An aerial shot of the future site of Makali’i at Wailea
Hawaii’s resort real estate market picked up steam in 2017, with overall sales increasing by 14 percent, compared to last year, and average prices increasing by 2.6 percent with resales of condominiums leading the growth, according to a resort residential market report by consultant Ricky Cassiday.
Cassiday sees the momentum continuing into 2018 and forecasts that sales and prices will accelerate due to global economic activity, the stabilization of China’s economy, low commodity prices and the effects of the U.S. tax cuts.
Cassiday told Pacific Business News that the data shows that the Hawaii resort market was starting to accelerate before Congress passed the tax package.
“This is a nice market, it’s starting to climb up the foothills,” he said. “Now with this, it will get more steam and take off.”
Overall sales in 2017 rose to 1,512 single-family homes, condos and homesites sold, with fourth-quarter numbers extrapolated from the year-to-date numbers from the first three quarters of this year.
That was a 13.9 percent increase from 1,328 sales in 2016. The average price rose 2.6 percent to $1.34 million, from $1.31 million in 2016.
The biggest driver of growth in 2017 was condo sales, and resales in particular, Cassiday found.
Condo sales in Hawaii increased by 16.2 percent to 1,011 units sold in 2017, compared to 870 units sold in 2016. The average price of those units rose by 7 percent to $1.06 million, from $989,362 in 2016.
Cassiday noted that there were fewer developer sales of resort condominiums in 2017, but resales made up for that decline with an increase of 25 percent to 944 units sold, from 755 units sold in 2016. The average price of those units rose by 10.6 percent to $975,918, from $882,440 in 2016.
Cassiday said it will be interesting to see how the tax cuts will affect sales of resort condos this year.
“It will be interesting how far down the price spectrum it expands,” he said. “If you’re a mid size company or even a small one, and you’re the owner, maybe you’ll buy a condo in Waikiki, maybe you’ll buy one in Ko Olina, or the North Shore.”