Oahu Prices Heading for Another All-Time Year High
Spurred on by low mortgage interest rates, the market continues its upward trend and shows little indication of slowing anytime soon. Since 2012, the annual median sales price for a single-family home has gone from $620,000 in 2012 to $650,000 in 2013 and up to $675,000 in 2014 — surpassing the peak bubble year of 2007 when the median price was $643,000. Condos too are keeping pace with year-over-year single-family stats.
This year’s summer selling season year-to-date prices are heading for another all-time high. Buyers, even first-time homebuyers, are competing for available inventory, evident by the bidding wars we see in many neighborhoods and on well-priced listings.
“I would describe the market as red hot, as the average days on market for homes that sold last month was just 16 days — the lowest in over a decade,” adds Kalama Kim, principal broker at Coldwell Banker Pacific Properties.
In addition to lightning-fast sales, other market stats are sizzling as well. Pending sales, which show homes and condos in escrow but haven’t closed yet, are also on the rise. Single-family pending sales are up 14.4%, from 416 a year ago to 486 last month. Condo pending sales are up 10.2% in July, from 581 in July of 2014, to 640 last month.
“Even though the Federal Reserve has threatened increased mortgage rates later this year, the rates have remained below 4%, allowing buyers to afford the rising home prices,” says Kim.
Inventory was up in both categories — single-family home active listings were up 6.1% to 1,331 listings island-wide, and condo listings were up 12.6% to 2,040 — and are two-year highs. However, the months of inventory remaining of 3.3 months and 3.7 months, respectively, indicates there is little inventory to meet demand and is well short of the 6 to 9 month figure deemed a healthy market for both buyers and sellers.
“The market has continued its strength through the summer. Pending sales in July are up 14.4% for single-family homes,” says Kim. “Closed sales are up, year-to-date through July, by 4.8% for homes. (Year-to-date, 1,925 single-family homes closed, compared to 1,837 through the end of July in 2014.)”
In July, the number of single-family transactions that closed was 337, compared to 300 during the same month a year ago — a 12.3% increase. Condominiums sales volume is also up. Last month, 501 condos closed on the island — a 12.8% increase over last year when 444 units closed.
The median price of a single-family home on Oahu remains in record-breaking territory in July — at $710,000.
“In addition to the jump in pending sales and closed sales, home prices continue to rise as the median sales price for single-family homes jumped to $710,000 in July, which is the second highest mark for Oahu’s home sale history,” says Kim.
The record, all-time high for one month, was set in November 2014, stands at $719,500.
Year-to-date, the median price of a single-family home is at $690,000, up 2.3% from the median of $674,700 at this point last year.
Condo prices were down slightly this month — from $351,750 a year ago, to $350,000 last month. However, year-to-date condo prices are up to $359,000 — up 2.6% from the MSP last year of $350,000.
With median prices inching closer to the million dollar mark, this month’s hottest markets are those neighborhoods which met or broke the million dollar price tag in the year-to-date 2015 tally.
Single-family homes in:
Aina-Haina – Kuliouou: $1,060,000
Ala Moana – Kakaako: $1,217,500
Hawaii Kai: $1,050,000
Kailua – Waimanalo: $1,005,000
Makiki – Moiliili: $1,175,000
Waialae – Kahala: $1,780,000
Also worth mentioning, Wahiawa was the stand-out neighborhood in June for a couple of reasons. First, the median price of a condo in Wahiawa hit a two-year high — at $195,000. Additionally, sellers in Wahiawa typically received more than their asking price. Single-family sellers in Wahiawa received 106.1% of their asking price, and condo sellers in the neighborhood received 98.2% of their asking price.