Resort homes sizzle
Hawaii's resort-home market enjoyed another year of brisk sales in 2003 thanks to West Coast buyers' ongoing love affair with Neighbor Island resort properties.
A study by real estate analyst Ricky Cassiday of Data@Work said the number of homes sold in master-planned resort communities last year is projected to have risen 19.7 percent from the previous year to 2,029. That's a 79 percent gain from the year 2001, when the market contracted after Sept. 11.
Rising up
Last year's resort home sales beat the pace in 2002, according to projections:
Resort homes sold: 2,029
Percent rise from '02: 19.7%
Total sales: $1.5 billion
Source: Data@Work
"That may come in even higher because I've seen some of the fourth-quarter numbers and they're really high," Cassiday said.
The study used data from the first nine months of the year and extrapolated to arrive at a full-year 2003 estimate.
Cassiday said 60 to 70 percent of the buyers are from the West Coast, mainly well-heeled Californians looking for a combination vacation home and investment property.
"These resort homes are seen as a good investments generally, but buyers also know they can rent them out at high rates," Cassiday said. "It's a strong market now."
Average sales prices are projected to have dipped for the second straight year to $738,697, a decline of 1.7 percent. Prices had dropped 15 percent in 2002 in the aftermath of the Sept. 11 attacks.
However, Cassiday said prices were skewed by the fact that many newer resort homes in areas such as Wailea on Maui are being built further from the shore -- and consequently at more modest prices -- since prime beachfront sites are already developed. He added that even with the lower sales prices, total revenues from sales statewide probably grew 23.6 percent to $1.5 billion in 2003.
Developers such as Brookfield Homes Hawaii Inc. are banking that the good times will keep rolling. The company just last weekend put up for sale the last 13 units of its 270-home Coconut Plantations community at Ko Olina and is looking for other land to develop, said Brookfield's development director David Murphy.
"With the way the market has been going and interest rates being so low, things could remain strong for awhile," he said.
Of the four major islands, Maui remained the favorite among resort-home buyers, followed by Kauai and the Big Island. Oahu was a distant fourth, though sales on the island grew 21 percent.
The number of homes sold grew on each island except Maui, where sales dipped slightly. Average sales prices also grew strongly across the board, except on the Big Island, where they fell 34 percent to an average $1 million, still highest in the state.
Condominiums, viewed as easier to maintain and rent out, led the sales growth with 26 percent more units sold last year, followed by single-family homes with a 21 percent increase. Average prices were up 3 percent for condos to $572,902, and up 8.7 percent for single-family homes to $1.2 million.
