low-E glass window systems to suppress heat. Basically, it’s the first new project to start to have a hand in being energy efficient from the start.

The most recent developments, Hokua (built 2006) and Koolani (built 2006), either tripled in the past five years or increased in value by $200,000 to $300,000 respectively. I’m not saying that Waihonua will follow suit, but I would be amazed if it doesn’t. It’s the only spot left in the highly desirable Nauru skyline. It’s economics—supply is low and demand is high.

The craziness begins; vying for numbered tickets, these home buyers hope to get their number one picks

I was there the day the doors broke open to start the craziness that would be the sale of Waihonua 1, 2, and 3-bedroom condo units. Most people seemed to be interested in the 2-3 bedroom condo units, but my client and I were all set on our one-bedroom high hopes and were able to score the exact unit that he wanted. We were number 29 (remember, there are 345 units available). 

It was exciting to see such excitement over a brand new condominium building, a sight we haven’t seen for a very long time. Let’s hope there are good things to come. The building isn’t sold out yet. Check out the availability and price list and see if one could work for you: Waihonua Price and Availability List.

Some Tips When Preparing for the Purchase of a New Project

1. Do some recon: Ask your Realtor to contact the sales office to find out the specs, when to be there, how they will be running their sale, will it be first come first serve, etc.

2. Be prepared for anything: Even armed with this information, everything will not go exactly according as planned. Get there a little early, scope out the new rules, and grab a number if available.

3. Be patient: Make sure you bring your stamina because you’ll need it. It took 2-2.5 hours for most people to get through the contract process.

Brand new Waihonua Condominium promises new infusion of real estate breath in the Honolululu-Kakaako area; new things are on the horizon.

If you would like to take a look, or have any questions regarding Waihonua, please call Caron at 808.753.7464.

Related posts:

1. Kakaako Update: Waihonua Could Break Ground As Early As August 2012
2. Waihonua Updates: One Bedrooms Available and Prices Increasing
3. Waihonua: Senior Component to Luxury Living