Demand high for Wailea homes
By Andrew Gomes
Advertiser Staff Writer
Much of the pressure pushing Hawai'i home prices higher is attributed to wealthy Mainland investors buying vacation homes, but apparently there's also demand from buyers seeking full-time residence in million-dollar digs.
About 115 people submitted applications to participate in a lottery for 26 duplex homes — priced from the high $900,000s to $1.5 million — at the developing Kai Malu subdivision within Maui's Wailea Resort.
The lottery, held yesterday, was restricted to people submitting sworn statements that they will make the homes their principal residence for at least a year.
Such buyer demand at lofty prices confounds many moderate-income Island residents like Derek Stephens, a retired Navy communications operator who in 1996 paid $220,000 for a house in Wai'anae, O'ahu.
"I'd like to know who's buying these (homes) ... doctors, lawyers, June Jones?" Stephens said. "I had to take a job out of state in Diego Garcia just to make the mortgage payment in Wai'anae."
A spokeswoman for Kai Malu developer Armstrong Wailea Corp. said roughly 35 percent of lottery applicants are Hawai'i residents, and 65 percent are Mainland residents presumably interested in moving to Maui to live full-time.
The owner-occupant restriction that applies to Kai Malu is part of a law requiring home developers to offer 50 percent of any new condominium project to owner-occupants exclusively for 30 days before allowing investors to buy.
Last year, on the recommendation of the state Real Estate Commission, the Legislature repealed the law the commission said has been ineffective, abused and impractical to enforce. The repeal, however, has yet to be implemented.
At Kai Malu, another 26 homes not restricted to owner-occupants are expected to be made available for sale shortly. The two lots of 26 homes comprise the second of four phases of the 150-home project, a joint venture of Honolulu-based firms Armstrong Builders Ltd. and Alexander & Baldwin Inc. subsidiary A&B Properties.
"The real-estate market in Wailea remains strong, and the interest in Kai Malu demonstrates that our product certainly matches its demand," said Bob Armstrong, president of Armstrong Builders and Armstrong Wailea.
Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.
