A short but interesting article that suggests Oahu real estate may be stabilizing was released by CNBC yesterday. Looking at the statistics for Oahu, we see that homes sales are up 9.5% from January to June 2009 compared with the same time last year. This comes out to 254 houses sold in 2009 vs. 232 houses sold in 2008.
It’s an interesting argument, and could very well be the case. However, the increase in number of homes sold could very well be spurred from lower prices, lower interest rates and the Obama tax credit. Interest rates will rise, the tax credit will end, and where will that leave us? Most likely in a scenario where home prices plunge even further, but the only people who will be able to buy them are those who can make an all cash offer. Even if you can get financing, interests rates will be so high (to offset inflation) that your monthly mortgage payment will be more then if you bought now – even if the home is more expensive.
There are also a lot of statistics that we don’t see. Relying on median prices tells us nothing, really. That’s why HawaiiLife.com is working on a stats and trends page that will include average price for sale, average price per square foot, average assessed value, etc. We hope to have this available to you sometime in August.
Alright, enough typing, here’s the CNBC Oahu stabilizing article.