Last month, Hawai'i Life released its Q4/End of Year 2024 Market Report, and as I analyzed the numbers, one thing became clear: the best cure for high prices is high prices. Though mixed in 2024, the market is undeniably normalizing, becoming healthier, and, as the report states, "trends point to a stronger market in 2025."
Several trends caught my attention, which I will discuss in detail. However, one trend remains consistent regardless of market fluctuations. Curious to know what it is? Read to the end of my commentary to find out!
Report Highlights
Current inventory is up 13.9% YoY.
Sold listings are up 3.2% YoY.
The median sold price is up 7.7% YoY.
The price per square foot is up 15% YoY.
Download a full copy of the report here:
Residential 3m+ Luxury Market Overview
The Big Island luxury market shows strong demand despite limited inventory and rising prices.
"Hawai'i Island's $3M+ luxury market is unique, largely situated on one side of the island. Despite a rise in inventory from 2023, there is a marked increase in pending and sold listings of luxury homes. This signals a healthy market despite the small dip we're seeing in the median sold price versus last year."
Although the median sold price declined, the significant increase in sales volume (a whopping 67.3%!) suggests buyers are still interested in high-end properties. However, the rise in DOM indicates that sellers need to price their properties correctly to sell faster.
Residential Submarket Snapshot
The residential submarket (under $3M) displayed an increase in all key categories, reinforcing the idea that the market is stabilizing.
These numbers indicate a normalization of the market. The rise in inventory and DOM suggests that while demand is strong, buyers are becoming more selective and price-sensitive.
Residential Market Snapshot
After a period of correction, growth returned to Hawai'i Island in 2024, and trends point to a stronger market in 2025.
"The Big Island's 2024 market showed mixed signals. Median sold price increased slightly, reaching $544,000. Inventory rose across the board, suggesting a shift towards a more balanced market."
I observed an interesting pricing trend: while both the median sold price and the average price per square foot were higher than the previous year, they were lower compared to the prior quarter (Q3 2024). At the same time, inventory levels, days on the market, and months of inventory all increased. In my view, this indicates that the market is not yet fully balanced, and prices may need to adjust downward to better align with actual demand.
Residential Market Overview
Median Sold Price
"Median sold price saw a lift mid-year followed by a slight decline ending out the year. Despite this, the median sold price for single-family homes is higher than a year ago. We also need to keep in mind that home prices vary greatly across the island."
Average Price Per Square Foot
"Price per square foot (ppsf) is up a good bit over this time last year. Buyers seemed to favor move-in ready homes during the last year, which could have had an impact on ppsf."
Inventory
"There is more inventory on the Big Island in 2024 versus this time in 2023. Meanwhile, pending and sold listings are seeing a lift, signs of a healthy market. For the most part, inventory increased throughout the year, with a high in the fourth quarter."
Days on Market
"Homes are spending longer Days on Market (DOM) than a year ago. Since sales are up over last year, we might infer that DOM is a factor of incorrect pricing, where homes that aren't priced right for the market, tend to stay on the market longer."
Months of Inventory
"Months of inventory is higher YTD. In the last couple of years, we hit a low point for months of inventory around Q2 2023 and that number has slightly increased over the last year and a half."
10 Year History
"A lot has happened on the Big Island over the last 10 years. The median sold price is up 72.7%, and ppsf has more than doubled. Inventory has significantly dropped from where it was a decade ago, while at the same time pending and sold listings have seen a modest lift."
Sales by Property Type
The same trends from previous quarters persist: condo and land sales are down, while home sales are slightly up.
Rising HOA fees and regulations are making condos less attractive. Land sales are slowing due to high construction costs, labor shortages, and Hawaii-specific regulatory hurdles. Additionally, many landowners have been slow to adjust prices to match market conditions.
Looking Forward
Big Island's 2025 market shows growth potential, with strategic pricing and move-in ready homes as key factors.
"Looking forward to 2025, the Big Island market is poised for measured growth. This will be counterbalanced with the need for correct pricing to offset factors across the island's differing markets. As inventory grows, it makes sense that buyers will continue to favor move-in ready homes."
Buyers will continue to favor move-in-ready homes. In Hawai'i, this often means fully furnished homes with minimal repairs needed.
Correct pricing remains critical. Sellers who price appropriately will have a greater chance of selling quickly and at a strong price.
What do I make out of this data?
As I mentioned earlier, the market is becoming more stable and healthy. From my experience working with real estate clients, I can confidently say that any property will sell if priced correctly. The market ultimately determines a property's true value—what buyers are willing to pay for it. While we continue to see price reductions here and there, the numbers clearly show that sellers are adjusting.
Another key takeaway for sellers is that buyers still prefer move-in ready homes. In Hawaii, this typically means a home that is not only in excellent condition with no necessary repairs but also fully furnished with everything needed for immediate occupancy. If you're considering selling your home, consider whether it meets this standard before listing. Ensuring your property is move-in ready can help secure a faster sale and potentially a higher selling price.
Finally, one thing remains constant despite market fluctuations. Can you guess what it is? The 10-year sales history for the Big Island of Hawaii consistently tells a positive story. Over the past decade, the median sold price has increased by 72.7%, and the price per square foot has more than doubled. Since 2014, the trend has been steadily upward, regardless of economic shifts. This reinforces the idea that investing in Hawaii real estate has historically yielded strong returns. Of course, past performance doesn't guarantee future results, but based on today's data, Big Island real estate continues to be a solid long-term investment.
I will keep you updated on the latest trends in the Big Island real estate market. If you're considering buying or selling a home in Hawaii and need expert guidance, please contact me.
Download the full report below.
Ta Da!
Aloha,
Jan
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