About Waikoloa's Halii Kai

For the first time in several years, as 2012 begins there is not a single 3-bedroom Halii Kai condo for sale that is a distressed property (short sale or bank-owned "REO" post-foreclosure).

As reported in my October Halii Kai update, the developer is nearly sold out. They actually released their model home of the groundfloor 3bed/2bath Kipuka floorplan as they have nothing left in this floorplan. And there are no short sales without offers in this popular floorplan either! The two least expensive choices are both in Building 17...$500-549,000 asking prices for a furnished condo with rental bookings in place.

View from the lanai of Halii Kai 15H, direct oceanfront privacy for $1,239,000 (MLS 240035)

On the heels of our sale of Halii Kai 15E we listed the same 3 bedroom condo on the other side of the building. Maybe the most private condo at Halii Kai, 15H is on the oceanfront and next to the rock wall separating Halii Kai from the Ke Kailani community at Mauna Lani Resort.

Short sale opportunities: both 2-bedroom floorplans available

If a two-bedroom works for your family-or you are looking primarily for an investment or vacation rental opportunity, there are still four short sale listings at Halii Kai (Disclosure: these are all my listings). One of them is the larger upstairs corner two-bedroom. Halili Kai 11A has ocean view and solid rentals, asking price $695,000.

Halii Kai 12C has the ocean view directly across the signature hole of the golf course towards the cove where the whales frolic in season. As a short sale, the asking price is only $549,000!

The lowest priced Halii Kai condo for sale is 18B, the smaller groundfloor 2 bedroom in the Coconut Grove with a list price of only $350,000! As with all short sales, these are unfurnished prices but in some cases the furniture could be purchased under separate bill of sale.

A hui hou,

Beth

In my previous reports this year on Halii Kai condos for sale, the market has been completely dominated by short sale, foreclosure and developer sales.

There is currently one REO (foreclosure) - Halii Kai 4B - still in escrow with at least two more in the pipeline.

There are currently five short sales at Halii Kai with accepted offers being presented to banks for approval, which as of yesterday would have left only four available. Coincidentally, all of them happen to be the groundfloor 3 bed/2 bath outside unit that is usually the most popular floorplan.

However, today we saw the release of two new resale listings at Halii Kai, both of which are short sales with great ocean view locations on the golf course.

Halii Kai 12C is a 2BR/2BA with a solid rental track record in the building that looks across the signature hole of the Waikoloa Golf Course at the ocean, just next to the Ocean Club Amenities. The sellers paid $1.3 million and the current asking price is $549,000! At 58% off, the numbers look excellent for someone who wants a vacation rental property...or just a little resort pied-a-terre for themselves. (Disclosure: this one is a Hawaii Life listing!)

Halii Kai 9H is also on the groundfloor, and is that popular 3 Bed/3 Bath floorplan with a golf and ocean view. Asking price is $725,000, again a short sale so that price is subject to lender approval, and furnishings would be negotiated separately. I remember the furnishings well and this one is a stunner, only lightly rented.

Sunset from new Halii Kai 2 bedroom short sale

Both of these new Halii Kai short sale listings appear to me to be priced at about where the lender's valuation would fall, and therefore have a strong chance of approval. Some of the other short sales available at Halii Kai appear to be sitting on the market as the asking price is above recently sold comparables.

A hui hou,

Beth

Yesterday's West Hawaii Today had a notice of foreclosure sale for a Halii Kai condo at Waikoloa Beach Resort. The ActiveRain blog post that has brought me more prospective buyers than any other was the announcement of the listing of Halii Kai 16C as a foreclosure--and this notice is for the mirror-image unit next door!

Careful distinctions are in order here. Usually when people ask me about "foreclosures" they are actually interested in what banks and real estate agents refer to as "REOs" or real estate owned by a lender after completion of the foreclosure process. Less commonly, they want to know how to find out about properties up for foreclosure auction, such as this Halii Kai condo.

The Halii Kai condo set for foreclosure is in one of the closest buildings to the private Ocean Club amenities

Under Hawai'i law, there are two avenues for foreclosure. Non-judicial is the more common (that's the equivalent of a sheriff's sale). This notice was for a judicial foreclosure, which follows a slightly different process. In both cases, it is rare for a bidder other than the foreclosing bank to buy the property. In the case of a judicial foreclosure, the sale is subject to court confirmation and as a real estate agent I do not represent buyers in these sales.

I've been tracking this particular Halii Kai condo for many months thinking it should be coming on the market as an REO. I've recently seen with other distressed properties at the Kohala Coast resorts that the companies handling the foreclosures are having a tough time properly serving the owners (since these are second home or investment properties with non-resident owners). When that happens, they cancel the trustee sale and move to a judicial foreclosure.

If you want to preview Halii Kai 16B which is the 2 bed/2 bath condo with a bit of ocean view that's facing foreclosure auction, there will be open houses on the afternoons of May 7th and 14th. The Foreclosure Sale takes place on Tuesday May 24th, but again is subject to court confirmation and you will probably be outbid by the receiver for the mortgagee. In that case it could be many months before the condo is listed as an REO; and if what happened with its neighbor is any indication you might find yourself in a bidding war!

Alternatively, there are short sale opportunities at Halii Kai in the $500,000 range that would have you enjoying your new Halii Kai condo and sunsets at the Ocean Club long before this foreclosure finds it way back on market.

A hui hou

Beth

Even the buyer of foreclosure Halii Kai 24C (MLS 242791) can walk down to the Ocean Club for sunset

At the beginning of January I wrote a review of Halii Kai condo short sale and foreclosure activity and although this is titled February update, I have to confess that 7 weeks have passed. Since my previous post, all of the action has been in short sales, REOs, and DEVELOPER inventory, hence the revised title of this post. The activity over the past couple of weeks contains a few surprises.

SOLD SURPRISE

There was only one closed sale during this time period, one of the REOs. I was surprised both by which one of the three REOs for sale went first, as well as by the amount of discount to the asking price (typically when banks list property they only accept offers close to asking price, then gradually reduce that price until it sells).

The three REOs (bank owned, post foreclosure) were all the same 1082 sq ft, 2 bed/2bath floorplan. The lowest price of the three, garden-view 24C, came on the market at $338,000 which seemed like a compelling discount to the developer's close out of 21C in September for $395,000.

Both 2C and 4B are on the golf course, and both are the rare units of this floorplan with a garage rather than a carport. With 2C listed at $394,900 and 4B listed at $414,800, I would have predicted 24C to go first, forcing both 2C and 4B down in price.

Instead, 2C closed escrow this week for $340,000 (following an intermediate price reduction to $374,900)!

The asking prices are now $319,000 for 24C and $394,319 for 4B. So watch for a big adjustment on 4B and an offer below asking on 24C. Even the developer agents concede that these are prices with which they will not compete, at least not directly.

UNSOLD SURPRISE

While two short sale listings accepted offers since my last report, there are still four short sales available. Curiously, the all are the 3 bed/2 bath floorplan which in some years has been the best-selling unit. I think they haven't sold yet because 3 out of 4 are still in a rental pool and therefore not often available to show:

Here's the run down on those deals:

18H - the lowest priced at $409,000, was supposed to go to auction. It has been twice delayed on technicalities, but this is my listing and a smaller bank whose negotiator is very direct with me. For them to look at a short sale this late in the game, it would have to be a cash offer, and the buyer would have to agree to settle delinquent HOA monthly dues (which with attorney's fees could be $30K or more). Still, with the lowest sale to date at $445,000 for this floorplan, an investor could end up with a sweet rental next to the tennis courts.

6E - now a short sale at $525,000. Only a peek a boo ocean view from the lanai, but a well maintained unit and if it is being rented, that means it is current on dues.

12E and 12H are both short sales offered for just under $1 million. I personally think these are the screaming deals at Halii Kai, although I think the comps suggest that the savvy buyer should offer well below the $999,000 asking price. Many people prefer building 12, which other than the three oceanfront buildings is the closest to the water, to the oceanfront buildings. Oceanfront gives a stark lava-and-ocean view, which is softened by the golf course fronting building 12.

My reference point for the upside potential of these units is still Mauna Lani Point and Mauna Lani Terrace, which are similar close to the ocean (and with the private Halii Kai Ocean Club substituting for the Mauna Lani Beach Club if you want a bite to eat while you enjoy the view). A beatifully furnished 2 bedroom 1481 sq ft Mauna Lani Terrace condo closed escrow today for $1,600,000...

A hui hou

Beth