Big Island Market Update – Third Quarter 2016: Still Going Up
By all accounts, 2006 was the historical height of the market. It was considered a “seller’s market.” Things went downhill quickly from there. Two years later, things had gotten so bad that foreclosures were the norm and “bottom feeders” happily submitted offers so low they would normally be considered insulting.
Ten years later after the market peaked, the median sales prices are rising quickly. In 2006, there were 344 residential sales in Hilo. We are currently on pace to reach 377 closed sales this year.
Watch this. Puna had 652 residential sales in 2006. The number of sales has already surpassed that total with 658 sales and we still have 1 more quarter to go.
As for pricing, the median priced home sale in Hilo 10 years back closed at $365,000. We are quickly approaching that price point. A home in Puna was closing at $269,000. Many areas have already hit that number as indicated above. Lower Puna, currently trending at a median sales price of $195,000, was very popular during the 2005/2006 run up.
The median price is still a bit sluggish at the higher price points, which means there are some fabulous properties and great values in areas like Leilani Estates, Puna Palisades, Opihikoa, and Kapoho.
It’s Really a Matter of Time
The National Association of REALTORS® (NAR) reports that the time on market decreased 4% this year over last while the median sales price (national) is up 9%. One of the biggest components of supply and demand is inventory. NAR reports a similar 9% decrease in supply.
Some numbers above might indicate a different direction when it comes to supply. My personal experience is that there’s a large group of sellers who have been waiting for this turn-around moment to enter or re-enter the market.
Bottom line is bottom feeders will soon be a thing of the past. Those looking for an extreme bargain will be facing steep competition. Offers on market rate properties should be fair and within a normal tolerance to be competitive. Buyers should come “ready to buy.” Cash and buyers with proof of their ability to perform rule.
Don’t See Your Neighborhood?
As always, if you don’t see your neighborhood reported, I’m happy to provide a custom report. Keeping up with your neighborhood on a regular basis is very easy. All you need is your address or TMK and I can arrange for you to receive periodic, factual updates right to your inbox. It’s the simplest way I know to determine if your piece of paradise is going up!