Oahu’s real estate market gets a summertime boost

Despite Oahu inventory levels reaching two-year highs in June, the market remains steadfast, though not as feverishly pitched as previous months.

“The summer months have given a boost of adrenaline to the Oahu real estate market,” says Kalama Kim, Realtor and principal broker at Coldwell Banker Pacific Properties. “While pending sales are down 7.7% year-to-date through June, that decline is much more tolerable than the 20-plus percent decline experienced last year. The boost is due to a combination of the normal summer demand and declining mortgage interest rates.”

Stats collected from the National Association of Realtors reflect similar trends. For example, nationwide, 65% of people believe now is a good time to buy a home. Additionally, 73% of people believe it’s a good time to sell a home.

“Buyers are thrilled with the recent decline in interest rates allowing them savings and more purchasing power,” notes Kim. “Sellers may have concerns over the increase in days on market and increasing inventory, causing them to sell now rather than later.”

Usually, supply and demand conditions can be categorized as either a buyer’s market or a seller’s market, yet today, both buyers and sellers have opportunities in this market.

“This market is unusual in that we have been in an expansion market for almost a decade,” says Kim.

On the other hand, the Honolulu Board of Realtors reports this week the number of active listings has reached a two-year high in both single-family and condominium segments. The number of active single-family homes on the market hit 1,588 last month, up 16.7% from June 2018, when the inventory level was 1,361. Condominium inventory on the island was up 13.8%, from 2,123 a year ago to 2,417 units for sale in June.

Considering the pace of sales, the months of inventory remaining data has been on the rise —tracking consistently above 3 months of inventory — since January. The last time both single-family and condominiums showed 3-plus months of inventory remaining was August 2016. Last month, the MRI in both categories hit two-year highs — 3.6 months of single-family home inventory, and 3.9 months of condos.

Sales of Single-Family Homes and Condos | June 2019

Source: Honolulu Board of REALTORS^®, compiled from MLS data

Overall, there were fewer transactions that closed in June, as compared to June 2018.

Single-family homes sales dropped 10.4% — from 365 in June 2018 to 327 last month. Year-to-date, the overall drop is less severe, down 3.7%.

Condo sales were reported to also have slackened. The tally of condos closed was 473 in June — down 13.5% from sales a year earlier. Through the 2019 second quarter, condo sales are down 8.8% from 2018 figures.

Median Sales Price of Single-Family Homes and Condos | June 2019

Source: Honolulu Board of REALTORS^®, compiled from MLS data

Despite the increase in inventory and decrease in activity, the median sales prices ticked up in June.

The MSP for single-family homes in June hit $800,000, only the fourth time MSP has broken the $800,000 mark — since August, September and October of 2018, when the SF MSP was $810,000, $812,500, and $800,000, respectively.

Condominium prices were also up 3%, from $420,000 a year ago to $432,500 last month.

It is worth noting that the year-to-date median sales price is down across the board with single-family prices down 0.5% , and condo prices dropping 1.4%.

HOT MARKETS!

This month’s hot markets are those neighborhoods where sellers are receiving 100% or more of their asking price.

According to Kim, “Each neighborhood is a bit different. Some neighborhoods are still experiencing low inventory, causing buyers to compete for those homes.”

They include: