Kauai Real Estate Update- The real estate sales activities were a bit light last week which is normal for this time of year. That being said we had two big sales; Poipu had a $9,999,999 sale (list price was $13.5M and was on the market before at $1.5M and $1.650M) and the North Shore had a $8 Million sale (list price was $8.650M. For a complete list of all the activity last week click here; Kauai Real Estate Sales September 16 to 22, 2024.
Poipu Beach Real Estate Update- To get all the fee simple real estate activity since the first of the year in Poipu click here; Poipu Beach Current Market Analysis
Kiahuna Plantation Real Estate Update- Just Listed | Oceanfront 1 Bed 1 Bath $875,000 (LH)
Offered for sale for the first time since 1986 is Kiahuna Plantation unit #191 and, it’s so easy to see why this has been in the family for almost 40 years. The ocean views are spectacular and there is no better spot for watching the sun set than on your lanai or in your living room. Three oversized floor to ceiling louvered windows are on one side wall to take in the gentle trade winds and the no stair entry is perfect for those who prefer a true ground floor unit. This unit is a successful vacation rental, contact me for more information. For a current Kiahuna market analysis click here; Kiahuna Plantation Current Market Analysis
Hawaiian and Alaska Merger Is Official
Last week the DOT approved the merger between Alaska and Hawaiian Airlines and changes are in the works. To complete the merger can take up to 18 months.
Here is what Hawaiian Airlines said will be happening immediately;
👨✈️Both Mileage Plan & HawaiianMiles retain full value
👨✈️Lounge Members can access Alaska Lounges when flying Hawaiian
Coming soon;
👨✈️Mile transfers between both loyalty programs will happen at no charge
👨✈️Purchasing tickets Hawaiian Airline tickets on Alaska Airlines site (and visa versa) will happen
👨✈️Airlines are working with the FAA for the two brands to operate as one
👨✈️Air loyalty members who have accrued more than one million miles will be getting new benefits.
For Hawaii Residents new program called “Huaka’i” which will have an extra percentage off interisland tickets and a free bag. Even more percentage off and two bags for Hawaiian Airlines credit card holders. Sometime in 2025 Miles from either program can be redeemed on either airline. Loyalty program status will be matched with either airline.
Last week a home in Kukui’ula sold for $999,999,999 which, for all intents and purposes is $10 Million but why not just sell at $10 Million? The answer is; $15 Thousand Dollars.
Here’s why; the Conveyance Tax is paid by the Seller and is based on the sales price. There are two different rates; one for owner occupied (which is lower) and one for non-owner occupied (which is higher).
When working with my Sellers on an offer I’ll look at how these rates impact the bottom line. For this property here is the difference;
Selling to a non-owner occupant for $9,999,999 the Seller pays $110,000K. Selling for one dollar more at $10 Million the conveyance jumps up to another rate level and the conveyance tax is now $125,000. Factoring in the actual net is imperative here because my Seller will get less if accept an offer for $10 Million.
If I have two offers and one is an owner occupant and the other is a non-owner occupant the net is going to be different because these are two different tax rates. Taking the same property at the same price of $9,999,000 to an owner occupant the Conveyance Tax is $90,000K netting my Seller another $20K. This I’ll factor in when presenting the offers to my Sellers.
I’ve included the current tax rate sheet, you’ll see the amount varies by sold price points. The next time you see an odd number for a sales price, this could be why.
A “Tale Of Two Economies” For Hawaii
Getting things done on Kauai has always been a challenge, with the pandemic the challenge increased and we now have the dubious honor of being one of only three states that have not seen job levels return to pre-pandemic levels. Hawaii is behind by 3.5%, Louisiana is next at 1.5% and Maryland down 0.5%.
UHERO (University of Hawaii Economic Research Organization) latest research showed that the statewide labor force is likely to continue to lag for the next several years. Key factors contributing to this are “slow-growth mode” due to an aging population, low birthrates and residents leaving in larger numbers than they are moving here. Our population is predicted to remain flat for the next couple of years which means slower economic growth in some sectors.
“Tale of Two Economies” Hawaii’s tourism is expected to continue on it’s upward trajectory. Visitor arrivals rose 0.9% after rising 4.5% in 2023 and the projection for 2025 is expected to be 4% followed by 1.7% in 2026. These numbers do not apply to Maui which will continue to be impacted by the fires of 2023.
