Big Isle home prices fall 14%

Prices continue rising on Maui and Kauai even as overall sales volume plunges

Median home prices were higher in August than a year ago on Maui and Kauai, but not on the Big Island, which saw a 14 percent price drop. The number of sales of previously owned homes dropped on all three islands, according to statistics released yesterday by Hawaii Information Service and the Realtors Association of Maui.

On the Big Island, the median sales price for single-family homes in August was $370,000, down from $429,500 in August 2005. The median condo price on the Big Island went up to $401,450, compared to $394,950 a year ago.

On all the neighbor islands, much like Oahu, the pace of home sales declined dramatically, reflecting a deceleration in the market during August.

Home sales were notably lower in the high-end resort areas of North and South Kohala. Only 11 homes were sold in South Kohala, compared to 29 in August 2005.

"Whether the market turns, whether up or down, resort areas are always the ones to feel it first," said Dana Kenny, broker in charge of Hawaiian Island Homes in Hilo. "The market has slowed here, and you're seeing some price adjustment. But I don't believe we're looking at a market-turn type of situation as much as a correction."

Values went up tremendously in the last three years, according to Kenny, while interest rates are going up.

But Kenny said he still sees strong interest from mainland buyers.

"Hawaii is still a very popular choice from these baby boomers who are looking for a quality-of-life change," he said. "We're nowhere near the price structure where they'll say it's too expensive."

On Maui, the median home price was at $749,000 in August compared to $670,000 in August 2005, according to the Realtors Association of Maui. The Maui median price was a drop from the record high of $780,000 in July, which matched its all-time high of May 2005.

On Kauai, the median home price went up to $740,000 in August compared to $644,500 in August 2005.