The Kona real estate market inventory edged up slightly over the past month, as did the number of Pending Sales. In fact, the Pending Sales ratio has shown a strong improving trend since the beginning of 2012.
This increase in demand, and gradually decreasing inventory, is now showing up in the form of increased prices. The data for the Kona residential real estate market continues to show a year over year increase in median price at 4%. This means that the average and median prices in the past 12 months are higher than they were in the same period from 2010 to 2011.
Kona Real Estate Market at a Glance
One of the most interesting trends can be seen in the Kona residential price range up to $400,000. We know from historical statistics that market recoveries start in the bottom price levels, then spread into the upper price levels over time.
This year the price range up to $400,000 level has seen the pending ratio rise with each report. While the $900,000+ price ranges are still a strong and growing Buyer’s market with a substantial supply in inventory, the under $400,000 price range is definitely Seller’s market.
In September 2012 the number of residential units sold in the under $400,000 price range represented a total of 52% of ALL residential sales under $4 Million. Going forward this year, if the market continues on its current path of recovery, the percentage of units sold in the under $400,000 price range will shrink as the higher price ranges begin to represent a larger share of overall sales.
Distressed Properties Inventory Continue Slow Decline
The Big Island trend over the past 12 months shows a steady decline in the percentage of distressed properties with the exception of Waikoloa. In fact, Waikoloa, after showing a significant decline in its total percentage of distressed properties either Active, Pending, or Sold in August 2012, is now showing a dramatic increase in distressed inventory.
Data related to the distressed property market continues to show a modest declining trend in REO’s and Short Sales. REO’s and Short Sales still represent over half of all escrows and 90 day sales in the residential North Kona and Waikoloa Village markets. Waimea, South Hilo and Puna show a stronger declining trend with distressed sales representing approximately 30% of escrows and sales. South Hilo has the least amount of distressed residential properties in the MLS.
While the overall Kona real estate market inventory remains extremely low in the under $400,000 price range, there are some great deals to be found in the $500,000 to $700,000 price range. As well, the $700,000 to $900,000 price range has shown a dramatic upward trend in homes “in escrow” and no longer for sale.
A hui hou!
*Data republished with the courtesy and approval of the Griggs Report.