As I'm looking at the statistics that just came out from the Honolulu Board of Realtors, I'm laughing! Mainly because at the beginning of the year I actually thought that maybe the market may start to slow down in 2016 (see my article from March 2016 below in the blogs)... Boy, was I wrong!

      Not only did our market continue to soar in 2016, but December was the 2nd highest month for # of sales. December is usually a bit slower as expected with the Holiday's.

     The median home price for Oahu went up from $700K to $735K. And the median condo price went up from $360K to $390K respectively. The Honolulu Board of Realtors calls this "stable". The average days on market for both SFH and condo's went down (that's a good thing) to 18 days on market for both. WOW, that's fast! The key is choosing the right agent who KNOWS the market and has a lot of experience selling homes in your neighborhood, in order to get the best and highest price. There are a few homes on the market that are sitting idle because their agents' have not helped them get their homes in sell-able condition. This doesn't help the agent either, so the whole thing boggles my mind...

     The number of homes for sale (inventory) has remained flat, which continues to drive our market. This lack of inventory has helped many get into homes, while simultaneously lowing our standards by consumers buying out of desperation of loosing yet another home.

     January and February tend to be slower months (but not by much), but come March things will get crazy again with military folks coming in and people starting to buy new homes that will close at the end of the school year. What does this mean for you? Use this time in Jan and Feb to find your home while the masses stay at bay until March! ;) Buy a home now, and hold onto it!

     The public is encouraged to visit www.hicentral.com to see what's happening in the housing market. And, as always please feel free to call one of us at alohatony.com for real estate advice and services. We remain in the Top 100 Realtors of Hawaii and enjoy serving our clients with Aloha.

by:Chelsea Pferschy RS, MRP (808) 754-6000 chelseapferschy@gmail.com

From the Advertiser: The state Public Utilities Commission approved a power purchase agreement on Wednesday between Hawaiian Electric Co. and the developer of a Kahuku wind farm project, described as the largest of its kind on O'ahu.

The facility, which could begin operating in early 2011, would generate enough electricity to power 7,700 homes.

The agreement between HECO and Kahuku Wind Power, a subsidiary of Massachusetts-based First Wind, calls for HECO to purchase 30 megawatts that will be produced by 12 wind turbines in Kahuku. HECO will pay 19.9 cents per kilowatt hour as part of a 20-year agreement with First Wind, said Darren Pai, HECO spokesman.

A typical residential bill on O'ahu this month is $158.20 based on 600 kilowatt hours of usage, Pai said. He said the Kahuku project itself won't necessarily reduce a customer's bill, but it is part of an ongoing effort to reduce the state's dependency on fossil fuels.

"It's going to be one piece of the puzzle because we're going to need a lot of different types of renewable energy resources to meet our clean energy goals," Pai said.

HECO said the project should reduce oil consumption by about 153,000 barrels a year and also reduce carbon dioxide emissions.

Many people don't realize that you cannot deduct losses from a rental property unless you can meet one of the criteria in these seven tests below. Many real estate investors meet the
"materially" participating rule by one or more of the first three tests, but any of the 7 will do:

1. Managing and operating the rental real estate activity for more than 500 hours during the year; or

2.
Doing substantially all the work required to manage and operate the
rental real estate during the year (probably more than 70% of the total
business hours are performed by the landlord); or

3.
Working more than 100 hours during the year with no one (including
nonowner employees and independent property managers) participating
more than the landlord [Reg. §1.469-5T (a)(1)-(3)].

However,
an owner can "tack" a spouse's time for calculating the tests mentioned
above (e.g., an owner/investor performing 51 hours could add a spouse's
time of 50 hours to exceed the 100-hour requirement) [Reg.
§1.469-5T(f)(3)]; or

4. Working 500 hours in all the
multiple small businesses owned. This is for the taxpayer who has his
or her fingers in many pies; or

5. Materially
participating for five of the last ten years. The years do not have to
be consecutive, and only the 500-hour rule (test 1 above) may be used
[Reg. §1.469-5(j)]; or

6. Materially participating
in any three previous years in a "personal service activity." These
could be in the field of health, law, engineering, architecture, etc.
[§1.448T(e)(4)] or any other trade or business in which capital is not
a material income-producing factor [Reg. §1.469-5T(a)(6); also
§1.469-5T(d)]; or

7. "Facts-and-Circumstances" test.
A taxpayer who does not satisfy any of the previous six tests may try
to convince the IRS that he or she is materially participating (or not
materially participating if he or she wants the income determined
passive) based on all the facts and circumstances. One would have to
prove participation on a "regular, continuous, and substantial basis

From The Advertiser: "Revenue per available room, or "revpar," rose to $122.43 in March
from $119.21 a year earlier, according to a report released today by
Hospitality Advisors and Smith Travel Research."

"After 24
consecutive months of room revenue losses, the rise in monthly occupancy
during March was finally able to outpace room discounting for a modest
revenue gain," said Joseph Toy, president and chief executive officer of
Hospitality Advisors LLC, a local travel industry consulting firm.

Statewide, hotel room occupancy rose to 70.6 percent in March from 65.2 percent a
year earlier. Occupancy has increased in six out of the past seven
months due in part to discounting.

Nationally,
Hawai'i's 70.6 percent March occupancy rate was the third highest in
the country, trailing New York at 72 percent and Miami at 77.9 percent.  Hawai'i's
$173.41 average daily room rate also was third highest, behind Miami
at $182.70 and New York at $188.06.

I was suprised to see this article in Pacific Business News today, which said that Maui real estate sales jumped in April, up four times over the number of sales a year ago.