There’s just so much to write about this November that I couldn’t choose which topic would be best. So instead, this month I’m going to give you a little bit of this and a little bit of that.
This: Well, thank God the election season is over. Not only do we not have to watch any more ads on TV, but the economy can now come off the pause button and move forward. In fact, just like in previous election years as soon as the election was over business started to pick up. One of our homes wasn’t even getting a sniff of an offer and had been on the market for almost 60 days. We got an offer within one week after the election. If you go back to the blog that I wrote in October called “Election Year Real Estate,” you recall that I predicted the market would start to pick up again as soon as the election came to an end. Now that people know who their elected officials are they are more comfortable with moving forward on a purchase. In fact, as I write this, the island is absolutely teaming with people who are here enjoying themselves for the Thanksgiving holiday. I don’t think I’ve seen it quite this busy since 2019 and it’s good to see, given what we’ve all been through.
That: Did you see the Consumer Price Index number? Earlier this month, the consumer price index was released, and it showed a CPI number of 7.7, meaning the inflation rate dropped from 8.2 to 7.7. I think that shocked everybody, including the analysts. Like I mentioned last month, the CPI number is always looking at the previous three months. The consumer price index is not in real time, so I would expect that as we move forward that number of 7.7 will continue to come down. When the market got the news that inflation was starting to abate Wall Street went crazy and stock prices had a nice little run up. In addition, the bond market found the news to be highly favorable. The bond market believes that inflation is starting to come under control, and as such, mortgage rates started to drop. I had clients that had been locked in at 7.4% and the news of the inflation rate at 7.7 caused rates to drop immediately. As I’m writing this, rates are sitting at about 6.6% for a 30-year fixed. I would expect that rates will continue to go lower as we head into 2023. Don’t be surprised if we have rates are hovering around 5% in the March – April timeframe. I don’t want to say that this will trigger a bidding war again, but it just might. I think buyers have a unique opportunity between now and March to purchase a property without having to compete, without having to go well over asking price, and could probably get the house they want for under list. But if rates do get to 5%, then I think the market shifts again and all bets are off.
This: It was announced a couple of weeks ago that Rosewood Hotels is now taking reservations for the new Kona Village Resort. Some of you remember the old Kona Village Resort, that had grass huts right up against the ocean, and gave you a little slice of what old Hawai`i used to be like. That resort got wiped out by a tsunami and has gone through two owners and some litigation. Now it’s been resurrected and transformed into a new posh, high-end resort. How high-end? I’m glad you asked! I checked rates because I thought my wife and I would go down and stay a night or two to check out the hundreds of millions of dollars they spent in renovation. However, the cheapest room I could get was $2,000 a night and the rates go all the way up to $21,000 per night for a four-bedroom Hale. They say they have created 150 stand-alone Hales for the ultimate vacation experience in Hawai`i. For $2,000 a night it better be more than the ultimate experience.
That: On behalf of my business partner, Chris, and I, we hope you had a fantastic Thanksgiving holiday with family and friends, and we pray that you enjoy the upcoming holiday season. If you are coming to the Big Island, we want you to know that Chris and I are working through the holidays. You may be wondering why we mention that? Well, the truth is a lot of agents will call it a day as we get closer to the end of the year and just take off through the holidays. They may be hard to get in touch with, may not be working at all or just don’t want to be bothered during festive season. That’s not Chris and me. We are working straight through the holidays. So, if you are coming to the Hawaiian Islands and you are interested in purchasing property, by all means reach out to us. We would love to hear from you and more importantly we would love to show you around our wonderful island and possibly help you find that Hawaiian dream home.
Mele Kalikimaka and Hauʻoli MakahikiHhou!
Dan Polimino is the owner of the Hawaii Team in Kailua-Kona, Hawai`i. He and his team are the luxury residential experts for the Big Island. If you are thinking about buying or selling in Hawai`i, then please reach out to us at firstname.lastname@example.org or call 808-913-0899