Kona Kohala Blog

There's been so much said about our current financial situation, all negative, that maybe it's time for a comment on the positives coming out of this.  Then we can get back to the complaining.

There are some great buys in the stock market right now.  Most people believe that at some time down the road we will pull out of this mess we're in.  If you're one of them then perhaps you should be looking at good, solid companies that are taking the necessary measures to adapt to the times.  These are the companies that will weather this financial storm and come out strong once it passes.  Since most everyone is taking a beating you may find some good prices on strong companies, prices like we haven't seen since the 80's.

Peope are shopping wisely.  For many of us boomers, we remember when Mom used to cut out coupons or look for sale items before whipping out the credit card . . . wait, there was no credit card.  If we didn't have the money for it, we didn't buy it.  We're seeing that again along with less "stuff" being bought then forgotten about a week later.  Instead of being a society of instant gratification we're going back to appreciating what we have and making it last longer.  When we do get something new, it too is appreciated because it isn't something that happens everyday.  Kids are learning the value of money again and seeing their parents budget.

I think as more businesses compete for the consumer dollar we are getting better service.  Almost all wildly successful businesses in the past, those that have been around for a hundred years or even fifty, for that matter, were built on a service model that we haven't seen in the last 3 or 4 decades.   Businesses are realizing that providing good service is the way to have customers return for more.  Service is what drives capitalism and capitalism is what made the United States the model country that even those who hate us admire.  I don't see people waiting to get into Iran or Mexico or China or even the new Russia.

Last, real estate has returned to reasonable prices, prices that first time home buyers can again afford.  The banks are still over reacting to the laxity of the recent past but as they loosen their lending requirements, we'll see more qualified people be able to own their first home.  Interest rates are under 5% for a 30 year fixed rate mortgage.  We see lending rates that haven't been around since World War II days, that's the late 1940's for you history challenged Gen X, Gen Y and others.

Speaking of real estate; if you're looking for a second home or one you can use to generate rental income, let's talk.  As mentioned earlier, I've been working with clients looking for homes in the one to two million dollar range.  Two very nice homes we looked at are being used as vacation rental properties.  Most people looking for an investment property know it's difficult to find a condo in Kona that will break even let along show a profit.  In the higher price range, I showed two properties that were generating over $100,000 per year and both were ahead of last years income for 2009.

This may be the time to think about a $1,000,000 home if you haven't before.  Now is the time to get one for a lot less than you could have a few years ago and a lot less than what they may be a few years from now.  These are beautiful well kept homes with incredible views and amenities.  On top of that, interest rates for Jumbo loans are in the 6% range right now, also unheard of for a long, long time.

You tell me what you're looking for and I'll find.  The selection has never been better so don't keep putting it off.  If you're qualified and it's in your budget there's no time like now.  aloha