Ka Malanai - Bargain or Bomb of Kailua?
D.R. Horton has offered for sale the final building in the new construction condos, Ka Malanai in Kailua. As an incentive, contracts signed by January 15th allowed buyers to select their kitchen materials. Six buildings are currently occupied, and work continues on buildings 7 and 8. Building 7 was released for purchase in late November, and building 8 is currently available. Building 7 is less preferred since it’s located on the corner of two roads, so I’d expect more auto and foot traffic noise there.
Building 8: The Premier Location
Building 8 is the premier location, since it’s the closest to Kailua Beach and away from the traffic and commercial activity of Kailua – but still close enough. The best unit available is 8303, a 3 bed/2 bath unit with 1,491 square feet and two parking stalls. This top floor unit is located in the back of the building bordering a residential area, so it should be quietest and breeziest, yet very close to all of Kailua town.
D.R. Horton released some Building 7 with the requirement that buyers be owner-occupants for at least a year, and use the home as their primary residence, thus giving preference to Hawaii residents. Building 8 does not have this requirement.
The community is approved for VA loans, so military members who PCS to Hawaii can live here and easily commute to the Marine Corps Base in Kaneohe, Joint Base Pearl Harbor Hickam, or the Coast Guard Station. Military veterans retiring to Kailua can also purchase here. Because of the price point, however, service members will have to put 25% of the difference between the purchase price and the VA loan limit ($721,050) down in cash.
Good Value for Kailua Condos
Ka Malanai was introduced in the fall of 2013 with the typical new construction fanfare and hype, including a lottery for the chance to purchase a unit. About two years later, the scene was different. After increasing commissions for agents selling multiple units from 3%, to 3.5%, to 4%, the sales center later offered price reductions and credits toward closing on certain units. But, as the median home price in Kailua kept increasing, Ka Malanai’s asking price began to look more “affordable” and the units sell at a steady rate.
Affordable is a contentious term in Kailua, one of the highest priced zip codes on Oahu. Many long-time Kailuans have disparaged D.R. Horton building this project because it replaced housing for lower income residents previously built on the site. The old building was by many accounts an eyesore with frequent police activity, but many residents were expecting condos geared more toward full-time, working class residents to replace it.
One-bedroom units are usually snapped up quickly and start at over $600,000. There are very few in the plan. Two-bedroom units are readily available, as they make up the bulk of the offering, starting in the mid $700′s. There are some three bedroom units also.
A buyer looking for a 3-bedroom residence in Kailua would have to value new construction and a central location well above space if they purchase in Ka Malanai. With a price tag starting at about $900,000, most buyers would prefer an older single family home outside of the center of Kailua, though those are rare, competition is tough, and condition average at best.
As I’ve predicted since 2013, the biggest fans of Ka Malanai should be the owners of the surrounding condos, such as Gardenia Manor, Poinciana Manor, and Hokulani, who have seen their condo values skyrocket with all of the attention next door. Many buyers drawn in by D.R. Horton’s persistent marketing found the prices out of their budget, but love this gem of a beach town, so they quickly looked next door to the older but pleasant units selling for $300,000 less.
In the fall of 2013, typical units in the neighboring buildings sold in the low $400,000 range, and now regularly sell for over $500,000, outpacing the Kailua zip code statistics. For example, here is a lovely two bed/two bath Poinciana Manor unit with just over 1,000 sqft currently listed for $520,000.
I have plenty of photos and video of Ka Malanai, and would be happy to answer any questions you may have about it, or about Kailua.