You may have noticed that home prices are increasingly rising in Hawaii. Sellers are receiving multiple offers and backup offers due to low inventory. This has resulted in above asking price offers. Lets talk about how real estate is expected to be affected in 2015. Or rather, how it will affect you as a homeowner and/or a buyer. 

Photo: Hoakalei master planned community 

   The median home price (on this rock, Oahu) has steadily risen in the last 5 years, since the bubble burst. (which I might add, only affected home prices minimally in comparison to our mainland comrades) It is currently at $690K and economists believe that by 2020, the median home price on Oahu will be $1M. Some even believe that it could double by then. 

Photo: Sunrise in Kailua/Lanikai

   During the last surge in home values back in 2005-2006, local lenders stayed conservative, that helped Hawaii homeowners hold onto their homes, and protected our home values as well.  We only saw a 3% drop in 2008, 7.9% drop in 2009 and then in 2010, prices started to slowly rise again. This shows the true strength of the Hawaii housing market.  

 The housing market went up 3.8% for single family homes, and 5.4% for condominiums this last year alone. Supply and demand play a big part in our market, that along side with living in a beautiful place with a perfect climate. This makes it increasingly more difficult for non-homeowners, but specifically younger people, to become homeowners, which then drives up rental rates as well. But despite new home development on the Ewa plain and in Kakaako, the inventory is still low. Average time on the market has also gone down each year.

Photo: Hawaii Kai to Diamond Head from the summit of Koko Head Crater

   You may think that as a buyer, your going to experience the downside of the Hawaii market, well not so much. Experts at the Honolulu Board of Realtors say that if you jump in, and take advantage of low interest rates now, you will profit in the end.  Interest rates still remain low, which helps buyers attain higher loan amounts. There are also many options for buyers here, like USDA 100% loans, VA loans and even seller financing. 

    But many Realtor's agree: Buyers, be prepared to meet or exceed asking prices. Be completely pre-approved with a lender before making any offers.  Your agent may want you  to send a letter about yourself/your family to get the sellers attention on your offer. And most importantly, be prepared to move fast! 

   If you're starting to build your real estate portfolio or expanding it, purchasing in Hawaii can be a safe move for you....
Where do you want to be in the year 2020?    

By: Chelsea Pferschy RS# 76072

The median home price in Honolulu reached a record high of $719,500 in November. This exceeds the summer high ($700K in June '14) and reflects a 5% increase over last year. This year-end peak follows a $50,000 drop in median home price between June and August.

Three months ago, I wrote an article in which I highlighted a notable trend in Honolulu real estate, making two main observations:

1. That median prices tend to take a dip in the autumn, between highs in the summer and winter
2. That the end-of-year peak will likely surpass the summer peak.

Here's an excerpt from that September post:

"In two out of the last three years, the median price in the winter exceeded the previous summer high. While we can't say with certainty that the median price this December will be higher than $700k, it's a safe bet to say that it will be higher than August's $650K."

And so the trend holds. I created the chart below so you can see the ebb and flow from 2011 to 2014.

Median Sales Prices on Single Family Homes (Oahu)

Confidence for sellers and buyers

This is encouraging news for both sellers and buyers.

Sellers can take confidence in the fact that Hawaii's real estate market is still going strong. "The demand for homes continues to outpace current inventory levels." said Honolulu Board of Realtors President, Julie Meier. More demand than supply means higher prices and therefore, more money for the seller.

Buyers can also take confidence in the strength of our market. When the cost of a commodity rises, so does its value. For instance, the higher the price of gold or oil, the more valuable it is. Similarly, as home prices have been on the rise in Hawaii, we have seen a corresponding rise in home values. The trend of a healthy annual increase in Hawaii home value is good news for future home owners, as owning Hawaii real estate remains a solid opportunity to build wealth.

Importance of finding a good realtor

But how important is it really to track trends? Not nearly as important as finding a knowledgable realtor -- especially in a unique market like Hawaii. Good realtors are able understand trends and act accordingly. For example, on a recent sale, our buyer's offer beat out three higher priced offers on the same home.

What made our lower-priced offer stronger than the others? We included an appraisal clause in our offer (which none of the other agents did for their clients). Upon hearing that all offers were over asking price (as would be ours), we asked our buyer if they would be willing and able to furnish cash to cover the difference if the appraised value came in under their offer price. If so, the seller wouldn't have to worry about the deal falling apart because of the loan.

In the end, the appraised value matched our client's offer price! And because there was no difference, the loan was funded with no hiccups and our client never had to bring in the extra cash we referenced in the contract.

What does this have to do with the rise in median home prices?

We didn't just get lucky. We saw the trends and anticipated that the home was worth more than what the seller was asking. In light of this, we let our client know his options and the associated risks, equipping him with the information he needed to make a confident decision -- a decision that paid off in the end.

But it all starts with one decision: which real estate professional will you choose?

Kuapapa at Hoakalei is comprised of 4 collections (price ranges)  that all have customizable floor plans in variable price ranges.

Loulu-  the Loulu collection of charming seaside-style cottages have 4 plans that start in the $600's. Residence 25.10, 25.20, 25.30 and 25.40 range from 1628-1864 sq ft. They  include three or four bedrooms, and an available main floor master suite.

Naio- The Naio collection is in the same vein as the Loulu collection, with a bit more space and more refined interior finishes. There are 4 plans that start in the mid $700's. Residences 45.10, 45.20, 45.30 and 45.40 range from 1,997 to 2,381 and have four to five bedrooms and up to three full baths.

 

Koa Lifestyle series- The Koa collection features 2 floor plans, both with attached 2-car garages. This collection starts in the mid $900's and has between 2545 sq ft (65.10 plan) and 2612 sq ft (65.20plan), and both have 4 bedrooms and 3 baths. These 2 home plans have a free flowing, open 'great room' layout. 

Koa Premier Series- This is the top of the line series in Kuapapa-Hoakalei. It consists of 5 plans that start in the mid $900's and go up to $1.1M+.  Residences 60.10, 60.20, 60.30, 60.40 and 60.50 are between 2123 sq ft and 3552 sq ft, with 3, 4 and 5 bedrooms, and 2.5, 3.5 and 4.5 bathrooms. They tout large open, great room layouts, with opulent master retreat and bathrooms. They also, all have attached 2 and 3 car garages. 

With home ownership in Hoakalei, you get privileged access to the new Wai Kai Hale Club and the planned neighborhood pool and spa. The Wai Kai lagoon, when finished, will be the largest manmade body of water in Hawai'i. The Wai Kai Lagoon is envisioned to be the centerpiece of the resort district and they hope to make this neighborhood a one stop shop for finicky "2nd home" and "resort home" buyers on the west side of Oahu. 
There will be a neighborhood pool/spa and playgrounds. The Wai Kai Hale Club will be on the shore of the lagoon, there you can gather with friends, BBQ or launch your kayaks, paddle boards, and surf boards. The Hoakalei Resort, designed by Haseko Development, Inc., is a 726 acre master planned destination community and currently includes an 18-hole Ernie Els designed champion golf course.

Call Team Aloha Tony, for independent and personal representation and assistance in finding the new home of your dreams at Kuapapa, Ka Makana, and Kipuka at Hoakalei, today.

-Chelsea Pferschy RS# 76072

(808) 754-6000

Check out our new Ocean Pointe listing in Ewa Beach! This immaculate 5 bed, 3 bath shows like a model home and has over 2700 sf interior living space. Upgrades include plantation-style shutters and built-in desks and closets. 

Built in 2006, this Ocean Pointe home is located just a mile away from the brand new Laulani Village Shopping Center, where you'll find Safeway, Ross, Petco, Walgreen's, Panda Express, Starbucks and other great shops.

The kitchen has a wide open feel with stainless steel appliances. The master bedroom is spacious and features two walk-in closets. 

The house is not located on a busy, main road (like some homes in Ewa Beach), so no need to worry about heavy traffic passing by your home. It takes less than a minute to get from the house onto Kapolei Parkway, which provides convenient transit between Ewa Beach and Kapolei. 

And this is a huge plus: directly across the street is a grassy neighborhood park, so the view from this home will not be obstructed by future construction close-by. The house also comes with a gas BBQ range out back. 2-car garage with a covered, gated carport for a 3rd vehicle. 

This is the park located directly across the street from the house.

Sometimes when you think of real estate on Oahu, you may think....Honolulu, big city, traffic, high rise buildings galore, etc. (Or maybe you're thinking grass huts and splitting open coconuts for breakfast. By the way, if this is you, then you REALLY need to visit Oahu!) But there is a special place that is sometimes overlooked by many people when thinking about real estate ....Kaneohe!

  Maybe you're ready to call Kaneohe YOUR home?

-Chelsea Pferschy RS#76072

The median sales price for single family homes started off this year just under 630k in January. It hit a year high this summer at 700k in June. Last month it, dipped again to 650k. 

2014 Median Sales Prices on Oahu SFH

Year Low: January ($629,500)
Year High: June ($700,000)
Last Month: August ($650,000)  

What accounts for the dip? A slight drop in real estate activity after the busy summer months is to be expected. Buyers with families typically aim to get settled into a new home before the school year starts. In the last three years, median prices on single family homes took a dip in autumn before rising again in the winter. This trend can be seen in the chart below:

Median Sales Prices on Single Family Homes (Oahu)

In two out of the last three years, the median price in the winter exceeded the previous summer high. While we can't say with certainty that the median prices this December will be higher than $700k, it's a safe bet to say that it will be higher than last August's $650k. 

In spite of the slight drop last month, median year-to-date sales (January-August) are up 4.1% from last year.   

“August was an interesting month for the Oahu housing market,” said Julie Meier, president of the Honolulu Board of REALTORS®. “This remains a very healthy market, as evidenced by the fact that the average single-family home was on the block for only 15 days before being sold. Also noteworthy is the fact that inventory of both single-family homes and condos is climbing, which will help the market meet demand.”

Although Oahu home prices are still on the rise, the savvy buyer may find an advantage during the autumn dip. 

We are excited to list this beautifully remodeled, ocean-view home in Aina Haina, East Honolulu. Aina Haina is one of the most coveted areas on the island for its proximity to both downtown Honolulu and South Shore beach living. This 4 bedroom, 3 bath corner lot offers 2,414 sf living space and was completely renovated this year. Some newly renovated houses can feel too fancy to be lived in comfortably, but that's not the case with this gorgeous Aina Haina property. The sophistication of this house is impossible to miss, while the choices in aesthetics make it warm enough to feel like home.

The wood tones of the cabinets compliment the flooring help to create an open and inviting kitchen. Other new features include granite countertops and brand new stainless steel appliances.

 Spectacular ocean view from main living space!

New roof, new windows and doors, and new landscaping all around this corner lot. 

Grassy, flat backyard is great for kids and pets. 

See 44 more pics: http://www.alohatony.com/manauwea/

A newer home in Coconut Grove is a rare find. Remodeled in 2007, this 2100+ sf Kailua property is just a short bike ride to the beach (a huge selling point for the buyer). Duplexes can share a lot of wall space with the neighboring unit, but this home is only minimally attached at a storage shed between garages. 

This was a great deal for our clients considering the amount of interior living space in Kailua's Coconut Grove. The property also has a covered two-car garage and a lush, spacious backyard with tropical foliage. We're happy to have helped our clients find and purchase their new Kailua home.

A variety of tropical palms on both sides of the property greet you upon arrival. The common wall is on the storage shed to the right of the garage (no shared walls in living space).  

Beautifully maintained backyard, a perfect setting for a Sunday morning brunch or entertaining dinner guests.  

The unit's interior space is displayed in this shot of the comfy family room.

Newer homes are a rare find in Kailua's Coconut Grove! The paint job and flooring give this bedroom a warm, clean feel. 

While there are several great neighborhoods on Oahu, some are simply more well-known than others. What that means to buyers and sellers is that certain prime locations go virtually unnoticed. 

One of these such neighborhoods is Kaimuki. Situated near two luxury areas, Diamond Head and Kahala, Kaimuki is just a ten-minute drive to Waikiki and fifteen minutes from downtown Honolulu. 

Recent data suggests that sellers have been recognizing value in Kaimuki that many buyers have not. Those who do buy in Kaimuki end up with an overlooked, high-value gem. 

The average listing price in Kaimuki as of April 2014 is the highest it's been in 3 years at $1,087,714. The average sale price, however has DROPPED since the beginning of the year from $921,333 in January to $825,900 in April - a difference of nearly $100,000. Buyers end up paying less even though sellers are initially listing higher. This is encouraging news for buyers. 

But this diamond-in-the-rough neighborhood may not remain a secret for much longer. On average, in 2011, Kaimuki buyers were able to close below list price 10 months out of the year. In 2012, average closings below list occurred in just 8 out of 12 months. Then in 2013, it dropped to 5 (Feb-May and October). As of April this year, it's down to 2. This demonstrates a consistent decline in closings below list price over the last three years. 

More buyers are paying full price or higher for Kaimuki homes with each passing year. In other words, more buyers are realizing the value of property in Kaimuki. Interested yet?

Here are some other reasons to love Kaimuki:

Great places to eat. New, award-winning restaurants include Town, where they garnish their dishes with herbs grown onsite, and Salt Kitchen & Tasting Bar, where you can get a Maui Cattle Co. burger with bacon jam. (yes, bacon made into a jam and spread onto the beef patty). Longer-standing establishments include Big City Diner and Happy Days Chinese Restaurant, famous for their dim sum. Also, visit Coffee Talk for home-made pastries, omelettes, and of course, coffee.

Waialae Ave. has character. Most main streets in Hawaii have their own distinct feel. Depending on where you are on the island the streets can feel suburban in newer, planned developments, or touristy the closer you get to Waikiki. Waialae Avenue is lined with old buildings rented out by new businesses and restaurants. In other words, it has a unique old school/new school vibe. Also, all the lanes have been repaved this month.

Less than a ten minute drive to 1) the University of Hawaii 2) great shopping at Kahala Mall, complete with Macy's, Banana Republic, Apple Store, movie theater and more. 3) Diamond Head for leisurely hiking or legendary South Shore surf. 

As a Kaimuki resident for the last three years, I've developed a fondness for this town. It's old school, yet hip. Busy, yet laid back. Established, yet approachable. Upscale, yet attainable and generally fun to be around. In spite of its paradoxes, what you see is what you get in Kaimuki. It's an honest town, tried and true. At least, that's the way I see it. And in time, that's the way I'd like people to see me.

SOLD: 958 Ocean View Dr. this past January for $50,000 under list price for $1,100,000. Less than 2 months on the market.

SOLD: 732 7th Ave. for $40,000 over original list price in January for $865,000. Just 1 month and 2 days on the market.

AVAILABLE NOW: 4042 Maunaloa Ave. 4 bedroom, 3 bath, listed at $858,000