The year thus far has been a definite improvement over the first half of last year and the market has certainly seen more activity since the beginning of this year. The improving jobs reports and overall economy, prior to recent news reports, have translated to more confidence that we are generally moving in a positive direction. We have been fortunate that interest rates have continued to be favorable for real estate purchases and investment, currently at their lowest levels in history. Real estate prices continue to bump along the bottom, offering some of the best deals seen in years. We are happy to report that despite recent events in Japan, travel to the Aloha State is up this year. While the upper end of the market continues to be steady, we are also impressed with the resilience of the lower and mid ranges of the market, which have been quite active.

Mauna Kea Resort has seen a marked increase in activity in the past 6 months over our last report. There are now two condos, one lot and three homes in escrow and 5 condos, one home and four lots have sold in the past 6 months; that is a 250% increase in closed sales and a 50% increase in escrows. Prices for units at Wai’ula’ula have come down recently and as a result, two units have gone into escrow shortly after they were listed. We currently have the best deal in Wai’ula’ula; M-201, being 3 bedrooms and 3 bathrooms, has beautiful ocean views over the golf course and comes fully furnished, asking $895,000. Activity at Kauna’oa has been quite strong, as three lots and one villa have sold, and another villa is in escrow. Building activity in the project has been impressive as well, with four homes under construction and a few others about to break ground! Homes at the resort start at $1.299 million and range to a 5 bedroom, 6 bath 5,800 sf custom home on the front row of the Fairways North, a spacious detached game room/media room/bar, large office and expansive covered lanai overlooking the infinity edged pool out to the golf course and the ocean/sunset views at $4.995 million. Ocean view condos start from $550,000 and include a newly listed, recently renovated 3 bedroom Villa with white water ocean/sunset views at $2.4 million. Vacant lots are priced from $549,000.

Mauna Lani Resort has again been quite active in the last six months, showing that if there is good product available at good prices, sales will occur. There have been forty condos, one lot and four homes that have closed in the resort in the past six months. There are currently 16 condos and two lots in escrow. Obviously, condos have been the strongest market, due to price reductions in virtually all projects; number of sales are up 50% and number of escrows are up 30% over our last report of 6 months ago. We have seen price reductions on some very good product at the resort, including a 1.37 acre oceanfront lot, now at $4.95 mil, a rare 3 bedroom, 2,000 sf oceanfront condo at the Terrace down to $2.25 mil and a 2 bedroom, 2.5 bath golf fronting unit at Pauoa Beach down to $1.695 mil (over $700k below the last sale!). Homes at the resort are for sale from $1.85 million to $14.9 million, while lots in various locations are priced from $495,000 to $4.95 million, including a .7 acre ocean view parcel in Pauoa Beach for $1.1 million, down almost 50% from its high! Condos run from $350,000 to $3.295 million. There are a number of homes under construction at the resort in various locations and some very good opportunities to find properties in the resort at the lowest prices in years.

Condo sales at the Waikoloa Resort have been very strong in the first half of the year with 58 closed sales and 31 units in escrow. That translates to an almost 20% increase in closed sales and about the same number of escrows
over the prior 6 month period, which was very strong. Prices for condos in the resort range from $250,000 to $3.495 million for a Kolea 3 bedroom penthouse …once again, some great buying opportunities out there, with lots of inventory and relatively low pricing. We currently have a beautiful 3 bedroom, 3 bath customized villa at Kolea with close proximity to the beach at an unbeatable value of $1.075 million.

Hualalai and Kukio Resorts have continued to be very active markets on the coast in recent years and the past 6 months has been similar. There have been seven closed sales of condos between the two resorts in the past six months and there is one in escrow. Eleven homes and nine lots have also been sold in these resorts, divided almost equally between them. We just received a price reduction on one of the best built and designed homes at Hualalai Resort, with 6 bedrooms totaling over 5,800 sf, including a private guest house, large 3-car garage, sand entry pool with swim up bar, panoramic ocean/golf course views and expansive covered lanais that wrap around the home adding almost 2,000 sf of entertainment space; just reduced $600,000 to $7.295 million; this home had originally been listed at $11.9 million!! There is currently a good selection of homes, lots and villas available in the resort at the current time. There are still some very motivated sellers willing to consider offers.

The Puako/Waialea area has been relatively quiet in the past 6 months. There have been two sales of oceanfront cottages recently in the low $2 million range and one 6.7 acre lot at the beginning of the street traded at $5.6 million; those owners are now offering 2.36 acres of that parcel for $5.9 million. There are currently oceanfront properties in Puako ranging from $3.2 to $5.9 million. Mauka properties range from $799,000 to $1.219 million, depending on improvements and location.

In the Waimea, Waikoloa and the surrounding areas, the market is still moving briskly, although a little slower than the previous 6 month period. There is quite a bit of inventory out there and much of the activity has been in short sales and foreclosures. In Waikoloa, 52 homes have sold in the past six months, with 20 in escrow. The condo market in Waikoloa has also been robust, with an additional 30 units sold. In Waimea, there have been 47 homes sold in the past six months, up considerably from previous years, and there are 35 sales in escrow; that is 50% more sold and double the number in escrow than the previous 6 months! Lower prices in both areas are definitely fueling interest.

Kohala Ranch and the surrounding developments remain steady; there have been eight homes and 15 lots sold in this area, which translates to a 30% increase in home sales and triple the number of lots sold in the previous six month period. There are six homes and three lots in escrow. There are some very good deals in these areas at excellent values, including a recently listed 4 bedroom, 3,200 sf furnished home on one acre with awesome ocean/coastline views at Kohala by the Sea for $1.295 million and the best priced oceanfront lot at $895,000!

Visitor arrivals are expected to increase 3.8 percent, slightly lower than the previous forecast of 4.0 percent. The forecast for visitor days in 2011 is now expected to increase 5.1 percent, one percentage point higher than the previous forecast. The forecast for visitor expenditure in 2011 is also revised upward to 10.8 percent, from 9.2 percent growth projected in the previous forecast. For 2012, the growth rates of visitor arrivals, visitor days, and visitor expenditures are now expected to be 2.9 percent, 2.7 percent, and 5.5 percent, respectively.

Many people are obviously making the decision to buy and be here to enjoy their lives in the present, rather than wait until the rest of the crowd decides to jump in; which will happen eventually… it always does.

We thank you for your business, and hope you have a good summer season.

Steve Hurwitz, President
Windermere/ C and H Properties

Agents, buyers and sellers alike are currently being inundated with market “analysis” and “commentary” relative to the current and, indeed, future of our housing market in the U.S. and the disparity between the opinions is vast. There are some who are projecting a further 20 percent decline in values and others who believe that we have bottomed out and a recovery is around the corner. It is all immensely confusing.

So, what is the likely direction of housing as we move forward with our overall economic recovery?

It is our opinion that the mass pricing declines that we saw were a function of a meltdown in the market and that we have seen the worst of the price declines. As we move forward, the recovery in real estate will not be on a national level but will be market specific, with some areas faring better than others. We expect that markets with better employment prospects, topographic and political restrictions that limit new development and lower foreclosure activity are likely to fare better than others. The US Census bureau shows that we live in a country with 310 million residents and over 77 million owner-occupied housing units; to suggest that a recovery will be equal across the country is naive.

The core of Mr Case’s argument is that the “Dream” very much depends on what one’s expectations are. If house buying is driven by the expectation of astronomical returns, then it is fair to believe that this will not be the case going forward. However, if buyers are realistic in their expectations of value and a good rate of return, that a home represents stability, offers tax incentives, as well as managing the fundamental need for shelter, then home ownership does indeed still make sense. (Historically, housing has always appreciated at a greater rate than inflation and if you believe that inflation is certainly headed our way, it should act as a good hedge against it.

There is an old adage that all real estate is local. We agree. As we move forward, expect markets to fluctuate depending on the above criteria. Fear mongering does nobody any good and we hope that we will see less of this occurring as data continues to point toward improving economic conditions.

And here, on the Big Island, real estate is a most valuable commodity indeed.  Limited topography, ideal weather, and good old healthy sunshine and ocean sports to enjoy can’t be argued with.   There is only so much paradise in the world.

Despite the increase in activity, there is still a good selection of homes, condos and vacant land available in virtually every price range. Many of the lower priced condo projects have seen renewed interest from buyers and the high end of the market has definitely been more resilient, as several multi-million dollar homes have sold in various locations over the past six months. There are still opportunities for the savvy buyer and deals are being made in all sorts of creative ways. There is excellent financing at some of the lowest rates in the past 40 years available to buyers in every price range looking for their special place in Hawaii. Transactions are being consummated with those sellers who are listening to what the market is saying; however we have seen many potential sales that go by the wayside due to the lack of flexibility on either side of the table. When you look at the activity below, you can see that sales are being made across the board and it appears that we are probably somewhere close to a bottom of the market.

Mauna Kea Resort has seen some select activity in the past 6 months, with condos and lots in the newer projects selling in that time frame.  Kauna’oa, which is an upscale project on the ocean side of the highway with its own private Weiskopf designed practice golf course and a private Club/Spa amenity, has closed another sale of a 3 bedroom, 3,700+ sf villa at $2.3 million. There are still a few prime units available from the mid $2 million range on up, including some of the best view units in the project that are the most recent to be completed.  Wai’ula’ula has closed 2 sales in the past 6 months and has an additional 2 units in escrow.  There have been five lots sold at the resort in Kauna’oa in the past 6 months; this is the most activity in vacant land sales within the resort in the past few years.  Presently available at Mauna Kea are homes from $1.465 million, including a 6 bedroom, 5,000 sf home on one of the best lots in the Fairways North at $3.95 million, condos from $750,000 and vacant lots priced from $693,000.  It is interesting to note that all of the recent vacant land sales have been to individuals who want to begin construction on their residence as soon as possible; this is specific evidence that much of our market now consists of owner-users.

Sales in Mauna Lani have also been more active in the last six months, especially in the condo market.  There have been 26 condo sales with thirteen more in escrow, while four homes have sold in the $3.55 million to $13 million range.  There have been two lots sold, including our listing of a fabulous one acre oceanfront parcel with sunset and coastline views that sold for $4.3 million. We just listed a beautiful 6,150+ sf bank owned, custom designed 5 bedroom home with top of the line finishes and appliances, within short walking distance to the beach/beach club at Pauoa Beach, which is now probably the next home to sell at Mauna Lani and an excellent value, priced at $6.5 million; about 50% off of its original price a few years ago. We also just listed a 3 bedroom+ den, 3.5 bath, 2,400+ sf totally remodeled and newly decorated oceanfront luxury townhome in the best location in the Mauna Lani Terrace, priced at an incredible $2.995 million; the views are spectacular and the walk to the beach location is unparalleled by any project in any resort! Condos at the resort range from a very reasonable $379,900 for a 2 bedroom unit at the Palm Villas. Homes in the resort are currently priced from $1.63 million and lots at the resort start at $550,000.

Condo sales at the Waikoloa Resort have been relatively strong in the last 6 months with 45 closed sales and a very robust 27 units in escrow; this activity is spread across all but one of the projects at the resort, but most of these sales were in the newer projects.  Prices for condos in the resort range from $264,900 to $3.495 million for a Kolea 3 bedroom townhome.  We recently listed a decorator furnished 3 bedroom townhome in Kolea at $1.495 million, which is the lowest price for a comparable unit. We also have a ¾ acre oceanfront parcel in Naupaka Place with sunset views and a short walk to all, reduced to $2.975 million and the best deal for an oceanfront resort lot on the coast. There are several properties within the resort that are available at the lowest prices seen in years.

Hualalai Resort has been one of the more active markets on the coast recently. There have been 17 sales closed at the resort in the past 6 months, including the all time record of $26.25 million for a 6,000+ sf home on two front row lots.  We recently listed one of the best priced homes in the resort, with 4 bedrooms totaling over 4,500 sf, panoramic coastline views and expansive covered lanais that wrap around the home adding 2,000 sf. of entertainment space; all for $6.95 million. There is a good selection of homes, lots and villas available in the resort at the current time.

Kukio was the most active resort market for vacant land in the past 6 months as a result of significant discounting by the developer and some private sellers. The developer slashed prices on much of its inventory, including the oceanfront KD lots on the north side of the Kona Village; these lots sold at one time for over $8 million and have recently sold in the $4 million range and there are now only two left. A total of 23 properties, including 16 lots, have sold in Kukio in the past 6 months. The best deal in Kukio proper is a 23,000 sf parcel with ocean and golf views, in a quiet location away from the highway and priced at $1.495 million.

The Puako/Waialea area has had a fair amount of activity in the past 6 months as well.  There have been 4 sales in Puako in the past 6 months, including two oceanfront and two mauka properties.  There are two sales pending, including a 4 bedroom home with pool on the ocean that we had listed at $4.5m; this seller lowered the price and the property sold within 30 days, after receiving 3 offers! There are currently oceanfront properties in Puako ranging from $2.75 million and mauka properties starting at $1.18 million. Prices have come down in recent months and this could be a good opportunity to buy in this highly prized area.

In the Waimea, Waikoloa and surrounding areas, the market is still moving, albeit somewhat slower; there is quite a bit of inventory out there, which may be slowing some of the sales activity. In Waikoloa, 31 homes have sold in the past six months, with 25 in escrow, which is fairly strong.  In Waimea, there have been 33 homes sold in the past six months, down from last year and there are 10 sales in escrow.  Sales of vacant land in both areas are up substantially.

Kohala Ranch is a more active market than it has been in a while; 7 homes and 6 lots have sold in the past 6 months. We just listed a beautiful custom Kohala Ranch home on 5 acres in a very private location in the Heathers. Offering 3 bedrooms, family room and office totaling 4,200 sf, it has hardwood floors, granite counters, a large outdoor entertainment area and covered lanai, ideal for indoor/outdoor living, plus an awesome ocean, coastline, sunset and Mauna Kea view; all for $2.2 million!

Hawaii hotels and businesses across the state are anticipating an increase in Korean visitors this year as South Korea emerges as the next market for state tourism promoters. The US granted visa waiver status to South Koreans in 2008 and direct flights have been added in anticipation for the group, which tourism officials view as a promising and potentially lucrative boost for Hawaii’s tourism industry. A strong media blitz in that country has already begun.

On another positive note, for the second month in a row, the state saw an increase in average daily visitor spending. For the first four months of 2010, total spending by visitors increased by $132.8 million, which is 4% higher compared to the same period last year. Total arrivals increased by 3.6% from year to date 2009. Hawaii Island saw a 5.7% increase in visitors in April and the availability of more direct flights compared to last April supported this increase. The Big Island also saw a 7.2% increase in total expenditures year to date over last year.

Based on the sales data, our market seems to be more resilient than many on the mainland. Most likely this is because of a fairly tight entitlement process, which limits growth and development considerably, and the wide appeal our island has to people all over the world. Activity begets activity, and we are seeing that the recent sales increases are helping boost activity in other areas that have been slow. Many people are obviously making the decision to buy and be here to enjoy their lives in the present, rather than wait until the rest of the crowd decides to jump in; which will happen eventually… it always does.

Authored by Steve Hurwitz, R, BIC and President, Windermere/ C and H Properties

We start by letting go of the home layer by layer.

Both buyer and seller benefit when the seller- perhaps with some judicious coaching form their skilled REALTOR® – peels away those things that made their home uniquely theirs. In essence, the serious packing begins once the decision has been made to sell; bookcases and closets should only suggest their function with a few items, rather than store seasons and years worth of books and clothes. Carefully removing prized collections and family photos is also vital. Nothing should distract the buyer from seeing the house, and seeing themselves it in.

Personal colors are just as important to remove as objects. After all, if you were serving ice cream to a few thousand people  - (that’s how many will see your house photographs online) – would you serve them mango flavor?   It’s a lot more likely you would choose vanilla. And that’s pretty much what the color of your walls should be – neutral or deep neutral tones.

The last touch is a good deep cleaning. Ask your REALTOR® if they have the name of a reputable company.

The seller can then replace those familiar objects with a fresh new welcome mat at the front door. This process allows the buyer the visual and emotional space to move in.

This process also allows the seller to move on.

by Guest Author, Kathryn Madison, a real estate broker out of Windermere Portland-Raleigh Hills.  From Windermere’s Blog Neighborly News.

Kailua-Kona had more than 100 bank-owned properties in the first quarter of 2010, nearly eight times the number there were in 2009.  Some sources believe that first-quarter number is higher than expected because there was a hold on starting new foreclosures during the fourth quarter of 2009 because of the holidays.

The Big Island is seeing bank-owned properties increasingly have an effect on traditional home sales prices as banks continue to lower prices to get the asset sold. However,  some homeowners are beginning to fight back against foreclosures and two new federal programs may help reduce the number of homes being repossessed by the banks.   The Home Affordable Modification Program and the Home Affordable Foreclosure Alternatives Program may be the way some sellers are able to slow down and take some control of the process.

Predictions are that the number of bank-owned properties is unlikely to go down before the general real estate market and economy come back again because REO’s tend to be a lagging indicator.   But as the market starts to shoot up again, they should begin to taper off.   (Source:  J. L. Magin – Pacific Business News)

- you recognize familiar faces as you pass them in the grocery store
- you know the name of the guy behind the counter at the post office
- you will get a call from the boutique when your favorite brand of dress comes in (and before your size is sold)
- you know your neighbors by FIRST names
- you barbecue with your friends at a moment’s notice.

That’s the PEOPLE.

But there is more. It’s about the LIFESTYLE.

- you can take an ocean swim in the morning before work sometime with a dolphin escort
- you can watch the sunset from your lanai, or
- you can watch the sunset with a mai tai in hand from your favorite ocean-front “drinkin’ hole” — usually with a plate of freshly caught sashimi
- you can hike the trail that King Kamehameha himself created to travel the island
- you can explore parrot caves
- you can jump on a bike and do the Ironman ride to Hawi and back. All 112 miles of it! (Or, for my style, jump on a bike and go to the coffee shop for a Kona Coffee cappuccino!)
- you can… you can… you can…

That’s the LIFESTYLE!

That’s why I’m lucky. You can be “Lucky you Live Hawaii” too.

Yes, you CAN!     Author:  Tanya T. Power

Did you know that vanilla is grown on our island? I didn’t, but my friend did. She also pointed out that there is a sea horse farm here – I knew that and was interested in it but never got around to actually visiting. Those were our first scheduled events.

Ocean Rider is the first and only seahorse farm dedicated to preserving the endangered seahorse. After an antibacterial scrub down of arms and hands, we were admitted to the tour which was very interesting, informative and very well presented. We saw not only seahorses in various stages of development; we also saw their food growing. Finally we got to the fun part where we actually got to hold our own seahorse! More accurately, the seahorse curls its tail around your finger as it would hold on to something in its natural reef habitat. But that was not the end – the grand finale was a visit to their aquarium where there is a magnificent collection of different varieties of seahorses. And now time to head on up north for lunch.

Hawaiian Vanilla Company is located in Pa’auilo on the Hamakua coastline. Reservations are required for this is excellent gourmet luncheon dining, served by their extended family. Our very tasty lunch was accompanied by a short talk by the owner about vanilla’s place in the world, their learning experiences in starting their business, and the products that they are now manufacturing. A short walk took us to the growing sheds – all in all a delightful experience!

Of course we had to do the helicopter tour with Blue Hawaiian Helicopters. So much has been written about these tours that I’m not going to say anything other than that it is always worth the time and money, and one always sees something new.

Of all of our adventures there are two that really stand out: A swim with the spinner dolphins and the zipline trip. Check-in for Dolphins Hawaii’s excursion is at 6:30am at Honokohau Harbor. We boarded a 14 passenger boat with Captain Veto, and took off to see the dolphins. Since it is still “whale season” here, we saw lots and lots of them, plus a few spinners playing – a photographer’s delight. Then we arrived at our destination as the sun was coming up over Hualalai, put on our fins and snorkel gear, and slid overboard to see literally hundreds of dolphins! As long as we stayed still and quiet in the water, they swam alongside us as though we were part of their family. Much has been written about people disturbing and exploiting these wonderful creatures, however Captain Veto, as a certified Marine Mammal Naturalist, was very careful that we observed all the rules, did not touch, threaten or disturb these creatures as they went about their routine. What an unbelievable treat to be able to share their habitat in such close proximity – and we could even hear the whales singing in the distance!

Our grand finale was a zipline adventure that begins with sign-in and gear-up in Hawi, on the northern tip of the island. My friend had ziplined in Costa Rica so was an old hand, but I approached this endeavor with some trepidation since I had been told that there was a suspension bridge involved. Well, as a long-time skier I have taken off on some pretty scary steep inclines, but anything similar to a suspension bridge is another issue entirely. Hmmm…. The six-wheel drive trip to the venue was great fun – particularly because our two guides, caretakers, instructors, whatevahs, were both happy-go-lucky local boys, born and raised in the Hawi area. When we got to the first zipline, which was short and not very high, we got a feeling for the process and learned about our gear. We then walked through the forest to increasingly longer, faster, higher ziplines and were feeling very proud of ourselves.

In the back of my mind all of this time was the suspension bridge. We did a couple more zips – such fun you cannot imagine, zooming over the treetops and being caught by one of our trusty “keepers”! Then we came to the suspension bridge. To make a long story short, I did it, but I was plastered to Kenika’s back like a second shirt, and he probably still has bruises on his right shoulder where I was hanging on. Of course they save the best for last and the final zip was just a serious thriller. This one involved a running start and a drop off a cliff and it was a FAST ride! Obviously by then we had learned to trust our harnesses and just enjoy the ride, so we did – yelling and cheering all the way! What a day! You guys are da bomb!

There is so much to do on our island and we only scratched the surface. We also missed a lot of superb shopping and tons of restaurants, so my friend will just have to return soon.

We hope YOU come and enjoy these treats too! Author, Jean M. Gray

There has never been anything SHORT about short sales! Sellers, Buyers and their agents have waited months and months to hear answers from lien-holder institutions. Many agents tried to ignore them completely in the beginning only to find that a greater part of the inventory for their buyers consists of them.

With a new government program announced in November 2009 to be in effect April of 2010 there may be a way for hundreds of thousands of delinquent borrowers who have not been rescued by the loan modification program to shed their houses through a streamlined and standardized short sale process. In order to bring the various parties to the table – the homeowner, the lender that services the loan, the investor that owns the loan, the bank that owns the second mortgage on the property – the government intends to start paying cash.

Under the new program the servicing bank will get $1,000 as will a bank holding a second loan, if there is one. And as an incentive to homeowners a “relocation assistance” allowance of $1,500 will be paid.

Under the new federal program, a lender will use real estate agents to determine the value of a home and thus the minimum to accept. This figure will not be shared with the owner, but if an offer comes in that is equal to or higher than this amount, the lender must take it. The borrower must still make their case concerning the financial hardship they are experiencing but being able to sell a property “short” could provide many benefits.

For the investment pools that own many home loans there is the prospect of getting more money with a short sale than with a foreclosure.

For the borrowers, there is the likelihood of suffering less damage to credit ratings and they will also get the lender’s assurance that they will not later be liable for the unpaid mortgage value.

For communities, this plan could mean fewer empty houses, and fewer vandalized properties which serve to erode the value among neighboring homes.

Streamline and standardize the short sale process? Wouldn’t that be something! Here’s to this newest program proving to be a great success.

The state with the highest rate of foreclosure starts was Nevada, at 3 percent of the market.

Some economists suggest that the nation’s wave of foreclosures may be starting to end as evidenced by the percentage of loans that are 30 days past due. The figure fell from 3.79 percent in the third quarter of 2009 to 3.63 percent in the fourth. Which, statiscally, represents a big decline. That’s the bright side.

Buyers are finding well-priced real estate at the high end and low end of the market. The middle of the market still remains slow. Investor buyers are coming back as they are able to free up equity from properties that are selling in other parts of the nation.

It is a great time to be buy Hawai’i real estate.