Quick Answer: While 2023 saw market adjustments with fewer sales due to higher interest rates and limited inventory, the luxury resort areas of the Kona-Kohala Coast demonstrated resilience, with many maintaining or increasing average sales prices. For discerning buyers and sellers, 2024 presents continued opportunities, particularly in short-term rentable condominiums, but success depends on strategic timing and informed guidance.
Key Takeaways: Navigating the Kona-Kohala Coast Luxury Market in 2024
- Resilient Pricing: Despite fewer transactions, average sales prices largely held steady or increased across most Kona-Kohala Coast luxury resorts.
- Inventory Constraints: Low inventory, especially for single-family homes, continues to shape market dynamics and can create competition for desirable listings.
- Condo Market Strength: Short-term rentable condominiums remained active in 2023, reflecting their appeal for both investment and lifestyle buyers.
- Interest Rate Impact: Rates are not expected to return to historic lows, and buyers should plan for a higher cost of capital than in recent years.
- Strategic Guidance: The current market requires careful pricing, positioning, and negotiation strategies tailored to each property type and resort community.
After nearly two decades selling luxury homes on the Kona-Kohala Coast, one of the most common questions I hear is what current market statistics truly mean for a buyer’s investment or a seller’s timing decision. The answer lies in understanding the nuances behind the numbers rather than reacting to headlines alone.
Will Interest Rates Fall Enough to Make Buying More Affordable in 2024?
Quick Answer: Interest rates may ease slightly in 2024, but they are unlikely to return to the historic lows of 2020–2021.
Buyers considering a luxury second home or vacation rental are closely watching borrowing costs. While modest declines may occur, the ultra-low-rate environment that fueled rapid appreciation is unlikely to return. As a result, buyers should focus on long-term value, rental income potential, and overall financial comfort rather than waiting for significantly lower rates.
For example, a buyer who secured a jumbo loan at 7.25% in late 2023 chose to proceed rather than wait for potential rate drops, prioritizing the rarity and long-term value of a prime oceanfront villa.
How Long Does It Take to Sell a Luxury Home on the Kona-Kohala Coast?
Quick Answer: Days on market increased in 2023, with many luxury properties averaging approximately 100 to 130 days before going under contract.
The rapid, multiple-offer environment of 2021 and early 2022 has moderated. Buyers are conducting more thorough due diligence and negotiating carefully. This shift represents a more balanced and deliberate pace rather than a weakening market. Sellers should prepare for longer marketing periods and ensure strong presentation, pricing, and exposure strategies.
In one recent example, a resort estate took approximately 110 days to secure a contract but ultimately achieved 98% of the asking price through strategic marketing and targeted outreach.
Are Vacation Rental Condominiums Still a Strong Investment?
Quick Answer: Yes. Well-located short-term rentable condominiums continue to demonstrate price stability and income potential.
In Waikoloa Beach Resort, for example, sales volume declined in 2023, but both average and median sales prices increased. This indicates sustained demand for quality units with strong rental histories and desirable amenities. Buyers continue to value properties that offer both lifestyle benefits and revenue potential.
A two-bedroom resort condominium purchased for $1.2 million in 2023 generated more than $110,000 in gross rental income during its first six months, illustrating the income-producing potential of well-positioned properties.
What Does Decreased Sales Volume in the Ultra-Luxury Segment Mean?
Quick Answer: Lower transaction counts in ultra-luxury resorts suggest more selective buying behavior, requiring precise pricing and extended marketing timelines.
In resorts such as Hualalai and Kukio, fewer sales occurred in 2023. However, average and median prices in certain communities remained strong or increased, reflecting continued demand for exceptional properties. Buyers at this level are highly discerning and value-driven, making accurate pricing and high-quality presentation essential.
For example, a luxury estate initially considered for listing at $15 million ultimately sold near $13.2 million after being strategically priced in alignment with current market data, demonstrating the importance of realistic positioning.
What Does Stable Pricing at Mauna Kea Resort Indicate?
Quick Answer: Flat average pricing combined with rising median prices suggests consistent demand for well-maintained, desirable properties.
Although total sales declined in 2023, pricing at Mauna Kea Resort remained stable overall, with median prices increasing. This resilience highlights the enduring appeal of established resort communities with strong amenities and beach access. Sellers who maintain and present their properties well can still achieve strong outcomes.
A recently updated villa listed at $4.2 million sold for $4.15 million after approximately 115 days on market, aligning closely with prevailing average prices.
The Bottom Line: Strategic Positioning Matters
The Kona-Kohala Coast resort market continues to evolve. While transaction volume slowed in 2023, pricing in many communities demonstrated resilience, particularly for high-quality properties and short-term rentable condominiums. Buyers are more deliberate, and sellers must price and present strategically to succeed.
Looking ahead, continued stability in desirable resort communities and sustained demand for income-producing condominiums may define the 2024 market. Careful analysis of each resort, property type, and buyer profile remains essential.
Frequently Asked Questions
What should I ask when interviewing a luxury real estate agent?
Ask about their experience within your specific resort community, their marketing strategy for high-end properties, their network of qualified buyers, and their recent performance metrics such as days on market and list-to-sale price ratios.
Is a second home in Mauna Lani Resort a strong long-term investment?
Recent data showing price growth supports its long-term stability. Established amenities, reputation, and rental demand contribute to sustained value, though property-specific analysis remains important.
How much annual income can a luxury vacation rental generate?
Income varies widely based on size, location, management, and amenities. Ultra-luxury resort properties can generate substantial annual revenue, but detailed projections should be developed for each specific property.
Will vacation rental regulations change in 2024?
Vacation rental regulations are periodically reviewed at both state and county levels. Resort-zoned areas generally have established short-term rental allowances, but staying informed about legislative updates is important.
What are the hidden costs of owning a luxury second home?
Beyond the purchase price, owners should account for property taxes, HOA fees, insurance, maintenance, utilities, and property management expenses if renting the home. Proper financial planning ensures realistic expectations and long-term satisfaction.