Posts: 37
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Joined: Nov 2005
Aloha,
Your research is sound...did you go back far enough to see a couple cycles of boom and bust over the last couple decades?
This has been a bigger boom in raw numbers than the previous one, to be sure.
Hard to tell how busted the bust will be or how long coming, as there's more of what my debt-broker uncle calls "stupid money" floating around, and a fair bit of it has come here in the past several years.
I can tell you empirically that HPP at least is well overbuilt with spec homes. They're not moving and prices will have to start dropping. Hasn't been an unbuilt lot closing since January, according to a spam letter from some realtor wanting to sell my lot for me.
hi ho,
John S.
Posts: 2,314
Threads: 59
Joined: Jun 2003
What you see now is pure economics. Some people who bought low are cashing out. The smart ones, or I should say the ones who don't need the money right now, are staying in for the long run. They expect 50,000 to 75,000 people moving to Puna during the next 15 years. The current prices will seem like bargain in a short period of time IMHO. Land in Puna has been vastly undervalued in the past.
Aloha,
John S. Rabi, ABR,CM,CRB,FHS,PB,RB
http://www.JohnRabi.com
Typically Tropical Properties
75-5870 Walua Road, Suite 101
Kailua-Kona, HI 96740
(808)327-3185
Posts: 4,533
Threads: 241
Joined: Jan 2006
50k to 70K???? Quick, someone help me close the gate!! ha ha
-Cat
Posts: 2,149
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Joined: Feb 2006
John, as a realtor, what do you think is the relationship between California markets and the local one? I have a theory that as long as people in California (and other overheated mainland markets) find Puna real estate comparatively cheap and feel weathy due to equity, they will keep buying. That will make local prices higher than they might otherwise have been. If those markets drop, what will happen here?
BTW, my interest is academic and esoteric. I bought my home to live in, and don't see it as an income producing investment. I have posted before on the destructive effect of speculation on local people trying to buy a first home. Hopefully, some of them may be able to take advantage of the recent softening of the market.
Aloha,
Jerry
Posts: 1,727
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It wasn't the mainland economy that had anything to do with Big Island house prices in the late nineties, it was sugar leaving. Sugar left the same year there were massive welfare cutbacks and Hilo lost about 40% of it's economic base. So, 40% of the people left. You couldn't GIVE houses away after sugar left. The prices of houses were peanuts and when folks tried to buy houses afterwards, the comparables came in so low they weren't worth selling even if you could find a buyer.
Hawaii real estate seems to run on a seven year cycle. Check and see if that fits.
"I like yard sales," he said. "All true survivalists like yard sales."
Kurt Wilson
Posts: 4,533
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I think the mainland economy has something to do with it. When I first moved here, the gulf war started about 1 year later, sugar did die out, the japanese started pulling out of the BI real estate market, there were more factors than just sugar. Sugar did affect the Hilo side very hard but Nansay filing bankruptcy hurt the Kohala Coast almost as hard. Does anyone remember the days when you could buy a house in Waikola for $150K (1990) and we all thought that was the BIG bucks!! ha ha
Posts: 2,149
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Joined: Feb 2006
Of course people move here from California (and other places) because it IS Hawaii. Comparatively cheaper land prices just make it easier! 
Aloha,
Jerry
Posts: 23
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Joined: Apr 2006
Jerry is right, their are selected markets on the mainland that won't be slowing down for at least another 2 years. Here in Seattle, their is no more room to build new houses, so newbies moving here have to go to the burbs and look for homes. Can you say CHA CHING....... Our 1500 sf. home has gone up $110,000 in three years. We paid $250,000 so the percent gain is quite comforting.
We plan on moving to Hawaii BECAUSE it is Hawaii,not just because the prices seem cheap(er). It's all about timing, and in our case timing is good.
Erik
Posts: 129
Threads: 16
Joined: Apr 2006
I found alot of the historical data at the UHH. The info is hard to find, no real analysis of data, part of the problem I am having is that the getting current data. Buying a house, a stock, a car or anything you lay money out for required analysis. Why you may like what you are getting, you are crazy if you research and understand the market you are working in. One reason I got out to the stock market in 1999 was all the crazy news programs about grandmother/bowl league/high school investing clubs.
John R.: Can you give me an idea of the financing home buyers are taking on homes?
Thanks
Jared
Posts: 2,314
Threads: 59
Joined: Jun 2003
Jared, it's scary to see all these "creative" mortgages like interest only, 3-2-1, ARM, etc., lenders are offering. Some people will get burned and some people will get burned bad. However, I never look at the value of my primary residence since it doesn't matter how much it is worth, I have to live somewhere. I don't look at real estate investments in a time frame either. Real estate values go up on the long run and you can lose money only if you have to sell within a certain time frame. I remember when the Alii Lani condos in Kona were $99K and they are $370K now. I already saw the SAME condos on Oahu for $800K. Alii Lani will be $800K too, it's just a question of time.
Aloha,
John S. Rabi, ABR,CM,CRB,FHS,PB,RB
http://www.JohnRabi.com
Typically Tropical Properties
75-5870 Walua Road, Suite 101
Kailua-Kona, HI 96740
(808)327-3185
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