Waikoloa Real Estate Market Forecast 2023

With its warm, impeccable weather and scenic, extraordinary landscapes, Hawaii has long been one of the most sought-after places to visit and live.

One of its most exquisite enclaves is Waikoloa, a sun-drenched haven located on the Big Island’s sublime west side. The sophisticated resort community has received heightened interest in the past several years and is only expected to deepen its reputation as a highly-coveted place to call home.

You may be a fortunate homeowner who is eyeing the possibility of listing your piece of Waikoloa real estate in the coming year. Or perhaps you are exploring Waikoloa homes for sale for possible purchase in 2023. Whatever the case may be, there’s a high chance you want to enter your next real estate deal with as much knowledge as possible, particularly in terms of where the real estate is headed as 2022 comes to a close and we enter a new year. This will furnish you with the knowledge you need to either press pause on your real estate transaction or pounce at precisely the right time.

Intrigued? Read on for an expert guide to the leading predictions heading into 2023.

In the past two years, home prices around the Aloha State have skyrocketed to unprecedented numbers. Hawaii has the highest median home price of $848,926 across the state. Inventory remains low while demand continues to escalate. In Hawaii County, the average sales price of single-family homes fluctuates around $700,000 as of fall 2022. Waikoloa real estate specifically commands even higher prices, with a median price of $1.4 million.

In addition to the gorgeous landscape and resort-style amenities, Hawaii’s appeal stems from the fact that residents on the mainland who have been granted WFH indefinitely are capitalizing on the rare opportunity to work from wherever they please, and for many, their top option is Hawaii. At the same time, Hawaii as a whole has a limited and comparatively small amount of land available for housing; these, after all, are islands with finite space. This has only deepened Hawaii’s demand, which is especially attractive to luxury homebuyers who desire to obtain a property that assures exceptional serenity and privacy.

Waikoloa offers both of these attributes in spades. As one of the most luxurious communities in the Hawaiian archipelago, it offers perpetual tranquility and a wide, impressive range of high-profile properties that emphasize peace and seclusion. From sprawling mansions to elegant condominiums, the homes on the Kohala Coast will continue to be supremely attractive to remote workers hoping to relocate, foreign investors, and families leaving the busier islands of Maui and Oahu for a more rustic and community-focused lifestyle.

In 2021 and 2022, we saw one of the most astounding leaps in Hawaii real estate as the pandemic adjusted our life values, and people from across the world pursued living in the happiest state in the nation. This was incredibly lucrative for homeowners who chose to sell during this blazing-hot time.

And yet, the rate at which home prices have been rising is unsustainable, especially as the cost of living continues to peak around the nation and most especially in Hawaii, which has an 88% higher cost of living than the rest of the United States. Simple logistics indicate that this will render buying a home implausible for many if home prices continue to increase at the same pace. This will decelerate the rise, which is a shift we are most likely to see in the middle of 2023. This will cause a cooling off across the board to lure homebuyers off of the sidelines and back into the market.

High-profile properties are expected to be immune to this, however, but these luxury estates may spend more time on the market as investors wait for news of where the economy as a whole is headed.

Interest rates dipped in the past two years before the third quarter of 2022 hit, when they rose to a whiplash-inducing 6.29% for a fixed, 30-year mortgage loan. This is significant, and it caused many hopeful buyers to abandon their plans (for now) to see what will happen to the state of the economy throughout the rest of 2022 and into 2023. If rates keep rising, many homebuyers will simply be unable to purchase a home or will be reluctant to do so because of the enormous spike in the interest they will have to pay. Some estimates suggest that the race to buy a home won’t pick back up until 2024 or 2025, but all of this is subject to change in the blink of an eye. After all, experts also predicted that real estate would sink amid and post-pandemic; instead, the nation went on a historic, mindblowing run.

Hawaii may be the happiest state in the nation, but many of its residents aren’t thrilled about one thing: the lack of viable housing and the dramatic increase in rental prices. For example, rental prices in Honolulu surged 11% in 2022; in Hilo, 15%. On Maui, rental prices shot up 41% above the preceding year. At the same time, the availability of rentals has fallen to an all-time low as city dwellers fled their homes for the aloha way of life and island homeowners jumped into the real estate market to sell their homes for a robust profit. What does this mean to investors? Purchasing investment properties for long-term rentals might be a win-win situation. You may be able to pull in a significant passive income while also helping to solve one of the largest socio-economic issues in Hawaii.

If you’re looking toward a new home in paradise, Nate Gaddis of Wai Pacific is the realtor you want on your side to expertly navigate the changing real estate tides we are expected to encounter in the new year. With specialties in Hilo real estate and condos for sale in Kailua-Kona, he stays on the cutting edge of market trends and provides invaluable counsel on the best times to buy and sell. Book a consultation with him today to begin realizing your real estate aspirations and goals.