Kauai Real Estate Update For Last Week- Mortgage Rates have leveled off a bit. For an 80% LTV purchase a rate is running with zero-ish points for a primary home at about 5.25%. You can buy down to approx. 4.99% with a little in points.
Housing inventory at this point is not getting any better, June saw a slowdown in home construction. Housing Starts, which measure the start of construction on homes, fell 2% from May to June, below the 1.4% gain that was expected. Starts for single-family homes, which are the most important because they are in such high demand among buyers, were also down 8.1%. Building Permits, a good forward-looking indicator for Housing Starts, fell 0.6% in June. Once again, single-family permits declined more significantly, dropping by 8%.
The National Association of Home Builders (NAHB) chairman, Jerry Konter, said, “Production bottlenecks, rising home-building costs, and high inflation are causing many builders to halt construction because the cost of land, construction and financing exceeds the market value of the home.”
For a complete list of what Sold, was Just Listed and what went into Escrow for last week click here: Kauai Real Estate July 25 to July 31, 2022
Poipu Beach Real Estate Update- For a complete update on the Fee Simple real estate market in Poipu since January 1 click here: Poipu Beach Current Market Update
For Kiahuna Plantation click here: Kiahuna Plantation Current Market Update
Koloa Village Is Coming Alive!
Located across from the Post Office in Koloa Town is the new Koloa Village, the South Shores newest shopping village. There are a number of stores that are open and I was surprised at the number of stores that will be opening soon. This looks like it’s really going to be a nice shopping center and really nice addition to Old Koloa Town. There is plenty of parking and the center is really easy to get in and out of.
For those of you that like Kiawe Roots they will be opening a second location here. They will be opening in 2023, can’t wait!
Department of Transportation Responds to Public Outrage Airport Expansion
When it comes to the proposed Lihue Airport expansion Governor Ige said the Hawaii Department of Transportation is “tone deaf” to the people on Kauai. Kauai’s Mayor Derek Kawakami said on July 8th at a Town Hall meeting that he is “officially opposed” to the Lihue Airport expansion. The public has been very vocal about their opposition so this will not be happening.
The DOT had proposed to extend the number of gates at Lihue from 9 to 12. The Airports 20 year master plan expired 13 years ago and all agree that work needs to be done at the Lihue Airport but adding the capacity for more planes is not acceptable.
On the list of items that the public wants to be addressed at the airport are: lack of ac, security bottlenecks, lack of food options and airport parking. Rather than allowing more people to come the politics are leaning more towards curbing the explosion of tourism the island has been experiencing. State transportation officials said the new plan they come up for the airport will “adopt a new focus on overtourism prevention”
Kauai Real Estate Year-To-Date July 2022 vs 2021
Below is a graph of the Kauai Real Estate market at the end of July 2022 vs July 2021. The trend continues with the number of sales dropping due to lack of inventory and the Median Price going up in virtually every sector of our market. Something to keep in mind when looking at this graph is some of these sales would have started before the rise of the interst rates.
In my opinion the impact of the interest rate increase has not shown itself in these numbers yet but, it is showing in the day to day life of a Kauai Real Estate agent. Since May, the Kauai real estate activity has significantly slowed down and the scenario of pricing a property “X” amount of dollars over the last sales price and getting multiple offers is not happening in all price points however, it is still happening.
Some Sellers think it’s still 2021 and some Buyers think it’s the “Crash” of 2007 and both sides are holding out to see who blinks first. The reality is neither side is correct and this impasse will pass, people still need to buy and sell real estate.
These numbers are general in nature and might not reflect your particular area of interest. Contact me to do a deeper dive on how this information relates to you.
(Every month I do a video on the Housing Market and the Condo Market for my Social Media and sometimes it does not go smoothly! This video is an outtake, I'm not ready for Prime Time yet!)
