It is well known that there probably isn’t a piece of real estate in the Kahala area of Diamond Head that sells for less than $1,000,000. Even the oldest buildings are priced well above that, but there are some amazing investment properties even at that price. Coveted beachfront properties will of course sell for considerably higher prices, but even so, once the older homes are renovated they will make a handsome sum for the investor who had the foresight to snatch up the property while it was available.
Tear-Down Houses Quite Popular
Many of the older homes in Kahala would actually cost more to restore to their previous states of luxury so real estate investors come in and buy up these homes to tear them down. The property alone is often worth more than the asking price of the home which is why they sell quite quickly and easily. Where the older home once stood a newer, more spacious mansion is built which attracts the younger elite. Kahala has a mix of older residents who have lived on the island for decades and then there is a younger crowd of budding millionaires who have come to Kahala for the luxury it provides.
Renovating Older Homes
Some of the homes in Kahala are actually in quite good repair. There is no need to tear them down so investors simply hire restoration contractors to bring them back to their previous state of elegance. It is not unusual for these restored homes to sell for double the price the investor snatched up the property for and these are the homes which seem to be most in demand. The older the home, the more character it is likely to have and there is nothing quite like an authentic Hawaiian mansion built in the mid part of the last century. Newer properties may have more amenities, but older homes have more class.
The Law of Supply and Demand
Keep in mind that Kahala properties are coveted by those who can afford a 7 or 8 figure price tag. Also, consider the fact that Kahala is a small area of Diamond Head that isn’t going to grow. There are only so many acres available to be built on and as more and more young business moguls and celebrities buy up existing properties there will be fewer left to be developed, torn-down or renovated. Because of the basic law of supply and demand, the high demand for limited properties can only serve to keep the prices on an upward swing.
Perhaps it is the relative flatness unlike other areas of the island that makes Kahala as popular as it is and then it could be its proximity to Waikiki. In fact, it is close enough to this popular tourist spot to travel within minutes, but far enough to enjoy the relative seclusion of these high end homes. In any case, Kahala investment properties are among some of the soundest real estate investments in the nation and any investor would be wise to consider Kahala as his or her next business venture.