Market conditions favorable for sellers as state reopens

While the total number of home sales were down, as well as median prices for both single-family and condominiums when comparing June figures with June 2019, month-over-month, short-term comparisons — May to June 2020 — indicate our market showed improvement as the state reopened.

 Shopping malls, beaches, restaurants, gyms, golf courses, movie theaters, bowling alleys, museums, dog parks, hair salons, and other businesses reopened in May and June with appropriate COVID restrictions. Real estate guidelines also loosened, allowing Realtors® to conduct open houses and show property to groups of no more than 10 people.

“We have observed a steady increase in real estate activity as residents become more comfortable with venturing out of their homes and resuming normal life,” says Kalama Kim, principal broker at Coldwell Banker Pacific Properties.

“The month-over-month improvement indicates our market is steadily strengthening as the state reopens,” says Tricia Nekota, president Honolulu Board of Realtors®. While low interest rates make buying appealing to buyers, sellers continue to see pent-up demand and low inventory as advantageous conditions to sell.

While recent spiking of the outbreak may derail the state’s planned reopening and future positive effects remain somewhat speculative, there are other market conditions that suggest bright spots, especially for sellers.

“Single-family home sales are significantly outpacing condo sales,” according to Kim. “This could be a result of a drop in buyers interested in second-home and investment properties, and may be hesitant to buy knowing there are restrictions on travel to Hawaii.”

At least for now, prices remain steady, even year-over-year.

The frequent question on the minds of would-be sellers: Should I sell now or wait?

“During this unique time, we don’t know what the future holds,” Kim says. “However, we know that in today’s market, many sellers are selling quickly, receiving multiple offers, and getting close to or above their list price.”

Sales of Single-Family Homes and Condos | June 2020

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

Fewer homes and condominiums sold in June, as compared to June 2019.

Single-family home sales dropped 7.6% — 327 homes closed a year ago, versus 302 last month. Year-to-day single-family home sales statistics through the second quarter are off by 4.8%.

Condominium sales have tumbled. In June 2019, 473 condos closed on Oahu. Last month 312 units closed — plunging 34%. Year-to-date condo activity is also glum — down 22%.

Pending sales show a tick up in SF homes last month — the largest percentage of which are priced between $650,001 and $1.1 million. 

Median Sales Price of Single-Family Homes and Condos | June 2020

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

The median sales price of a single-family home and of a condominium fell slightly in June, but remain up when comparing year-to-date MSP at the end of the first six months of 2020 versus 2019.

In June 2019, the MSP of a SF home was $800,000. The MSP fell 3.8% last month to $770,000. However, YTD 2019, the median sales price was $775,000, compared to $785,000, the YTD figure this year.

Condo prices followed suit. Last month, condo MSP’s were down 2.5% — from $432,500 in June 2019 to $421,500 last month. But YTD, the 2019 median sales price was $419,000, compared to the YTD figure this year of $427,750.

After the first six months of 2020, and including three months during the pandemic, median prices remain steady.

NEIGHBORHOOD MARKET STANDOUTS

Significant decreases in inventory, pending sales, and closed sales, kept Oahu prices stable. Our island has a longstanding shortage of housing, but recently, the low inventory is compounded by the pandemic, which has prompted some sellers to pull their properties temporarily off the market.

Fewer listings (reduced supply) increases demand, and may be an opportunity for would-be sellers to list now — while prices are strong.

This month’s market standouts, are the neighborhoods where inventory in May dropped by more than 30% (and for condos, by more than 25%).

Single-familyMay 2020May 2019% Drop
Ala Moana—Kakaako23-33%
Ewa Plain165246-33%
Makakilo3571-51%
Mililani3281-60%
Pearl City-Aiea5385-38%
CondoMay 2020May 2019% Drop
Hawaii Kai6691-27%
Mililani6193-34%
Waialae-Kahala1127-59%


SOURCE: Honolulu Board of REALTORS® , compiled from MLS data.

By |2020-07-17T17:07:37-10:00July 17, 2020|