The real estate market on Kauai continues to fight the trend seen on many mainland markets. That trend is sharply lower prices driven by an abundance of bank foreclosures. We have definitely experienced a slowdown in numbers of transactions and sales volume. The upper end of the market, those homes above three million, and the lower end, those below $600,000 are the most active.

The middle of the market, however, has seen a steadily increasing number of days on the market prior to sale. Overall, prices have declined 5% in the last 12 months, a modest decline considering the rapid run up of the prior three years. There is not a large foreclosure problem on Kauai as none of the exotic no money down loans were made here.

Looking ahead, most local economists expect our market to recover sometime in 2009. Until then, those homeowners with homes above $600,000 will need to be creative in order to sell their homes.