The Oahu Real Estate Market in 2025: My Honest Take

 

Every year I write a version of this post. Every year people are surprised that I'm willing to say things that don't necessarily benefit me. Here's the thing: my job is to help you make a good decision, not to convince you the market is perfect for buying or selling regardless of reality.

So here's my honest take on what the Oahu real estate market looks like in 2025.

 

The Good News: We Avoided the Crash That Never Came

For the past two years, people have been calling me asking when the Hawaii market is going to crash. The short answer: it's not crashing. Here's why. We have a structural supply shortage that doesn't go away when mortgage rates go up or the stock market wobbles. There are more people who want to live in Hawaii than there are homes available. That equation has been true for 50 years and there's no sign of it changing.

Yes, the pace of sales has slowed. Yes, prices have come off their 2022 peaks in some segments. But "the market slowed down" is not the same as "the market crashed." Sellers who are priced right are still selling. Buyers who are ready to move are still finding opportunities.

 

The Honest Challenges

Mortgage rates remain elevated compared to the sub-3% era that ended in 2022. This has reduced purchasing power for buyers significantly. A buyer who could afford $1.2M at 3% can now afford roughly $900K at 7%. That's a real squeeze.

This is creating a lock-in effect — sellers who bought or refinanced at low rates don't want to give up their rate to move, so they're staying put. This suppresses inventory further, which keeps prices from dropping much.

The net result: a slower market with fewer transactions and limited inventory, but prices that are stubborn on the downside.

 

Where Are the Opportunities?

I'm seeing opportunities in a few specific places:

New construction — Particularly in Ho'opili and Hoakalei in Ewa Beach. Builders are offering interest rate buydowns and incentives that effectively lower your rate. In some cases, you can lock pricing now and close 12-18 months out, betting that rates come down before you move in.

Older condos — The condo market on Oahu is more nuanced than single-family. Buildings with high maintenance fees, older infrastructure, or pending special assessments are sitting longer. For cash buyers or well-capitalized buyers who don't mind some renovation, these represent solid value.

Estate sales and motivated sellers — In every market, there are sellers who need to move. Death, divorce, job relocation. These sellers are willing to negotiate, and right now there's less competition from other buyers than there was two years ago.

 

My Advice for 2025

For buyers: Stop waiting for a crash that isn't coming. If you can afford to buy, buy. Renting in Hawaii is nearly as expensive as owning in many cases, and you're building someone else's equity. Find the right property in the right neighborhood, and make a smart offer.

For sellers: Price correctly from day one. The days of testing the market at 15% over value and expecting multiple offers are mostly over. An overpriced listing sits, becomes stale, and eventually sells for less than it would have with a smart list price. I can help you find the sweet spot.

Questions? Call me at the number on the top right of the site. I'm always happy to give you an honest read on your specific situation.