“It’s A Negotiable Market” In Hawaii
The Garden Island reports from Hawaii. “Kaua‘i home sales had a slower start than last year, with the Kaua‘i Board of Realtors reporting an almost 17 percent drop in the number of January island-wide house sales. January condominium sales fell about 70 percent.”
“However the numbers don’t necessarily represent a trend, said Scott Lindman, president of Kaua‘i Board of Realtors. ‘This is a very small sample,’ he said. ‘I believe that the demand is going to remain constant, and supply will remain constant.’”
“Both houses and condos stayed on the market longer in January 2007 than in January 2006. Houses took an average of 164 days to sell, up from 100 days in January 2006. Condominiums took 300 days to sell, compared to 38 in the year earlier period.”
The Honolulu Advertiser. “The O’ahu single-family median home price slipped to $600,000 in January as the housing market continued to cool from record highs. The Honolulu Board of Realtors said the median was down 2.4 percent from $615,000 in January 2006.”
“The median O’ahu condominium sales price was $320,000. Both condominium and single-family home prices are below record highs of $329,000 and $668,300 set in July 2006 and May 2006, respectively.”
“The market is cooling off as we’ve seen for over a year now, and it will probably continue to cool, but prices are holding,” Shapiro said. “I think it will stay this way at least through 2007.”
“Harvey Shapiro, the board’s research economist, is projecting that the number of homes and condominiums sold on O’ahu this year will fall for a second consecutive year, but remain at healthy levels compared to the low transaction rates of the mid-1990s.”
“‘The market is cooling off as we’ve seen for over a year now, and it will probably continue to cool, but prices are holding,’ Shapiro said. ‘I think it will stay this way at least through 2007.’”
“Richard Rice, an Olomana resident who has his four-bedroom, 2 1/2-bath home on the market for $759,000, said he believes prices won’t dip much farther based on his experience with Hawai’i real estate and what he’s read from experts. He said he believes prospective buyers visiting his open houses in recent weeks have the ‘buy-before-it-takes-off again’ mentality.”
The Star Bulletin. “Inventory of single-family homes also grew, to 1,747 last month compared with 1,578 a year ago, according to the board’s economist, Harvey Shapiro. The condominium inventory grew to 2,288 last month compared with 2,125 a year ago.”
“However, the total inventory remains less than it was three months ago, board figures show.”
“Jim Wright, president of Century 21 All Islands, says the volume of homes sold shrank over the past five quarters but that more contracts are moving around, meaning that more shoppers are out negotiating.”
“‘It’s what I call a neutral market,’ he said. ‘It’s not a seller’s market and it’s not a buyer’s market. It’s just a negotiable market. You’re going to get a fair deal if you work it out.’”
“Wright said he expects to see a 5 percent decline in value this year but also a higher number of units sold.”
“Veteran Realtor Margaret Murchie said buyers today are cautious. ‘I think we were flying so high, we were due for a transition,’ she said.”
“Murchie, who specializes in selling, said she has canceled a few listings from clients whose asking prices were unrealistically higher than the current market.”
“Sales seem to have slowed on the North Shore and Ewa side, according to Realtor associate Tony Kawaguchi. ‘If you have a nice house, and it’s updated with granite counters and wood floors and it’s in decent condition, you can sell it in a few weeks,’ he said. ‘A lot of homes are not in great condition … and people are just not buying those anymore because there’s more selection.’”
“A notable boost to Kaka’ako’s population began yesterday as the first residents of the twin-tower Moana Pacific condominium picked up keys. An estimated 2,000 or so people who over the next few months will settle into their units.”
“The project’s 720 units make it the third-largest residential high-rise condo project on O’ahu. The first two, Hokua and Ko’olani, opened early last year. Five others are planned or under construction in Kaka’ako, while several more are planned or under construction in Waikiki and downtown.”
“Research analyst John Jacobson, said the impact on O’ahu’s real estate market of such a large condo will be that many people will be moving out of homes, apartments and other condos, though the greater effect on the market won’t be huge.”
“‘With our continued growth of the condo inventory, the (new) building is a relative drop in the bucket,’ he said, adding that there were more dramatic condo development booms in the late 1970s and late 1980s.”
‘However, the total inventory remains less than it was three months ago, board figures show.’
It’s interesting that this happened in just about every market that comes to mind.
Part of the $40 million ad campaign - positive spin only!
Ignore those facts which might tell a different story.
Inventory, like sales, exhibit seasonal patterns and can’t be compared on a month over month basis without seasonal adjustment.
jb
Take North Jersey, for example.. Inventory is significantly lower than 3 months ago. Now put that into perspective:
http://njrereport.com/images/jan07c.gif
jb
http://ca.biz.yahoo.com/prnews/070205/nym170.html?.v=71
“You’re seeing 40 or 50 (subprime companies) a day throughout the country going down in one form or another. I expect that to continue throughout the year.”
Then it goes on and says they expect delinquency rates to increase but not go higher than in the previous cycles. But weren’t there downpayment requirments in previous cycles and this one is way larger than those wouldn’t the rates be much higher?
Our house in Kona on the Big Island is currently in escrow. We had to cut the price four times to get a buyer. There’s a huge number of homes on the market. Sellers are reluctant to cut their prices but eventually they’ll have to. The realtors are spouting their “boomers are moving to Hawaii” rhetoric, but if the boomers can’t sell their homes in California, they can’t buy one in Hawaii.
As of today there are 905 residential listings in N. Kona, up from 577 on 1-1-06. North Kona population approx. 28K, or 1 listing for every 31 residents.
Inventory on Oahu, Kaua’i and Hawai’i may be down from 3 months ago, but Maui’s is up.
Inventory in Kauai is up 10% just in January, and we haven’t even gotten to the spring season/sales crush.
One more point: everyone wanting to sell at ridiculous prices here in the islands have their sights on one candidate: rich californians. Theyre typically the only ones that have the cash to afford the prices here right now. My landlord flat out told me this, confirming my beliefs. I have price history going back to the 90’s, this place is toast. 50-60% drop is in the cards. California is toast, look at the ads for San Diego on craigslist, yikes. Hawaii lags by a year or so, and we had inventory up about 50% last year, so this year should be a monster. Oh, said landlord’s wife wanted me to go invest 300K in some land and 200K to build a house to get equity. I pointed out there’s no guarantee of equity just because you build instead of buy an existing structure. People here are going to be taught some tough lessons over the next several years.
“He said he believes prospective buyers visiting his open houses in recent weeks have the ‘buy-before-it-takes-off again’ mentality.”
This is why David Lereah makes the big bucks, and probably isn’t a religious man.
This goes right along with the running out of land theory. How do these idiots think prices are just going to take off again? Nothing but lemming mentality. There is a limit of what people can and will pay for housing. Especially when you consider the effects the coming recession will have on HI’s economy, one that is incredibly dependent upon tourism. How many HI vacations were HELOC financed?
“This is why David Lereah makes the big bucks, and probably isn’t a religious man.”
I would disagree completely with this statement. I have found that the people that wear their religion on their sleeve are the most dangerous people on the planet. They will lie to you, cheat you, rob you and even blow you up. They feel that they are chosen by god and therefore they can do whatever they want. I bet that phony bastard, Lereah, is at the front of his congregation every Sunday.
Amen to that brother. The most crooked people are the ones visiting church and praying for forgiveness from their sins.They tend to hide behind their faith.
My Grandma goes to church and she’s pretty cool, but hasn’t been feeling well lately. She likes the idea of sinners burning to a crisp in this place callled Hell, so I told her about a place called Phoenix and that cheered her up a bit.
LOL!
You got that right- especially those following the religions of Stalinism, Maoism, Naziism, the French Reign of Terror– in short, those dogmatic, devout atheists were some of the most honest and trustworthy people of all time.
Stalinism, Maoism and Naziism were merely secular religions. All of the instincts of fanatacism and zealotry were transferred from churches to government offices. Have you ever noticed how much the preachings of Marx and the preachings of Christ have in common? Marx knew that Christianity was merely a competing religion to the religion that he was trying to create.
nice point, nycboy
Even though I am not a Christian, I don’t think Christ ever called for the death of businessmen nor the forcible redistribution of wealth like the Marxists. Nice spin though.
“…17 percent drop in the number of January island-wide house sales. January condominium sales fell about 70 percent.”
“However the numbers don’t necessarily represent a trend, said Scott Lindman, president of Kaua‘i Board of Realtors. ‘This is a very small sample,’ he said. ‘I believe that the demand is going to remain constant, and supply will remain constant.’”
This sounds like New Era Economics — the number of homes sold drops through the floor, while demand and supply both remain constant. I am trying to figure out how to draw the graph that explains this economic miracle.
Let me retranslate:
“My income is dependent on the commision generated from transactions. I really hope the market rebounds or I’m unemployed in a very high cost of living state.”
This… is a very national bubble.
Even my “non-aware” coworkers are discussing how homes will be cheaper. I make sure they know to wait 2 to 3 years.
Got popcorn?
Neil
“…17 percent drop in the number of January island-wide house sales. January condominium sales fell about 70 percent.”
Don’t forget, the winter months are peak buying season in Hawaii.
A lot of the realtor and lender chumps on Kauai drive H2s. With the price of gas here (2.99/gallon), its retarded. Before the boom apparently all the chumps drove cherokees. Now theyve upgraded to H2s. Next car? A VW thing!
He said he believes prospective buyers visiting his open houses in recent weeks have the ‘buy-before-it-takes-off again’ mentality.”
Really? Does he have an earnest money check in hand? No? Next!
“Richard Rice, believes prices won’t dip much farther based on his experience with Hawai’i real estate and what he’s read from experts.
Dick has some serious issues…a big disconnect. If the ‘Experts’ were so sure of themselves - they would of purchased his house.
Obviously Dick’s experience doesn’t stretch back into the 90’s when my buddy on Oahu was making a bundle maintaining foreclosed properties. Back then the nightmare came from the West in the form of disappearing Japanese investors. This time they have the Red, White and Blue to thank for their latest bubble. At least you’re being screwed by your own.
Doesn’t “open houses in recent weeks” imply he had an open house at least 2-3 weeks ago? One would think all of those “buy before it takes off again” people would have started a bidding war two weeks ago on this property and it would be well into escrow.
Oahu….if your into street racing, meth addicted local bullies, traffic out the wazzoo, a cost of living index thats through the roof, then this is the place for you.
I contend that the sole reason real estate prices are anywhere near the levels they are on Oahu is based on ONE thing, MILITARY SPENDING.. ya see, the swabbies, jarheads, coasties, AF flunkies all get a little bonus check from uncle Sam to help with the housing costs, so, they all go out and buy all they can afford, adn sell to the next guy in line after they get shipped out…
my 2 cents
Hey! I was one of the jarheads based on Oahu! I lived in the barracks though. I agree with you, without DoD spending, Oahu would be a very different place, quite possibly for the better. HI suffers from being perfectly located from a strategic point of view, hence we will not see the military leaving. Perhaps if they built more housing on-base we would not have so bad of a problem? Regardless, current prices are unsustainable.
The good news is you were not an Air Force Puke.
as to your question:
they are building more on base housing, you know that little island in the middle of Pearl, its called Ford Island. They now have a bridge to it (no more ferry), and they are packing it to the gills with houses brought to you with taxpayers dollars.
Oaho, just like Maui, is what known as “PAU”
translation= “finished”
lttlle cost of living joke, Know what they call a hundred dollar bill on Maui?
A Maui dollar.
“The good news is you were not an Air Force Puke.”
You must live near Hickam? I had seen a blurb somewhere about residential going onto Ford Island. That place was pretty desolate. Went there once to get one of our guys from the brig. Will it be only for military personnel?
Like the Maui dollar joke, its so true! I don’t know what the best thing for HI is, I’m just glad to no longer be in the military! There are worse things than being a jealous, bitter renter, and that is one of them!!!
RE= mc2
“I believe that the demand is going to remain constant, and supply will remain constant.’”\believe what you want due
That drop in sales in January was clearly weather-related. You see, it was only 84 degrees instead of the usual 86.
GS, give the man credit.
Demand will remain constant ie. none
Supply will remain constant ie. infinite
When did this become a porn site? Check out the Dove Commerical. LOL
how many counties in usa that are not NG drilling areas went up ?
a. =0
The news is: Your home is worth $100,000 less than it was a year and a half ago.” — yikes.
http://news.yahoo.com/s/nm/20070206/bs_nm/usa_economy_housing_dc
Thanks to investing in energy, emerging markets, and gold, my portfolio is up 30% y-o-y…
Good link. From the article:
“I think it was easy for builders to think that there were real users in these fringe areas far from jobs and entertainment,” he said. “In fact, we found that purchases in those areas over the last three years or so … were speculators and not users.”
Uh, yeah right! A blind man could have seen it was speculator driven. I have taken drives through some of the bay area exurbs, and it was pretty obvious from the get go that no one was moving into some of the homes sold. i.e. No furniture, front lawn 10 inches high, numerous flyers and other crap littering the front door and steps. This guy seems to think the builders had no idea? I still want some realtor or other RE bull to come here and explain to us how this can all unwind systematically and relatively free of pain. Some party, somewhere is going to take it in the shorts on each and every one of these vacant homes. Add in the homes that will become REO, and it is total chaos. Soft landing me a$$!
You bitter Hawaii renters better buy now or be priced out forever! If you don’t buy, you’ll end up in the tent city Waianae.
Housing in Honolulu will never go down. Honolulu is different and special. All of the super rich from CA will move to Hawaii to buy that shack on the corner.
They aren’t making any more land and everybody wants to live here. And the Japanese will buy all the land to keep prices from dropping. And all of the baby boomers want to retire here, too.
Besides, you can always refinance to pay your mortgage with a no-doc option ARM year after year forever!
Aren’t they making more land in Hawaii? I thought that’s what Mauna Loa was doing every time it erupted.
Honolulu prices WILL GO DOWN.
The flaw in your arguement is the term, never.
Just becasue you have an address near K-Bay, and you are a LT JG, does not a millionaire make.
You need to brush up on what happened after the Japanese filled that Hawaiian Bubble about 20 years ago…..just now gettin back to the glory days of over priced humid real estate.
shooots, cuz
Oops. Sarcasm off.
Hawaii tends to lag the mainland by a year or two. But the buyers in both places use the same banks to get the same toxic loans. Prices will surely fall back to earth.
I live just outside of Chicago and with our weather today, a retirement spent in Hawaii sure looks inviting!
I left Chicago myself. I miss the good eating, and HI isn’t for everybody, but I can’t complain!
I’d rather rent here than own there! ;’)
oh yeah. Christ was crucified.
I was just in Kauai last week around Princeville. It sure seemed like alot of stuff was for sale, as well as still under construction. I talked to a couple of RE agents, one of whom was actually quite honest. It was about a 2bd/2ba condo ocean front overlooking Anini beach. He said, “I told the owner what its worth and he told me this view is worth 1 million.” I am guessing it should have been around 700k. Needless to say not much is moving, but there sure are alot of realtors on Kauai.
Josh