Hawaii real estate by Bonnebaker

The Honolulu Board of REALTORS released resale figures today for the month of July. According to the analysis conducted by the Board, using data collected from its computerized Multiple Listing Service (MLS) system, the real estate statistics are:

During July, sales of 265 single-family homes and 327 condominiums were reported through the Honolulu Board’s MLS, an increase of 5.6 percent for single-family homes and a decrease of 10.4 percent for condominiums, compared to the same month last year. This brings total single-family home sales on Oahu to 1,372 for the first seven months of 2009, a decrease of 17.5 percent over the same time period one year ago. Total condominium sales through July were 1,707, a 32.3 percent decrease from last year. The median prices paid for island properties in the first seven months of 2009 were $570,000 and $307,000, respectively, decreases of 9.1 percent for single-family homes from the same time period in 2008 and 7.0 percent for condominiums. The year-to-date total dollar sales volume generated in the housing market through July was $1,524.1 million, a decrease of 34.5 percent, or $801.4 million, compared to the $2.3 billion produced one year ago.

“This is the second consecutive month we’ve had an uptick in single-family home resales and it is a welcome change for the current housing market,” said Sandra “Sam” Bangerter, president of the Honolulu Board of REALTORS®. “Also, the median prices paid in both housing categories increased this month compared to last. While we’re continually monitoring economic conditions, both nationally and locally, the numbers we’re seeing for the Oahu residential real estate market may be indicating that we’re already past the bottom.”

“Credit our small, continually shrinking inventory for maintaining relatively stable price levels, even with the lower demand for housing,” added Harvey Shapiro, research economist at the Honolulu Board of REALTORS®. “President Obama says that the government stimulus programs are bearing fruit, particularly for the auto sector, so we’re hopeful that the housing industry will follow suit.”

The public is encouraged to visit the Board’s Internet web site at www.HiCentral.com to see what’s happening in the housing market. The public has the ability to search through Oahu single-family home and condominium listings, available for sale and for rent, and to see a comprehensive guide of homes that will be open to visit this Sunday. All searches can be done by geographic location, price range or both. HiCentral.com provides useful information about buying and selling real estate in Hawaii.

Established in 1922, the Honolulu Board of REALTORS® is one of the largest of 1,600 boards of REALTORS® in the nation and, with over 5,500 members, the largest trade organization on Oahu. Membership is available to licensed real estate brokers, agents, property managers, appraisers, counselors and others engaged in all aspects of the real estate industry pledged to adhere to a strict Code of Ethics and Standards of Practice. For more information, call (808) 732-3000 or visit www.HiCentral.com.

(This Hawaii real estate report reflects information about resales of existing properties only and does not include new home sales. All of the MLS information is compiled from sales reported during the cited months; this data is known only after closing of escrow. The time delay between the signing of a sales contract and the closing of escrow is usually between one and three months.)

The Hokua Condominium has been very popular since it was built in 2006.  This is one of the first new high rise condominium projects that became available during this new building phase in the economic cycle.  The amenities that were offered were like nothing readily seen in condominiums in Hawaii, which includes a dog park and guest suites.  Plus, the size of the units was very attractive for those looking to downsize from a single family home or for those who were interested in having it be their second home.  The units are all quite a bit larger than most every other condominium available in Honolulu.  Those interested in making the Hokua their second home made up most of the original sales in the building.  Because of its convenient location and generous amenities, it was and is still ideal for those who wish to have a getaway place in Hawaii.

Hokua sales statistics from 2007 till July 2009

While the building was being constructed, the real estate prices across Hawaii began to rise.  At the time of closing on the units in 2006, many new owners were aware the units were worth far more than what they had contracted for.  There were some that were resold in the few months that followed the completion of the building at anywhere from 19% to 130% over what was paid for the unit.  The average increase from the original purchase price was a whopping 71%.  However, it was only approximately 11% of the units in the building that sold their newly purchased unit within the first months.  That is a small amount when you compare with other newly constructed buildings in Honolulu.  The fact was that there was and is still not another building like it in Honolulu.  This may change with the Trump Tower Waikiki project, but comparing entry costs and maintenance fees, the Hokua can offer much more value than the Trump Tower Waikiki.

Throughout 2006 and most of 2007, the sales were generally keeping up with the units that were coming on the market.  As you can see from the chart below, the new units were generally being absorbed into the market with relative ease.  No matter the price range, from the low end to the multi-million dollar upper end, the Hokua was in high demand.  As the market began to peak and

with the general faltering housing market on the mainland, the chart shows a waning interest in the Hokua at these price levels.  Then, clearly as the economy has had increasing problems and the credit liquidity was threatened, the sales became near nonexistent.

Hokua view of Waikiki and Diamond Head

There have been 3 sales since the beginning of the year:  two in January and one in February.  And currently there are 3 units under contract.  So, because of the uniqueness of this building the interest in these units is still there even at current prices.  Still the average days on market (DOM) is 177 days, which is rather lengthy traditionally for the Hawaii real estate market.  These last three sales prices were, on average, only 8% lower than list price which represents a narrowing gap between buyers and sellers from late last year.  It will be very telling to see the sales prices for the units currently under contract.

To learn more about the Hokua Condominium and to see what is currently available on the market click here.  If you interested in a private viewing of any of these units at the Hokua, please contact, Malia Meenderman, a 808-394-9779.

Windward Oahu condominium units are another bright spot found in the latest May 2009 Hawaii real estate resale statistics.  The median sales price has declined only .8% since a year ago.  There has been a more than 40% decline in the number of sales in the area but there are far fewer condos coming on the market.  The windward side of Oahu encompasses the towns of Waimanalo, Kailua, Kaneohe, and out to Kaaawa.  These areas have primarily been agriculture and slowly have turned over the years into single family homes.  There has not been many tracts of land converted in condominium use.  The most dense area of condominiums is in Kaneohe town.  Kailua and Kaneohe especially have been such attractive places to live.  They both have tight knit communities and Kailua has beautiful beaches (Lanikai and Kailua) and Kaneohe is kept cool in the gentle trade winds set close tot he Koolau mountains.  All of these communities have such a nice small town feel and yet are all relatively close to the city life in Honolulu.  Because of this attraction, many people want to live here.  Over the years housing has become less and less affordable.  Several old and run down multi unit apartment buildings were torn down to make way for more development.  These were some of the last affordable living units on the windward side.  The strong desire to be apart of these communities has been most likely the cause for these sale prices not falling. I suspect that in coming months we will not see a dramatic price decline, just perhaps less people wanting to sell at the current prices.