As far as real estate is concerned, one thing has been made clear in 2015: the Big Island is the place to be.
Home sales are on the rise countywide, with buyers coming from around the state, the mainland, and countries as far-flung as Switzerland — to say nothing of the increase in local homeowners.
Realtor Nancy Cabral, owner of Day-Lum Properties called 2015 “the best year since the crash of 2008.”
“It’s been recovering for a long time,” she said of the island’s market.
With the exception of North Kohala, the most expensive area on the Big Island with a median home price of $610,000, every district saw its home sales market improve. Kohala’s market tends to be impacted more by high-value residential properties, said Kehaulani Costa, executive officer of the Hawaii Island Realtors.
“A big $7 million sale will spike and skew the statistics in Kohala,” she said.
Through the end of last month, home sales for the entire island have increased slightly more than 7 percent over 2014’s numbers, according to data collected by Hawaii Information Service.
One area has been a bit more hot than others.
“Anything in Puna,” said Kenneth Heinemann, a real estate agent for Aloha Coast Realty. “We’re very happy and grateful of that.”
After the June 27 lava flow last year threatened Pahoa, a moratorium was put in place for new insurance policies or coverage expansion in Puna and home sales dipped in the area. But sales began to increase again early this year. The residential insurance moratorium was lifted this May; the commercial moratorium followed a month later.
To date, Puna has moved the largest number of homes on the Big Island this year, with 585 sales. It’s a slight but significant 16-home increase over last year. Though the median home price in the area has slipped to $172,000, the second-lowest on the island after Ka‘u, overall sales volume remains almost exactly the same as last year’s.
After Puna, North Kona had the most homes sold this year with 418 total.
And the Hilo market is still robust, Costa said.
“It’s a good time for people to put their house on the market,” she said. “Inventories are still tight in Hilo.”
A potential downturn in the market in the wake of the busiest hurricane season on record never happened.
“You’re always prepared for something like that affecting sales,” Costa said. “The greatest surprise is just how strong our market is despite all of that — how much people are investing in real estate.”
Cabral said she’d noticed more first-time home buyers stepping into the game. With median home prices also increasing across the board and interest rates remaining low, monthly mortgage payments are in many cases “about the same as rent,” she said.
“It’s interesting because when the market was super hot 10 years ago, local folks really had a hard time buying in,” Cabral said. “Even though loans were easier to get, interest rates were higher and that just put out a lot of people.”
It remains challenging for homebuyers to secure a loan, as many restrictions put in place after the recession have not been loosened.
“Right now cash sales are gangbusters,” Costa said. “If you have cash to buy a house, cash is king. But unfortunately, that leaves a lot of people out.”
“Cash buyers are back, the investors, the flippers,” Heinemann said. “It’s all here right now. It’s true for the state in general.”
He said he’d also noticed an increase in investors and buyers from Oahu, with mainland buyers coming from the Pacific Northwest.
“It’s so busy I’m losing sleep, but again, I’m not complaining,” Heinemann said.
A November report from the state Department of Business, Economic Development and Tourism found that Hawaii County had the most mainland buyers in the state between 2008 and 2015. The same report found that Kona was the biggest draw.
Citing statistics from Title Guaranty Escow, Cabral said mainland buyers were coming from California, Texas and Florida.
“We have the return of people buying their second homes, and some of those are coming from other islands to this area. Some are coming from the mainland,” Cabral said. “That happens from time to time, but we pretty much lost (the market) six, seven years ago.”
And demand for Big Island homes looks to remain strong well into the future.
“2016 looks like it will be a good year,” Costa said. “Our economy feels like it’s more robust.”
Home prices are increasing — every district except Puna saw an increase in the median sales price — and Costa said the possibility of interest rates doing the same next year could encourage people still on the fence to invest.
“Demand’s going to continue to increase,” Cabral said. “Interest rates are outside of our control. If they inch up a little bit, it’s not too bad.”
“I think we’re going to see a lot more agents entering the market,” Costa said.
Email Ivy Ashe at iashe@hawaiitribune-herald.com.
