West Hawaii Today reports the West Hawaii’s real estate market is booming.

‘Driven by a surge in demand for residential homes, property sales in Kona reached a 15-year high in October and November, marking a significant rebound from a pandemic-induced lull that started in April. Sales are up almost 60% over last year’s combined October-November totals. Condominium sales, however, have not experienced the same type of bounce.

Resort communities along Kona and South Kohala are reporting substantial increase in purchase traffic in Mauna Kea, Mauna Lani, Waikoloa Beach, Hualalai, Kukio, and the new Shores at Kohanaiki have all seen tremendous spikes.

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Cash buyers at closings were at 41% last month. Nationwide, 22% of purchases in the third quarter of 2020 were paid for with cash, according to statistics from ATTOM Data Solutions. For comparison, Kona’s cash sales never exceeded 20% in any of the five years leading up to 2008.

Many locals aren’t stepping forward to sell, either; as of the end of November, inventory for residential homes is approximately half of last year’s total at the same time.

“Inventory is at the lowest level for this date since the stats were first reported,” according to Realtor Michael B. Griggs, who writes the monthly Griggs Report. “Pending sales are strong and probably would be higher if it weren’t for the lack of inventory.”

Such a low inventory is likely a combination of multiple factors, most notably Hawaii Island’s low COVID-19 case count, coupled with the mainland’s surging numbers and recent new lockdowns. This combination lends credibility to the notion that those already in West Hawaii have good incentive to stay, and those looking to relocate from areas more affected by COVID see West Hawaii as an enticing option.

Then, add in historically low interest rates, and it leads to West Hawaii homes getting snatched up quickly. How long this trend can last for is uncertain.

The expiration of federal and state protections for foreclosures and evictions in the coming months, coupled with what’s projected to be a sluggish recovery in Hawaii, could result in an exodus of West Hawaii homeowners heading to the mainland in 2021. Such an exodus seems certain to inflate the current depleted inventory of homes.

West Hawaii Today December 22, 2020

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