I’ve been seeing a lot of recent headlines about the real estate market being the only bright spot in the otherwise negative economic reporting. I’ve also heard many of my colleagues say the market is HOT! Yes, all caps and exclamation point. We are seeing many instances of multiple offers and homes going into escrow over list price within the first week of listing. Yesterday the Honolulu Board of Realtors (HBR) posted the Oahu Monthly Housing Statistics Report for July 2020. I thought I’d take a look to see what the objective numbers say about the Ohau real estate market.
The positive trends of the past couple of months have continued, which is great news. Inventory levels in both condo and single family segments continue to be an issue. Fortunately, a combination of pent up local demand, the return of military rotations, and low interest rates are driving demand. That low level of inventory combined with increased demand is driving increased prices in many of our markets. Despite the impacts of the pandemic on our market, the median prices for both single family homes and condos are slightly above this time last year when comparing year to date numbers. Single family median prices are up 0.6% and condos are up 1.2%. Pretty good considering the circumstances.
Last month I said it’s too early to call it a positive trend with any of the statistics, but the numbers are continuing to improve. I still feel strongly that performance going forward will depend on the timing of tourism and the general economy getting back on track, especially as the number of COVID19 cases are increasing in Hawaii and many other states. The end of government subsidization of the economy (CARES Act, PPP, PUA) as well as the potential wave of evictions and cloud of forbearance resolutions are still looming on the horizon. Unless congress can agree on a relief package going forward, we may see a reverse in these improving trends.
Honolulu Board of Realtors Executive Summary
The O‘ahu real estate market is experiencing incremental month-over-month gains in closed sales and new property listings, though year-over-year activity remains down. Pent up demand, low mortgage rates and low inventory continue to drive market activity.
Despite a 3.0% slip in sales for single-family homes compared to this time last year, sales of single-family homes surpassed the average monthly sales for 2019 by 15.3% and marked a 19.5% increase compared to June. Sales of homes in the $700,000 to $899,999 range were up 19.4%, but homes in the $600,000 to $699,999 range saw a 26.5% decrease in sales. The demand for single-family homes remains high with properties spending a near record low median of 13 days on the market.
Condo sales dropped 17.0% compared to last July, while month-over-month sales activity continues on an upward trajectory with a 36.5% increase in sales compared to June 2020. Overall, there was a decline in sales volumes for condos at most price ranges, except for condos in the $400,000 to $499,999 price range, which marked a 20.7% uptick compared to this time last year.
New listings for single-family homes and condos were down 18.8% and 15.6% respectively; however, compared to last month, new listings for single-family homes and condos are up 7.7% and 9.9% respectively.
While the year-over-year median sales price of single-family homes and condos for July dropped slightly, the year-to-date median sales price inched up 0.6% to $790,000 for single family homes and 1.2% to $430,000 for condos.
We are seeing signs of increased activity driven by eager buyers looking to take advantage of record-low interest rates coupled with sellers who are slowly wading back in to put their properties on the market. This real estate activity indicates confidence in our local housing market and contributes to the recovery of Hawai‘i’s economy.
To see the full report, click HERE. I’m also trying something new with a video summary below. Check it out and let me know what you think.
As always, a reminder that statistics vary by neighborhood, building, and price bands. If you have questions about your home, building, or neighborhood, please fee free to contact me.