Now is the perfect time to invest in Kauai real estate. To some degree sales prices are less than they have been in preceding years; however, this is actually not bad news. In the past few years the Kauai real estate market experienced a surge of mainland interest that had not been seen in quite some time. Much of that interest was attributed to the 9-11 disasters after which time many people seemed to consider Hawaii as being a safer option to reside than many metropolitan areas. While that interest now seems to have leveled off this in no way indicates a shortage of buyers of Kauai real estate.
In fact, there are still numerous buyers coming to Hawaii looking for either a residential home or vacation home. While property sales on neighboring islands, including Big Island and Maui, have been practically cut in half the market data for Kauai remains strong. Compared to last year the Kauai real estate prices have risen between 25% and 30%. Given the fact there remains a surplus of buyers and a shortage of homes, this spells good news for investors. Combined with interest rates that are still relatively low and an unpredictable stock market, Kauai real estate gives investors a sound opportunity to diversify their portfolio.
Investors are not the only buyers looking at Kauai real estate and recognizing the number of opportunities here. Individuals looking for the ideal place to retire are also numbering among Kauai real estate buyers and for very good reason. Baby Boomers,” in particular, have proven to be a large contributing factor in the continued interest in Kauai real estate. In fact, many brokers have revealed that Baby Boomers may have the single largest impact on the Kauai real estate market than any other potential buyer. As studies of this highly profiled group have revealed, Baby Boomers tend to have more disposable income than any prior generation of retirees. In addition, more than any other retiring generation, Baby Boomers have an increased tendency to purchase both vacation and second homes.
As we know a large segment of Baby Boomers will begin retiring in the next year as they reach retirement age and/or retire early due to sound investment practices. This trend will continue throughout the next decade while more and more Baby Boomers experience a shift of wealth from their parents through inheritances. As this begins to occur this group of financially sound retirees will be looking for warm locales to retire in comfort. Kauai offers the perfect setting.
While Baby Boomers are anticipated to have the largest impact on the real estate market in the United States than we have seen to date, there are also other groups that will play a meaningful role in the future real estate market on Kauai, particularly persons looking to purchase vacation homes.
While the interest in warm tropical locales has not necessarily waned, the interest in purchasing vacation real estate in foreign countries is definitely not as strong as it once was. People are growing tired of flying foreign airlines, especially as they grow older, and the threat posed by neighboring countries experiencing civil unrest has not gone unnoticed. Given the fact that flying into foreign countries all too often means having to deal with the hassle of currency exchange, foreign language issues and health concerns posed by unsafe water and food, persons interested in purchasing vacation homes are looking closer to home.
Kauai real estate presents an attractive alternative with fresher air and less pollutants in addition to the absence of hassles associated with visiting and purchasing real estate in foreign countries. Individuals looking for a more relaxed way of life delight in the fact that there are no high-rise buildings on Kauai and the continual ocean breezes and low population (only 90,000) prohibit smog. These are concerns that investors and individuals looking to buy retirement and vacation property won’t have to worry about in the future, either. Much of the island simply cannot be developed and regulations stipulate that no buildings can be more than four stories. This means there are only a limited number of properties available for private use on Kauai.
With sales leveling off to a more realistic number, buyers are in a better negotiating position while sellers can rest assured that interest in Kauai real estate will remain strong due to the continued increase in population and no new tropical development in the U.S. When all factors are taken into consideration, the time to invest in Kauai real estate couldn’t be better.