Kamuela, HI

2009 year-end results for Puako Beach, show that neighborhood sales are looking positive! Out of the six properties sold in 2009, 4 were mauka side and 2 on the makai (oceanfront) side of the road. Compared to 2008’s two properties sold - 1 mauka, 1 makai, and 2007's 8 properties - 2 mauka and 6 makai, I would say it looks as if Puako beach has come through the economic crisis intact, and is on the upswing again.

It appears possible we’ve hit the “bottom” of pricing in Puako, at least on the mauka side of the street. The lowest-priced mauka sale since #35 sold in April, 2003 for $499k*, lot #27 went for $500k in May, and comparable sold property prices indicate an increase in value since then. This is good news for the “desirability” of Puako in general.

As for the makai side of the street, two sales hardly indicate a trend, compounded by the fact that they were entirely different sorts of properties. #56, a 972 sqft, 3/2 traditional puako beach cottage was sold by Pattie Freeman of Hawaii Vacation Rentals, for $2,650,000 in May. The second sale was two side by side oceanfront properties lots which sold together for $6.5M in August. The architecturally significant luxury home on lot 20 has a lap pool and gym, while lot #18, next door, was designed to operate as the “yard” for #20.

MLS#218052, asking $2,500,000

Currently on the market for $2.5M is a 751sqft, 1/1 traditional beach cottage which has been making me wonder if we’ve yet seen the “bottom” of pricing on the makai side of the street? On the other hand, oceanfront choices are few and far between in Puako, with only two other homes on the market today, and one oceanfront home offering a "half share" - #10. I currently have three clients who want to buy on the makai side of Puako right now, but nothing available suits their needs. It’s an interesting position to be in during this “buyer’s market.”

To see all the properties currently on the market in Puako Beach, please see the gallery I’ve created: www.puakoproperties.com. Or email me katie@hawaiilife.com and I’ll send you a brochure.

*In the interest of full disclosure, I am the owner of #35 Puako.

Tucked in between the upscale Kohala Coast resorts of Mauna Lani and Mauna Kea, are the cottages, homes and even a few condos of the beachfront community known as Puako. Compared with the hustle and bustle of the Kailua Kona beachfront, Puako feels like an oasis, a step back in time to the Old Hawai'i. The just-renovated Mauna Kea Beach Hotel inaugurated the era of tourism on the pristine Kohala Coast when it opened in 1965, but kama'aina (local) families had been swimming, fishing, and relaxing at their tiny beachfront Puako cottages for decades before.

Puako is the kind of sheltered beach where children, turtles and surfers share the sands.

There is only one two-lane street running the length of the community, with a row of houses on the ocean side, and a row of houses across the street. Near the beginning of Puako is a small market, and next to it is the three-story building with the only condominiums in the community.

Many people first discover Puako when they rent a cottage or stay in a B-and-B there. It is a friendly community, where neighborhood children of full-time residents run between each other's houses, and people walking their dogs stop to exchange news.

What will it cost to own a vacation home or residence in Puako?

That depends on whether you need to be ON the beach, or can settle for being across the street from it!

At the top of my dream home list right now is a property that "unique" does not begin to descibe. Whereas most lots here are 15,000 sq ft, this is a true estate parcel of 1.6 acres with 355 linear feet of oceanfront and 4 anchialine ponds that encourage the native trees shading the 4-bedroom main house and 1-bedroom cottage.

If you want a modern resort-style home, there are other options at Puako in the $6.5 million price range of this historic property. The right buyer for this one is someone who cherishes the history and the simpler unpretentious lifestyle of its day.

On the off-side of the street, there are offers flying on an eccentricly remodeled foreclosure on a half-size lot offered for only $822,800! You'll pay more than twice that for the best house in that side of the street, a classic pole house on a nice lot.

Then we have the Puako condos, of an earlier vintage, but shall we say it again, where as but at Puako can you live across the street from a quiet family beach? Call or email me if you want to hear about a cute 3BR Puako Beach Condo ready for your remodel, offered at only $350,000!

A hui hou!

Beth Thoma Robinson R(S)

Hawaii Life Real Estate Services

Direct: 808-443-4588 Email: beth@hawaiilife.com

I blogged over on AlohaLiving about the recently released NAR survey of second home buyers. Although nationwide the respondents indicated that 30% of them plan to use the second home as their retirement home, in my experience that is true of an even higher percentage of buyers looking at real estate here on the Big Island of Hawaii today. I'm surprised how many people for whom retirement is 10 years out are looking for property today. They are savvy enough to know that the real estate market offers them an opportunity that might not be there closer to their anticipated retirement date.

Some prospective buyers arrive having a clear idea of what they want--perhaps to downsize to a resort condo near a golf course and lots of options for dining out, perhaps to own a coffee farm in a rural area. But many buyers aren't sure at the outset, and other times their ideas and objectives will shift midstream as a result of what they learn during the real estate search process itself.

For example, last year I had buyers who were torn between two houses. They liked the floorplan and swimming pool at one house, but preferred the location of the other. They solved their dilemma by purchasing a lot where they can build the retirement home of their dreams.

This year I worked with buyers who were convinced they wanted the flexibility of a condo, the ability to be able to close the door and travel for extended periods without worrying. But after staying at a resort condo for six weeks, they realized they didn't like having a continual stream of vacationers coming in and out of other condos in the building and generally behaving as people do on vacation. Privacy became a more important factor in their minds. Once they started looking at single family homes, the husband started getting itchy to build. Now they are looking outside the resorts and asking "should we buy or build?"

The simple answer is: it depends.

Here are some of the factors to consider.

1. Acquisition cost. In the luxury and resort areas of the Big Island today, there are high end (meaning $3 million, 10 million and up) homes built on spec or bought for investment at the wrong moment, Some of them can be purchased for less than the cost of construction. In other cases, more modest homes were bought as fixer-uppers, and the market has brought prices down to far less than they have in the home. In these cases, it is clearly cheaper to buy a completed home rather than to build or remodel.

2. Carrying cost. Maintenance and property taxes are signficantly higher on a residence than on raw land. Depending on where the property is located and your own plans for use, it might be possible to rent on either the long-term or vacation rental market, but won't necessarily generate enoughincome to offset the additional carrying costs.

3. If you aren't paying cash, financing options are very different for land versus homes versus condominiums. Most land loans will require that you build and refinance within three years.

4. Where will you live or stay while your home in Hawaii is being built?

5. Do you have the experience and patience to successfully manage the construction of a home, especially if you can't be here to supervise and make the seemingly endless daily decisions your contractor will ask of you?

There are wonderful lots and acreages available in North Kohala (here are some examples) and some houses listed below replacement cost (call or email me for suggestions in your price range).

A hui hou,

Beth

Beth Thoma Robinson R(S)

Cell: 808.443.4588 Email: beth@hawaiipalmproperties.com

Thought for the day: April showers bring May flowers...

The number of Land sales in our N Kohala Real Estate district are down since thier peak in May of 2005. N Kohala is one of 9 Real Estate districts on the Big Island of Hawaii. (Click here to view a map that shows the location of N Kohala on the Big Island of Hawaii). We have been in a downward trending market ever since February 2006. N Kohala has had no Land sales so far in December.

Below is a chart that shows the number of Land Sales in the N Kohala District on the Big Island of Hawaii. The data are over the last 5 years, starting with November 2003 and ending in November 2008. More sales data and info can be found at LocalHawaiiRealEstate.com (Data Source: Big Island MLS)

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John Petrella, REALTOR®
ABR®, GRI, Broker/Owner

Direct: 808.640.3953
Local@LocalHawaiiRealEstate.com

Local Hawaii Real Estate
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Hilo, HI 96720

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