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John Harris (R), CRB
Shelly Campbell (R)
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The Home Team is proud to present our outlook on real estate in 2000, as published in the February 2000 California Association of REALTORS monthly magazine, and the RE/MAX of California & Hawaii Financial Report: HONOLULU REAL ESTATE MARKET OVERVIEW: 2001 AND BEYOND... by John Harris, President, RE/MAX Honolulu The news from Hawaii is upbeat. Reflecting the economic strength on the mainland and the strengthening Asian economies, the Hawaiian real estate market is doing better than it has done in quite awhile. Oahu
has seen twenty-nine straight months of growth in the annual
housing sales rate, and shows few signs of slowing down. As of the end of the third quarter of 1999, overall Oahu
property sales were up 23%
year-to-date than as of the same time last year.
Additionally, there is finally some positive news on the
price front, as Oahu median single-family home prices are up a
modest 0.8%, and condominium median sales prices have also
increased, now up nearly 0.4% compared to last year.
Comparing these values to the lower second quarter 1999
prices reveals even better performance, as single-family and
condominium prices were up 3.3% and 6.4% respectively, likely
signaling that the second quarter represented the bottom of the
extended price doldrums and that we have probably turned the corner
in the current real estate cycle.
While indicators in the Oahu real property market are
positive, Hawaii’s weak economy is still a major concern, with
little job and income growth present in the island business climate.
An
interesting phenomenon in the Hawaii real estate market has been the
lead by the resort markets of South and West Maui, as well as the
Kohala Coast of the Big Island, in higher end property transactions
per capita. Honolulu,
which on the island of Oahu boasts the state capital and more than
85% of the state population, has been slower to recover from the
malaise after the crash of Asian financial markets as property
buyers from westbound sources have first gravitated toward the
neighbor islands instead. This
trend appears to be turning, however, as higher property prices on
Maui and the Big Island, combined with the more numerous cultural
and entertainment activities available on Oahu, home of the
nation’s eleventh largest city, which combine to make Honolulu
more appetizing to Hawaii real estate buyers. Focusing
on the million-plus market on Oahu, the first nine months of 1999
have shown that 46% of such buyers have originated from the
mainland United States, primarily from the West Coast.
Many of those buyers are seeking “second homes” and
condominiums to enjoy as the widespread prosperity enjoyed by many
mainland Americans, combined with the lure of the Aloha State.
Local buyers constitute 35% of the million-dollar sales since
January, with only 11% representing international addresses.
It is quite evident that California’s frenetic pace in its
own real estate markets has finally shown up in the islands, with
multiple offers and settlement prices higher than original asking
prices now becoming more commonplace. As
evidenced by the substantial amount of external investment in the
higher end properties in Hawaii, we look to 2001 to bring some
additional prosperity to the stagnant island economy to spur real
estate sales even higher. |
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