Hawaii real estate update

October 5, 2009 by
Filed under: Hawaii, Home Searches 

hawaii“Hawaii’s home prices have been slipping for the last year but we’re still the most expensive housing market in the country.”  That was just one of the headlines of local television news station KGM9 News on September 22, 2009.  With the median value of a single-family dwelling settling at about $560,000, analysts place the pricing of many Hawaii homes for sale in line with other prestigious markets in Washington, D.C., San Francisco, and even some of the pricier neighborhoods in Los Angeles.  The report even stated that “Hawaii’s median home price is $86,000 more than the Washington D.C. median, which was ranked 2nd highest.”

hawaii2The notion of still high real estate prices in Hawaii has been confirmed by a variety of sources.  Real estate in Hawaii was mentioned in Randi Petrello’s September 23, 2009, article in the Pacific Business News when stating that the average sales price for a “four-bedroom, two-and-a-half bath house in Honolulu in 2009 was $712,500, well above the national average of $363,401.”   Apparently, “the most affordable houses in Hawaii are in Kihei on Maui, where a four-bedroom costs an average of $540,044.”  Interestingly, Jessica Holzer wrote in the Wall Street Journal on September 23, 2009, that the FHFA monthly index, calculated using purchase prices for homes backing mortgages by Fannie Mae and Freddie Mac, climbed 1.6% in Hawaii while most other regions saw declines between 0.3% and up to three percent.

Local economist Howard Dikus reported on his webpage that military construction and spending dollars has helped to stabilize the Hawaii real estate by ensuring dozens of transactions and property purchases every day.  He also stressed that Hawaii is not out of the woods, yet.  In fact, median home prices continue to be very fluctuant, although not nearly at the drastic rate that was predicted earlier.  While many people are afraid to enter the Hawaii market now, it may be the best time as homes are sometimes selling at significantly discounted prices.  The problem typically is that prospective buyers are ready for the significant different valuation.  Many mainland buyers are used to paying small amounts for large, beautiful houses while many properties in Hawaii sell for much more and only include a small, old cottage.  Overcoming this variation in expectation is a key component to increasing the rate of home sales in Hawaii.

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