Mortgage interest rates dip to lower levels in nearly 15 months

The welcomed news of lower mortgage interest rates — the lowest in nearly 15 months — will provide qualified buyers lower, predictable monthly payments and more buying power in a market where affordability is a challenge.

Yet despite months of high mortgage rates and rising insurance costs, the median sales prices of homes and condos on Oahu are up from a year ago. Year over year, single-family home prices have bounced up 4.6% and condo prices are up 1.8%.

Sales volume in single-family sales is up 20.1% from July 2023, while condo sales have slowed by 7.8%.

In the latest report from the Honolulu Board of Realtors®, it was noted that both single-family and condo segments experienced a decrease in the number of sales that closed above the original asking price. Last month, 29% of single-family homes sold for more than the original asking price, compared to 36% in July 2023. Similarly, last month, 15% of condos had sold prices that were higher than the asking price, down from to 25% last year.

There is evidence of strong demand for real estate based on the number of days properties are on the market. Last month, single-family homes on Oahu sold at a pace similar to last year, with July sales reflecting 15 median days on the market — one day quicker than the median last July. However, the median days on the market for condos was nearly twice as long as July 2023 — increasing from 16 days to 30 days.

Overall, inventory continues to rise on Oahu. By the end of July, there were 722 active single-family home listings and 1,867 condo listings. Compared to the same period last year, single-family inventory has increased by 22.2% and condo inventory 61.8%. This growth in inventory applies to most price points. More inventory gives buyers more options.

With mortgage rates falling, buyers can ask their loan officer to re-crunch the numbers.

“The recent rate decrease is encouraging and can definitely make a significant impact on buying power,” says Mike James, president of Coldwell Banker Realty. “Home buying efforts have been energized this week. Yours could be next.”

Sales of Single-Family Homes and Condos | July 2024
Source: Honolulu Board of REALTORS^®, compiled from MLS data

Sales volume data was mixed in July. Single-family sales shot up 20.1% — from 224 in July 2023 to 269 homes closed last month, while condo sales dropped 7.8% — from 422 in July 2023 to 389 last month.

According to the HBR, who report mid-month on details of specific neighborhoods, single-family home sales in Makaha-Nanakuli jumped up 37% in June, while home sales in nearby Ewa Plain fell 18%. Most homes on Oahu sold quickly — in a median of 15 days — except in Kalihi-Palama, North Shore, Makakilo, Windward Coast, and Makaha-Nanakuli, where the days on the market exceeded 30 median days.  Condo sales volume reported the most significant slump in Waikiki, where HBR reported 67 condos closed in June — a 48% year-over-year decline. Condos in Mililani tripled the days on the market year-over-year to 48 days.

Median Sales Price of Single-Family Homes and Condos | July 2024
Source: Honolulu Board of REALTORS^®, compiled from MLS data

Perhaps the most consequential evidence of strong demand is prices, which are up across the island again in July.

In July, the median price of a single-family home increased by 4.6% to $1,140,000 from $1,090,000 in July 2023. Additionally, the median price of a condo in July also rose by 1.8% to $509,000 from $500,000 in 2023.

Year-to-date, MSP of a SF home is up 4.8% to $1,100,000 from $1,050,000 in July 2023. YTD condo MSP is up 2%, from $500,000 in 2023 to $510,000 last month.

NEIGHBORHOOD MARKET STANDOUTS

This month’s spotlight is on Oahu’s more affordable neighborhoods. Specifically, where homes and condos remain near or below Oahu’s median sales prices. Check it out.

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

For an up-to-date market analysis of your property, contact Coldwell Banker Realty today. We are happy to provide you with a current valuation on your home.