The month of September showed promising signs when compared to the same month last year. Overall, the island of Oahu saw a 13.5 percent increase in single-family home sales and an increase of 13.1 percent for condominium sales.
In the month of September, Kapahulu-Diamond Head through Hawaii Kai experienced an increase of 23 single-family home sales when compared to September, 2008. Eighteen of these sales were in Hawaii Kai, bringing the Hawaii Kai median single-family home price to $830,000, up from $665,000 one year ago. The past few months have also shown a change in available inventory. Currently, East Oahu has approximately five months of inventory remaining, should no other new listings enter the market. Just a few months ago, inventory levels were above six months and at this point last year there were nine months of remaining inventory. This translates into 1,246 fewer listings in 2009 than the in first nine months of 2008.
Lawrence Yun, chief economist for the National Association of Realtors, says that though Hawaii home sales are at a 10-year low, it can be explained in part “by stricter mortgage underwriting guidelines. In addition, Hawaii suffers from the credit freeze that is taking place in the jumbo market and for second home purchases.” Yun also adds, “consumer psychology appears to be decisively turning for the better as the housing market has been showing signs of bottoming, if it is not already past a bottom point. Affordability conditions are now at multi-year highs thanks to lower home prices and very low mortgage rates on conforming mortgages.”
Going Forward
The first quarter of each year is historically the slowest in terms of sales. Taking into consideration the approximate one and a half months it takes to close and transfer ownership in a property sale, the buying activity can be backtracked to the fourth quarter of the previous year. With the end of the fourth quarter being the busy holiday season with most consumed with family, friends, shopping and cooking, it typically creates a lull in buying and selling activity.