Oahu real estate update

October 15, 2009 by
Filed under: Hawaii, Home Searches 

oahuLocal economist Howard Dikus reported on his webpage that military construction and spending dollars has helped to stabilize the Hawaii real estate, especially on Oahu, by ensuring dozens of transactions and property purchases every day.  However, there was good news to report: “After predicting that Oahu median home prices would fall nearly 5% in, now the forecast is for a decline of less than half that much.”  Another glimmer of home was the end to a long-time slowing of home sales in July.  The “rebounding number of sales was also bottoming out prices as well.”

Oahu real estate has fared much better than the other neighbor islands, reported Allison Schaefers of the Honolulu Star-Bulletin.  The September 16, 2009, article claimed that “Oahu posted 302 foreclosures in August, or one per every 1,109 households.”  However, this doesn’t mean Oahu was completely immune to disastrous foreclosures.  Ewa Beach posted 65 foreclosures in the month, making it the third-worst zip code in the entire Hawaiian island chain.  In fact, “Kapolei, Mililani, Waianae, Kaneohe and Waipahu also posted high activity.”  For these reasons, real estate on Oahu has become especially volatile and reactive to just slight changes in the market.  Interestingly, in light of these depressing statistics, 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.

oahu2The number of Oahu homes for sale has risen due to a number of factors, among them the dwindling rate of vacation renters.  According to the PR Newswire on September 23, 2009, occupancy rates of Oahu vacation rental homes dropped to sixty-one percent, based on the top 2, 373 vacation homes and condos operated on Oahu.  The lowest occupancy rate was 40% in February while the peak of summer saw 80% occupancy – a time when most rentals are usually booked to full capacity.  As more homeowners who previously rented out their properties for short-term stays, they are finding it much better financially to sell the home outright instead of worrying about an erratic income from renters.

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