That seems to be the question on everyone’s mind and I have to tell you, it’s been interesting. We are still seeing sales, new listings, and properties going into escrow. What we aren’t seeing are multiple offers prior to listing, Buyers waiving those important and very protective contingencies, and sky-high list prices. Initially, the price reductions we saw on Kauai were limited to properties that were listed too high to begin with. Now we are starting to see price adjustments that indicate Sellers are realizing they had better get in tune with the market we are in NOW, as opposed to last summer.
A couple of weeks ago, it felt as if the market was shifting back to a more normal and sustainable level for Kauai. As you no doubt realize, our Kauai real estate market is very small. So small in fact, that there was simply no way we could have sustained that level of activity over the long term. Kauai just doesn’t have the home inventory after the last few years of aggressive buying activity.
Is it still a Seller's Market on Kauai?
For Sellers, contrary to what you might be hearing, you have not missed the market. Properties are still moving, and inventory is still low on Kauai. Home values are still much higher than 2019. In fact, looking at recent stats, the median home price on Kauai is over 24% higher than it was prior to COVID. Listing now, before prices drop and rates increase further, is a smart choice. The key will be to price your home correctly for today’s market and present your home in its best light. Be prepared to wait a little longer for the right offer. Be sure to evaluate each Buyer carefully, along with their proof of funds or pre-qualification letter.
Is Kauai a Buyer's Market?
The good news for Buyers is the pressure is off for the most part. You may still compete with another Buyer, but it’s unlikely you’ll be competing with 8-10 Buyers. Yes, rates are high. However, with each increase, lenders are rising to the challenge and creating loan products that work for niche groups. For instance, I’ve seen loan programs for physicians recently, and a renewed push toward adjustable-rate mortgages. I’ve also seen a new trend with Sellers contributing toward the cost of buying down the rate.
In closing, I would say if there’s one thing I’ve learned after 13 years in this business, it’s to be flexible, and learn to shift priorities and focus with the constantly changing market. My phone is still ringing. Both Buyers and Sellers have been reaching out now that the shock is wearing off. And hey, if it means I have more time for family and to catch up with all of you, then all the better!
