Kona Kohala Blog

We're nearing the bottom of our real estate market in west Hawaii.  It's been over 3 years now, prices have come down quite a bit, interest rates are at historic lows and there's a very large inventory to choose from. 

As far as the economy is going, the administration is pretty much going all out to pump imaginary money into the economy through numerous means, most of which are helping the very wealthy, the unions or the very poor, more on that later.  For now, suffice it to say that there's a lot of money flowing into our economy that can't help but stimulate something.  The money has been created out of thin air and will the recovery be but a recovery none the less, just one we're going to pay for big time in the not too distant future.

That being said, the market is near the bottom and will begin to turn around within a year.  Before the turnaround takes place there will be a leveling off which, I believe, is what we're seeing now.  Here are three best buys for condominiums, two in South Kohala and one in North Kona.  My opinion is that when the market starts to turn and prices begin to recover, it's going to be the nicer, newer condos that recover their prices first and that's where we're going to see the greatest appreciation, in my opinion.

The first condo is in Golf Villas.  This is a newer complex located in the Mauna Lani Resort.  I just sold one of these and am familiar with the units and know what to look for.  The condos are roomy with nice golf course and mountain views.  Higher end fixtures and amenities are used in the units and as an owner, you have membership in the Mauna Lani Advantage Program.  This gives you a number of discounts including half price golf and use of the beach club.  There is a short sale in there listed at $399K, a 2/2 with 1,460 sq ft of living space and was built in 2005.

Next is Hali'i Kai.  This is one of my personal favorites and is located right on the ocean, the complex not this unit.  The private beach club sits right above the water with a free form lava rock looking pool complete with spa and water falls.  In the club house is a beautiful restaurant with it's own chef.  The units are very well done, large and comfortable.  The best buy here is listed at $425K, has 2 bedrooms and 2 baths and 1,082 sq ft of living area.  This property is between the Hilton and Mauna Lani.

The last best buy is in North Kona at Sea Scape.  This is also a 2/2 with just over a thousand square feet of living space and is listed at $248,500.  This is not a well known complex originally being built as a lower income project.  The builder went ahead and used nice finishes and a very comfortable floor plan.  This one was built in 2007 and the maintenance fees are very doable, at least for now.

For information on any of these units please call 808-896-0661 or email me.  I'm an Accredited Buyer's Representative and can assist you with any property in west Hawaii.

A brief comment on the Spread the Wealth programs being created by our president.  He talks about tax reduction for the lower income classes but that's not what's happening.  Instead, he's using the tax code to create more debt for the country.

Stimulus bill HR-1, the American Recovery & Reinvestment Act of 2009 created the "refundable" Making Work Pay Credit and increased and made "refundable" the Hope Scholarship Credit, now called the American Opportunity Education Credit.  This administration just loves these titles and probably has a whole department that does nothing but create these names; maybe people that used to work in the greeting card industry.

He's also increased the two largest "refundable" credits, the Earned Income Tax Credit (EITC) and the Child Tax Credit.

"Refundable" really means spending program.  "Refundable" credit means that low income tax payers whose tax liability is less than the credit value get checks from the IRS for the difference.  Let's say their tax liability is $2,000 and they get a "refundable" credit of $5,000, the IRS sends them a check for $3,000.

Increased government spending does NOT increase economic growth.  In order to get that $3,000 that money has to come from somewhere either taxes or borrowing.  There is no new spending power, no new creation of wealth just a redistribution of wealth.

These types of programs are not stimulating the economy.  They aren't putting people back to work or encouraging entrepreneurs to start new businesses.  It's just another spending program and you can not spend your way out of debt.