Last year, a law was passed that required all buildings 50 years or older to undergo a special procedure (ie. document & submit photos to the State Historic Preservation Division) for any work that was to be done to a structure or demolished. This Act 228 caused a major backlog in the state and they did not have the personnel to handle such volume. Getting building permits in Hawaii have never a simple step & this law just added more red tape... Although the law may have had good intent, there are many, many homes in Hawaii that are over 50 years old. I just looked back at my last 10 single family home transactions & 7 of the 10 were over 50 years old! The Hawaii Association of Realtors spoke out as well as many in the building industry against the law. Recently, Governor Lingle repealed it and now homeowners can get back to fulfilling their goals of remodeling their dream homes :)
For those of you that don't know, Maunawili is the first neighborhood you come to after going over the Pali to Kailua. What's great about it, is you're minutes from the pristine white beaches of Kailua, yet also minutes away from Downtown Honolulu. Many doctors, attorneys & business professionals choose to reside here due to its close proximity to town. It's also just about a 20 minute drive to some of the best private schools in town. Or, if you don't want the commute, Le Jardin Academy is right there. Other attractions are gorgeous Mount Olomana and the lush greenery of the Windward side of Oahu.
Maunawili has also been a hot real estate market as of late. Although there's only been 4 sales in the past 6 months (1 of which was $2 million), there are currently 4 under contract with an average of only 25 days on market! There's an additional 4 active listing averaging only 23 days on market, ranging from $1,079,000 to $1,330,000. These are all decent sized lots ranging from 10,000 - 17,000 square feet. One of these listings is my own. You can click here for more information. We had 2 great offers in the first two weeks! We have an accepted offer, however the buyer must sell first. Most of us will be open this Sunday from 2-5 PM, so please stop by :)
Almost every indicator for March showed the market much stronger than January & February. Part of this could be seasonal, however on a % basis things were pretty good. The number of single family home sales were up 45% and condo sales were up 55%! Median home prices month over month were up 8% and condos up 2.6%. Days on market for homes were down 30% and 32% for condos. This is twofold: things are selling quicker and things that aren't selling, sellers are pulling off the market to rent. This is also reflected in the inventory with 27 less homes on the market than the previous month. However, condo inventory is up 75 units in the same period.
Could this be a sign of a recovery? Although early to say, there was a recent article in Forbes indicating that the economy could possibly have bottomed out. Given all the bad financial news this past fall, that trickled over to closings & statistics in January & February. March's stats paint a better picture of what's been happening since the beginning of 2009, with most properties that went under contract in mid- January & shortly thereafter equate to closings in March.
I've also noticed buyer activity picking up dramatically. I thought I had a busy open house last Sunday with 30 parties coming through. Another agent in my office had 50 parties (yes Five Zero) come through his! Not too long ago most agents I talked to would be happy with 10 parties...
February of 2009 continued right where January left off. We had 129 single family homes and 160 homes close last month. Our year to date volume is down 53% from last year. In order to find similar numbers, we have to go back to around 1995-1996 which many can argue was the bottom of the previous down market. Our median sales price was $555,000 for single family homes and $297,000 for condos. The last time we had these prices were early 2005 for homes and mid 2006 for condos. Our days on market for homes are 69 and 70 for condos, which isn't that bad still compared to most of the mainland US. I'm surprised as to how many buyer inquiries I've had over the past several weeks where the home they're inquiring on is under contract. Even though the numbers of sales are down significantly, well priced homes are selling.
When broken down per region, Waialae-Kahala led the market w/ numbers of sales up 18% from last year and prices up 8% for single family homes year to date* For the biggest buying opportunities, Pearl City-Aiea home prices are down 33% from last year. On the condo front, Kalihi condos were up 33%. Perhaps the best buying opportunity could be Kapahulu-Kuliouou which was down 62% (part of reason was some leasehold sales drug down the prices). Outside of that, Ala Moana to Kakaako was down 43% and could create some opportunity there as well.
On a bright note, amid all the doom & gloom in the news, real estate has held its price well as an asset class. Recently, the S & P 500 index is now worth the same as it was in 1996. If you invested $100,000 then, it would be worth $100,000 today, 13 years later. If you invested $100,000 in Oahu real estate then, you would be far better off! With no financing or leverage involved, you would be up 50% on average. When you add in leverage/financing, tax incentives, etc. you would could have increased your returns exponentially!
*It was also Waialae-Kahala's appreciation that led us out of the last down market.
The Honolulu Board of Realtors has released the latest stats for January of 2008. The median sales price of a single family home on Oahu is down 10% from the previous year- from $600,000 to $539,500 which puts us back to Feb./March of 2005 levels. The North Shore led the way- down 51.8% from the previous year. East Oahu held strong w/ a median sales price up 2.2% from 2008! Remember- ALL MARKETS ARE LOCAL What may be happening in one neighborhood might not be happening in another... Our median sales price for a condo is also down 5% from $324,000 to $305,000. To show how slow the North Shore is, there was not one condo sale there in January. We are also now at 71 days on market for Single Family homes & 59 days for condos, which isn't too bad compared to the rest of the mainland U.S. Our inventory is actually down slightly from Dec. of 2008 w/ 70 less homes on the market and 140 less condos & these numbers are real close to where we were this time last year. What has really slowed down dramatically is the number of sales on Oahu. There were 122 homes and 159 condos that sold in January, down 46% and 51% from previous year and down 37% and 35% from December of 2008. These were the lowest numbers of sales since the mid-1990's. In hindsight, this was the best time to buy real estate here. Nobody has a "crystal ball", but now could be a good time as well...
The "Buck" Stops Here for All Your Real Estate Needs! David E. Buck (RA) at your service! Your local source for information, satisfying his buyers and sellers needs! Servicing all of Oahu, Hawaii.
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