Hawaii Real Estate Resource


June Real Estate Market Update


June 2011  Market Update

The U.S. housing market continues its gradual and uneven progress, despite the expiration of the home buyer tax credit. The remarkable rebound in housing activities from the initial drop following the end of the home buyer tax credit this past July adds to the belief that the risk of a double-dip downturn in housing may be disappearing. 

As the housing market continues to work through the excess supply overhang, a result from the glut of foreclosed properties which is keeping home prices below their long-term trend growth, economists anticipate mortgage rates at or above 6% by the end of 2012 and expect buying activity to continue its upward momentum. 

Supporting this view is the rising concern about inflationary pressures sparked by political unrest in the Middle East. While surging gas and food prices could prove transitory and pose no major threats, these price increases may weigh down consumer spending, which accounts for two thirds of the economy. While, the Federal Reserve is committed to making necessary policy changes to address such risks. Meanwhile, core price gains, excluding food and fuel, were modest in April, offering some relief to consumers.

As the economy improves, stimulus efforts by the government and the Fed is expected to gradually wind down, which typically spurs rising interest rates to keep inflation in check. Meanwhile, buyers continue to benefit from historically favorable buying conditions and sellers are encouraged by increased market stability.


Home Sales

in millions


The number of homes home sales in April were down 12.9% compared to the same time last year when the impact of the tax credit was at its peak. Sales were relatively stable compared to the previous month: less than a 1% decline. NAR Chief Economist Lawrence Yun states that “given great affordability conditions and job creation, home sales should be stronger” and cites unnecessarily tight credit for limiting sales. Gradual but uneven improvement is expected to continue. In fact, home sales have increased six of the past nine months.




Home Price

in thousands

Home prices rebounded 2.4% in April with median home prices rising to $163,700. This is 5% below the year-ago level and continues to keep the median price close to 2002 levels. Three out of eight homes sold during April, or 37% of sales, were distressed properties, which typically sell at a 10%–20% discount. This is down 3% from March. Investors represented 20% of sales, and all-cash buyers were 31% of sales in April, down from a record high of 35% in March. Prices and mortgage rates remain favorable for buyers for the spring selling season.


Inventory- Month's Supply

in months


The supply of homes measured in months on the market, if sales continue at their current pace, inched up during April compared to March. Inventory levels remained 26% below the peak of 12.5 months in July and only 11% above April of 2010 when the tax credit was in full swing.

Source: National Association of Realtors

Interest Rates

Rates have reached a new record low after steadily declining throughout May, primarily due to uncertainty in the global and domestic economies. Rates are still expected to follow an upward trend as the year progresses. As overall economic activity gets back on track, rates will likely rise to keep inflation in check. This window of opportunity for buyers to lock in these historically low interest rates may not remain open much longer.  


This Month's Video

Topics For Home Owners, Buyers & Sellers

Following in the footsteps of its counterpart Fannie Mae, Freddie Mac is offering a summer sales promotion for buyers who purchase a home from its inventory of foreclosures or HomeSteps properties. Since banks typically sell foreclosures “as-is” without incentives, warranties, or repairs, this incentive could help buyers view a HomePath property more like a traditional sale, and less like a distressed property, during their search process.

For offers received by July 31 that close by September 30, Freddie Mac is offering:

  • 3.5% in closing costs to buyers
  • $1,200 bonus to buyer agents

This is on top of the incentives already being offered:

  • A two year HomeProtect Home Warranty
  • Up to 30% savings on new appliances

Note that this program comes with a few eligibility requirements, which includes the home must be a single-family, owner-occupied, financed dwelling used solely for residential purposes.


Kauai Real Estate Update

Kauai real estate continues to be a good market for buyers and no-so-good for sellers.  There has been a move back towards a balanced market from that of the prior 2 years.  Inventory continues to decline from its peak at the end of 2008 but is still double that at during the market frenzy of 2004 & 2005.

Absorption rates for the different market areas continues to decline with residential housing doing better than condos except in the Lihue zone where condos are actually in the green band signifying a balanced market..  The Lihue condo market is much more heavily weighted to residential than vacation use.  A significant exception to that is Kauai Beach Resort, which has seen such steep price declines that investors have swooped in and paid cash for distressed properties.

Kauai inventory continues to come down...Kauai Real Estate Inventory Chart

Kauai absorption rates are showing less stress than years past...Kauai Real Estate Absorption Rates By Island Zone

Additional Kauai sales information is available upon request. 

Jump to Kauai data

Kauai is the oldest, 4th largest, and furthest north of the Hawaiian islands.  Kauai’s climate is tropical and world-class beaches include Poipu Beach Park and Hanalei Bay, honored as America’s #1 beaches in 2001 & 2009.

Richard Dolbeare is a Kauai real estate agent with Keller Williams Realty, the 2nd largest real estate franchise in the nation and a source of many buyer referrals.

He is the author of Kauai’s #1 real estate blog and is the Localism Community Leader for Poipu.  His Kauai community reviews include videos, descriptions, and sales data popular with buyers searching for homes on the internet. 

Richard is available by phone, text, email, or personal appointment.


Richard T. Dolbeare (RA)

Keller Williams Realty

(808) 651-4550




Living and working on the island of Kauai


Brokerage Contact:

Keller Williams Realty, 1819 S. Kihei Rd., Ste. D-110, Kihei, HI 96753, (808) 270-2900

  JD Powers Award to Keller Williams Realty

Brought to you by KW Research. For additional graphs and details, please see the This Month in Real Estate PowerPoint Report. 
The opinions expressed in This Month in Real Estate are intended to supplement opinions on real estate expressed by local and national media, local real estate agents and other expert sources.  You should not treat any opinion expressed in This Month in Real Estate as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of opinion.  Keller Williams Realty, Inc., does not guarantee and is not responsible for the accuracy or completeness of information, and provides said information without warranties of any kind.  All information presented herein is intended and should be used for educational purposes only.  Nothing herein should be construed as investment advice.  You should always conduct your own research and due diligence and obtain professional advice before making any investment decision.  All investments involve some degree of risk.  Keller Williams Realty, Inc., will not be liable for any loss or damage caused by your reliance on information contained in This Month in Real Estate.

Richard T. Dolbeare, R(B) photo


Richard T. Dolbeare, R(B)

Keller Williams Realty(808) 651-4550


www.MauiSandCastles.com and www.KauaiRocks.com 

 Hawaii multi-island specialist, Maui & Kauai
Richard Dolbeare eBusiness Card

Google+ Twitter icon Facebook logo Youtube logo

Comment balloon 1 commentRichard T. Dolbeare • June 13 2011 12:17AM
June Real Estate Market Update
June 2011 Market Update The U. S. housing market continues its gradual and uneven progress, despite the expiration of the home buyer &… more
May Real Estate Market Update
May 2011 Market Update Gradual and uneven progress in the housing market continues without government support. The market has shown remarkable… more
Kauai News--Kamamalu Buyer Restrictions Removed
Buyer restrictions have been removed for Lihue's affordable housing called Kamamalu. These brand-new, 2 bedroom condominiums are now available to all buyers including investors. This project was an offset to the Kauai Lagoons luxury condos &… more
April Real Estate Market Update
April 2011 Market Update Gradual and uneven progress in the housing market continues without government support. The market has shown remarkable… more
Kauai Real Estate Prices Through 1st Quarter 2011
Charts of historical prices of Kauai real estate suggests that the decline in prices is behind us and that prices are starting a slow recovery. One could debate whether that is the case for Kauai condos which appears to be heading to a double dip… more
Open-Air Home Provides Fresh Breezes
OK, I need help from other Realtors, how would you describe this home in multiple list? Obvious features include weighted roof for good wind resistance, multiple ventilation openings, plenty of roof storage, fenced area for chickens, fresh bananas,… more
Another Princess Arrives in Kauai
It was just last month that I posted a picture of a new ship anchored in Kauai's Nawiliwili Harbor, the Golden Princess (see There's a new gal in town ). Then this month another new ship was in port, the Royal Princess. This one was sharing the… more
Tsunami warning for all Hawaiian islands
A Tsunami warning has been issued for all shores of all the Hawaiian islands. The tsunami is expected to reach Hawaii beginning at 2:59 AM. Kauai will be first up and then the other islands soon after. "Waves" resulting in a 6 foot sea… more
Elton John on Maui
The Elton John was on Maui this past week for his first-ever concert here. As Sir Elton John said, he has been coming to Maui for 40 years but this was his first concert here. What was to have been 1 performance on Friday was expanded to… more
There's a new gal in town
Those of us living on Kauai are accustomed to seeing Pride of America docked in Nawiliwili Harbor once a week during its Kauai stop on its Hawaii cruises. Today I saw a new girl in town and on taking a closer look, saw it was the Golden Princess… more
Kauai Oceanfront Resort
Many of my clients seek an oceanfront property or at least one with an ocean view. This Fannie Mae REO condo meets that criteria with stunning ocean views, delightful tropical grounds, and nearby world-class beaches. The pictures pretty much speak… more
Whale-watching at my open house
I'm sitting an open house today in a condo located just steps from the ocean. What a great place to watch for whales right from the lanai. This is peak whale-watching season and I should spot some soon. Aloha & best wishes… more
Rains End
We've had heavy rains for several days here on Kauai. It stopped today and the clouds seemed to be lifting with a few remnants below the mountain tops. The view is looking north toward Mount Waialeale. Aloha & best wishes… more
Emmalani Court in Princeville
Emmalani Court is a 2-story condominium complex of 1 and 2-bedroom units on Kauai's North Shore in Princeville. There are 42 units in 6 buildings, and those facing the ocean have stunning cliffside ocean views. The units were built… more
Hawaii VOG
A distance of 300 miles and the normal trade winds usually prevent Hawaii's Kilauea volcanic gases from reaching Kauai. But there are instances when the wind patterns shift to what we call a "Kona Wind" which can bring the gases (VOG) to… more
Kauai Real Estate Sales Trends
Kauai real estate sales have increased from the 2009 lows when measured in number of sales. That "fishhook" in 2010 appears to be real and a good sign. Prices are a different story as shown in the other charts. There appears to be an… more
The Makahuena Resort Condo on Kauai in Poipu
Makahuena is an oceanfront resort condominium perched on a rocky coastline of nearly 3 acres at Makahuena Point in Poipu. It has 79 units in 6 buildings, all 3 stories except for the 2-story oceanfront building and a detached unit once… more
Kauai's Hale Malu (Halemalu) at Puhi Update
Updated information for Hale Malu/Halemalu at Puhi Townhouse-style Duplex Homes This attractive community is located on the outskirts of Lihue, Kauai's center of commerce. It consists of 30 buildings in a 2-story, duplex… more
Big Improvement in Kauai Absorption Rate
Kauai's South Shore Poipu area is an area I specialize in and I used to cringe at the awful absorption rate of condos there which rose as high as a 10-year supply. My July post showed a decrease to the 6-year range and now it's down close to 2… more
Queen Emma's Bluffs on Kauai's North Shore in Princeville
Queen Emma's Bluffs is a luxury, gated community in Princeville on Kauai's North Shore. It's an island oasis of 94 homes & homesites completely surrounded by the Prince Golf Course. The golf course views plus a gorgeous backdrop of mountain… more