Aloha, Condos do well on Kauai and Hawaii island

Aloha,   Sales of single-family homes decline on both islands, with median prices mixed. Condominium sales rose in October on Kauai and Hawaii island, but the same wasn’t true for single-family houses on the same islands, where there has been a general trend of higher demand from home buyers this year.  A report released Tuesday by Hawaii Information Service showed some easing in demand last month, though most homes were sold at higher prices compared with the same month last year.

The biggest gain in sales occurred for condos on Hawaii island, where volume jumped 38 percent to 62 last month from 45 a year earlier. The median price edged up 2 percent to $219,475 from $215,000 in the same period. The median is a point at which half the sales were for more and half for less.   In Hawaii island’s single-family house market, the number of sales slipped 3 percent to 153 last month from 157 a year earlier. Though the decrease was small, it compares with a 17 percent gain in sales over the first 10 months of this year. The median price for Hawaii island single-family houses declined 10 percent to $269,000 from $299,999.

On Kauai, single-family house sales declined 23 percent to 30 last month from 39 a year earlier. For the first 10 months of this year, sales were up 11 percent. The median price for Kauai single-family houses jumped 43 percent to $586,000 from $410,000. The increase was driven in part by fewer sales at the lower end of the market in the Kawaihau region, according to Hawaii Information data.  In October 2012, 21 of the 39 single-family houses sold on Kauai were in the Kawaihau region. The median price for the 21 homes was $385,000. Last month there were just seven sales in the same area for a median $470,000.

Most home sales on Kauai last month happened in the Koloa area, where there were nine sales for a median $675,000 compared with eight sales for a median $489,500 last October.  In Kauai’s condo market, there were 33 sales last month compared with 29 a year earlier, reflecting a 14 percent gain. The median price was up 28 percent to $320,000 from $250,000 in the same period.

Luxury yachts, high-end speed boats are the latest toys for China’s young, rich and famous.

Stretch out on the velvet couch, take a sip of wine and gaze upon a tranquil sea, then be invigorated by ocean spray and a cool breeze on deck – that’s not a scene found in movies, but increasingly, it’s the good life being enjoyed by high society in China. And not only in the upper echelons.

According to the 2010-2011 China Yacht Industry Report by the China Cruise and Yacht Industry Association and the China Ship Information Center, there were 99 yacht clubs in the country with up to 1,500 yachts among them. Of these clubs, 26 were still under construction and 45 had completed the planning stage.

“The yacht industry has surfaced silently in China in recent years, gradually unveiling itself and attracting attention from all areas,” said Qian Yongchang, director of China Communications and Transportation Association.

Dianshan Lake in west Shanghai and Taihu Lake in south Jiangsu province have seen a big rise in the number of yacht clubs in recent years, which has buoyed the surrounding property market.

Zhu Ziye joined Shanghai Marina Club in 2010 and charters a yacht about once a month, when he holds parties or gets together with friends.

“It costs about 7,000 yuan ($1,100) an hour to rent the yacht from the club and I don’t have to worry about its maintenance, which is quite expensive, about 10 percent of the value of the yacht,” said Zhu, 43.

He said some of his friends are considering buying their own yachts for about 100,000 yuan.

The 17th China (Shanghai) International Boat Show in April also witnessed the changing fortunes.

The four-day exhibition notched up a total of 2.2 billion yuan of sales, about 120 percent increase from last year, and the most for any exhibition of its kind in China.

Yachts priced between 300,000 yuan and 600,000 yuan ($47,100 and $94,200) were the most popular during this year’s boat show. US-based yacht manufacturer Brunswick sold 13 Harris 220 yachts at 320,000 yuan each, and the Jiangsu Xinsheng Marine company completed 33 deals, with yachts priced between 300,000 and 350,000 yuan.

While owning a yacht may be considered the height of luxury, the emergence of yacht clubs has helped to counter the “aristocratic” image and to rebuild it as a healthy recreational lifestyle.

“Owning a yacht is no longer a luxurious lifestyle as more yachts with reasonable prices become available to middle-class businessmen who want to spend their leisure time sailing out of the city to enjoy the sunshine and fresh air,” said Zhu.

Less affluent visitors are also said to have shown unprecedented enthusiasm for the boat show. About 31,835 attended this year, 40 percent more than 2011, although about half were from overseas.

Gao Haiyan, project manager of Shanghai UBM Sino Expo company, one of the organizers of the boat show, was not surprised by the record high sales or the growing interest in affordable yachts.

“Throughout the 17-year history of the boat show, we have witnessed the maturity of the entire yacht industry. We have also noticed that people’s interest has gradually moved from super luxurious yachts to the moderately priced ones,” said Gao.

“Yachts are no longer luxuries nowadays. With China’s economic advances, it is certain more Chinese will have their own yachts. Reaching the general public is definitely the trend of yacht industry development,” said Yang Xinfa, chairman of the China Boating Industry and Trade Association.

Domestic buyers used to attach more importance to a boat’s size, believing that the larger it was, the more luxurious. “But as the market matures and their tastes modify, it’s become the trend where buyers turn to overseas design firms to complete the style of the yacht in terms of light, color and fittings in accordance with their own aesthetics,” said Yang.

The yacht industry in China has lagged behind that of the West, which has a long history.

“People’s understanding of yachts is still at a preliminary level. However, some rich people in China have come to realize that yachting is a very good recreation and exercise. I am confident that this kind of lifestyle will widely spread in the near future,” he said.

According to the Shenzhen-based industry research firm CI Consulting, the yacht economy sprouts in Western countries when GDP per capita reaches $3,000. At present, there are more than 20 coastal Chinese cities with a GDP per capita above $8,000.

China also has a coastline stretching more than 18,000 kilometers. Together with the 6,500 islands and 24,800 lakes, the country offers huge potential for growth in the water recreation market and development of the yacht industry. It is predicted that yachts will become the next consumption growth indicator after property and automobiles.

Wang Depei, director of Shanghai Forecast think tank, said the real economy will grow into one based on human experience.

“As a combination of real economy and human experience economy, the yacht industry could well indicate future trends in consumption,” said Wang.

Jeff Chuan, a head of Standard Chartered China, said: “The so-called rich second generation in China are transferring their interest from sports cars to yachts. They may grow into private-jet fans in the future. It is an inevitable trend. While they are growing from super fans of sports cars to yachts, it means that their values and appreciation have been promoted.”

Shi Jing reports in Shanghai.

Contact the writer at shijing@chinadaily.