Interest rates may be rising, but bids over asking are still status quo. If you are looking to buy, be aware that the real estate market in Hawaii remains brisk even in spite of rising interest rates. Prices continue to rise with a new median for single family homes on Oahu reaching $1,150,000. Wow! Condos also set a new record at $515,000!
It’s frustrating for Buyers who continue to clamor for property. It can be frustrating for some would-be Sellers, too. After all, many people would like to sell to trade up or down, but first, they need assurances that there are available properties to buy. And, therein lies the problem.
Low Inventory on Oahu
In all my years of real estate, I have never seen inventory so tight. On Oahu, whether you are buying in the $200,000 price range or up to the $2,000,000 price range, the months supply of single-family active inventory is around one month. Even for prices between $2 to $3 million, the active supply is a paltry two months. In general, a balanced market will lie somewhere between four and six months of housing supply. When supply is over six months, buyers gain negotiation power, but we aren’t even close to that happening.
Many Buyers Consider Condos
It’s no surprise that rising prices are pushing more prospective buyers to consider condos, but even in the condo market, we have less than two months of supply for properties under $1,000,000. It’s not until you start looking for condos in the $1.5 mil range do you see more than six months of supply. So, if you want some negotiating power, high-end luxury condos may be your best bet.
More Inventory Upcoming?
The charts below tell the story and it is pretty grim. But, there is some good news. We are entering the most active selling season on Oahu. Historically, spring and summer see increased inventory and with increased inventory there will be more opportunity to buy and trade. People sell for lots of reasons — job transfers, military moves, retirement, and for financial and personal reasons. Some Sellers may just decide to put their homes on the market to cash in on all their new found equity. Even if it means leaving Hawaii. For whatever reason, there will be people who choose to list and sell their properties.
Just be ready when they do.