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The reality is Waikiki is keeping the price up on Oahu. There are still those with money buying up cheap (or cheaper) condo's for vacation rentals etc. If you take a look at any breakdown you will see that Waikiki has not dropped as much as the rest of Oahu.
While I agree Waikiki is helping keep condo prices high, I expect this to change. The total number of condo sales in the 1stQ of 2009 is down 45.3% (island wide) from the 1stQ of 2008. The total number of units for sale in waikiki is well over seven hundred. This is a sure (well, maybe not sure) sign that prices should start falling in Waikiki and elsewhere.
Hawaii Real Estate Central - Honolulu Board of REALTORS (http://hicentral.com/hbr-stat.asp - broken link)
If we do in fact see a big correction in the housing market, I expect the pricier locations to be the last to bottom out, if they do. These areas include: Waikiki (for condos), Kahala, Waialae, Aina Haina, parts of Hawaii Kai, Lanikai and other parts of Kailua (beach), Manoa and Kaimuki.
We have seen a lot of decay in the following areas: Makaha, Waianae, Maile, Nanakuli, Kapolei/Makakilo, Ewa, Ewa Beach, Royal Kunia and to a lesser extent Central Oahu to include Wahiawa, Whitmore Village and Mililani.
Prices are pretty much dropping island wide (some a little, some a lot), but now we are also seeing the housing market decaying in parts of Kaneohe, parts of Kailua and parts of Hawaii Kai, specifically Koko Head Terrace. Many are now listed below 750K.
Prices have been dropping in Waipahu (including the subdivisions of Waikele, Waipio, Village Park, Seaview and Crestview), Pearl City, Aiea and parts of Metro Honolulu.
Short sales (also foreclosures and lender sales) are just about everywhere, but their increasing in areas that I also thought were stable markets. Kaneohe and Kailua come to mind. Strap yourselves in, it could get REAL interesting.
Another forum member shared this website with me. Its far and away the best site to research real estate on Oahu. It has EVERYTHING! The site updates every 10 minutes or so.
Its really hard to say. Of course, this is just my prediction, but I don't see Oahu's housing prices increasing for 5 years or more. If tourism and the building industry don't improve in the next few years, I really think housing prices will remain low for an extended period of time. The idea of buying a house in Waipahu for 300K, or a house in Kaimuki seemed crazy two years ago. Maybe in a few years this will be what we see.
In some ways its a bad thing. On one block you could have three houses that appear to have equal value, but depending on when they were bought, the appraised values could be 725K (bought in 2005), 400K (2012) and 300K (bought in 2000). Yikes!!!!
In some ways its a bad thing. On one block you could have three houses that appear to have equal value, but depending on when they were bought, the appraised values could be 725K (bought in 2005), 400K (2012) and 300K (bought in 2000). Yikes!!!!
That is absolutely true!...this I believe is the problem that we are starting to face now...which makes buyers nervous. If they buy a home for $400,000 and next week their neighbor puts theirs on the market (same type of home in size etc.) for $350,000....your market value just went down by $50,000.
Its hard to say, but according to the website oahure.com, many listings are dropping their prices and most homes are selling below listed prices.
The question is are more properties selling in the high end market or the battered markets in Leeward, Ewa and parts of Central Oahu. My guess is the prices will report a drop for April. How much, I'm not sure.
Lopaka, how low do you think Oahu's average sales price (not median listing price) for a single family home will fall to? And, how long do you think it will take?
It's hard to say, but I know fer sure the economic decline has only just begun. We have yet to experience the commercial real estate and U.S. Bond Market bubbles to burst. And those are gonna hit real hard. You ain't seen nothin yet. Unemployment will likely reach 25%. We're already more than halfway there. Use this knowledge to make your own housing market forecast, and then prepare for conditions that are even worse.
I sound like a fatalist, but I consider myself a realist. Optimism can't overcome facts and the situation that we're in. Numbers don't lie, and we can't positively feel our way out of this one. Not this time.
It was only a few years ago that median house prices were somewhere in the $375K range. According to some experts, median income levels are below 1999 levels when accounting for inflation. I wouldn't doubt that median house prices will fall below $350K in the next few years. Perhaps even sooner. To me, the wild card are the rich, out-of-state people who may keep housing prices higher than normally expected. No matter how bad things are, there's always some billionaire, like that Ginshu Kawamoto guy, who'll buy everything up and hold onto their real estate, cuz they need a place to throw their money.
I saw a Youtube clip where a guy charted the pattern of the Great Depression starting in 1929. He then ran a comparison of how the economy was doing today by overlaying the two charts. The pattern was frighteningly identical. According to the chart, we're experiencing a market rally after the initial fall in October "08, and the DOW may creep back up to the 9,000-11,000 level, followed by the Big Fall. In 1929, the Big Fall occurred in the 4th quarter. World reknown economist like Marc Faber and Jim Rogers, among others, are forecasting a currency crisis by this fall.
My advice from them? Pay off your debts as much as you can, except your mortgage, and don't buy anything you don't need. True wealth is determined by your net worth (savings), not on how much you borrow (debt).
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