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Kona Gold and Maui Wowie

Neighbor Island Real Estate is High

It used to be that the top-dollar luxury estates were all on Oahu. That was your mother’s mansion. These days those in the real estate industry have noticed that oceanfront homes and lots on Maui and the Big Island will fetch millions more than comparable properties on the gathering place.

“You can build a case and say, yeah, the Neighbor Islands are hot because those kinds of experiences are appreciated by people who come from the West Coast,” says Ricky Cassiday, research director for Prudential Locations. Cassiday says those in the business hear about the sales and run across them.

Resale numbers from the Multiple Listing Service (MLS) tell an interesting story. The island of Maui has the highest average price per property. Last year 149 properties were resold on Oahu for an average price of $1.2 million. Twenty-five properties were resold on Maui for an average price of more than $3 million and 31 properties were resold on the Big Island for almost $1.4 million in average price.

Million Dollar Maui: Some of the pricey real estate for sale.

Kona’s gold coast may end up being the big winner this year. Cassiday says the Kukio development project there, just south of Hualalai, sold a parcel of a little less than an acre for $12 million in April. Four other lots sold there have ranged in price from $4 million to $10.5 million.

Bob Cella, owner of Coldwell Banker Island Properties, believes that Maui has also been gaining momentum over the years. “I think it’s something like follow the leader. A lot of people are coming to Maui because their friends are coming. If I sell one property then I’ll sell three,” Cella says. He notes that friends who sell on Oahu are not experiencing the strong oceanfront sales, and Oahu seems to be a little behind the curve.

Says Cella, “My oceanfront client wouldn’t buy on any other island. They are repeat players to the island.” While Wailea is hot — Cella sold four oceanfront lots there this summer for around $5 million per lot — Makena is building, lending itself to larger estates and more privacy.

The island of Lanai leads in average price for resort properties in 2000 at almost $1.2 million for 20 sales. Maui had the highest volume with 580 sales for an average price of $612,000. The Big Island was second in both volume and price. Some 361 properties were sold there in 2000 for an average price of $988,000. Oahu had just 27 sales for an average price of $251,000.

Prudential Locations’ Cassiday notes that Ko Olina on Oahu is the only area classified as “resort” for MLS purposes, while Maui and the Big Island have multiple resort areas. Says Cassiday, “If you are an off-islander, you go to Maui and say, ‘God I’ve got to live here!’ Well, go to Wailea or Kapalua or Kaanapali. If you come to Oahu and say, ‘God I want to live here!’ they’re not going to say, ‘Go to Ko Olina.’ they’re going to say, ‘Go to Kahala. Go to Lanikai. Go to the North Shore.’ But it’s not going to be a resort area. And they are certainly not going to say to the West Coast people who have the bucks now, ‘Go to Waikiki, you’ll love it.’”

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Hawaii Business,October