For the past dozen years I have written annual real estate market reports for North Kohala. One report covers the portion with Hawi and Kapaʻau zip codes, and a separate report covers the Kohala gated communities near Kawaihae. Here are links to the market report for 2020 and, for context, the review for 2019. To anyone familiar with national real estate trends for 2021, the overall picture of record sales and prices will not be a surprise.
Kohala Home Sales and Prices Break Records in 2021
The combination of an influx of malihini (newcomer) buyers and historically low interest rates increased the number of sales and pushed up home prices in Kohala and throughout Hawaiʻi in 2020. That trend continued full force throughout 2021. Along with buyers who were seeking a different post-pandemic lifestyle, we began to see “climate change refugees” fleeing poor air quality due to fires in the Western states.
Last year, Kohala numbers reflected more sales at higher price points driving the median price higher. This year we saw examples of individual homes being “flipped” for significant short term gains, an indication that in absolute terms prices are rising as well.
- 75 homes sold in 2020 in Kohala, compared with 65 homes in 2020.
- The lowest price a home was listed in 2021 was $209,900 for a bank-owned “tear down.” It sold in a bidding war for $241,000.
- The highest price sale was $ 4,150,000 for almost-oceanfront two parcels in Niuliʻi, a total 43.89 acres with a small dwelling on one of them.
- The median home sale price in the Hawi to Kapaʻau area rose from $511,250 in 2019 to $577,000 in 2020 to $605,000 in 2021. The median home price now represents a plantation-era home on a 15,000 sq ft lot.
- There are currently only 11 homes for sale in Kohala, priced from $499,000 for a tiny house in a gulch, to $4,495,000 for the completely renovated equestrian estate at Puakea Bay Ranch.
Fewer Opportunities for Local and First-Time Home Buyers or Investors
Only 14 homes sold below $500,000 in 2020, compared with 23 in 2021. In part this was because there were fewer homes for sale. Demand from both newcomers and first time buyers taking advantage of low interest rates also pushed home prices above where they were at the last peak. We are seeing record high prices for what should be the “affordable” homes in Kohala.
Here is one specific example. A “fixer upper” house in Halaula near Kapaʻau that sold for $275,000 at the end of 2019 was renovated in 2020 and resold for $430,000. That same home sold again one year later for $599,000!
Homes that sold between $500,000 and $1,000,000 had another record year as prices got pushed up. There were 40 sales in this range in 2021 versus 29 sales in 2020. In more than a decade of writing this annual real estate market report this is the first time that homes in this price range were not mostly properties on acreage. Only seven homes on at least one acre sold for under $1 million.
Kohala Residential Sales Over $2 Million No Longer Limited to Gated Communities
There were also 19 sales over $1 million, almost double the number from 2020. Seven of these were over $2 million, compared with only four in 2020 and one in 2019. Three of the sales over $2 million were in Puakea Bay Ranch. However, we are seeing more of a demand for homes on large acreage outside of the gated communities, primarily younger buyers who envision a more sustainable lifestyle.
My next blog post, on 2021 land sales in Kohala, will overlap in that regard, as several sales were primarily for land value, with only small ʻohana or managerʻs cottages and room for expansion.