Home prices drop

By PETER SUR

Tribune-Herald staff writer

Median home prices fell across the island in 2011 to their lowest level in years.

Data compiled by the Hawaii Information Service show that the median sale price of a Big Island home fell by 4.9 percent to $242,500 in 2011, compared with the previous year.

But that number varies by district, with median prices ranging from a high in North Kohala of $470,050 to a low of $119,000 in Ka’u.

Overall, the trend toward falling prices continued in all districts except for South Kona, where the median sales price increased by 20 percent over 2010.

The upshot of those falling prices is the jump in the number of houses sold and the sales volume, which increased in every district except Hilo and Puna.

“2011 is better than 2010 for the most part,” said Julie Hugo, immediate past president of the Hawaii Island Board of Realtors. “Prices have stabilized for the most part,” but she’s not sure whether the market has hit the bottom.

Real estate agents have been most active in North Kona, selling 416 homes for a total value of more than $326 million, and in Puna, where 502 homes have been sold for about $81 million.

Asked why Puna sales have been so brisk, Hugo replied, “Look at the average price.”

Indeed, the median sale price of a Puna home has plummeted to $140,000, the same level that it was in July 2004 and half of what it was in November 2005.

Hugo cautioned prospective buyers and sellers not to be spooked by the median price of any particular district, though.

“There are pocket neighborhoods in each of the nine districts that might be doing better than the district,” she said.

Overall, 1,616 homes were sold for a total sales volume of $665.4 million.

“To me, when I look for (signs of) renewal, I know that I and others look very closely at Volcano,” Hugo said.

There’s plenty of interest in West Hawaii in rentals.

“We actually don’t have any rentals right now,” said Peggy Yuan of Lava Rock Realty, which serves the Waimea and Waikoloa market. She said the surging interest in rentals is either because of continued uncertainty about the economy or because those who are renting were recently involved in foreclosures.

But for those who have decided to buy a home, prices have stabilized, she said.

Homes priced at $350,000 and below are selling like “hot cakes,” and those $250,000 and below are getting multiple offers within the first week.

Above $400,000, “it’s a very hard sell right now,” although there are still people who buy the high-end properties.

“Our clients are predominantly local people,” Yuan said. “They’re buying their first home because it’s affordable.”

Email Peter Sur at psur@hawaiitribune-herald.com.