All real estate is local, so if you are looking to buy or sell a property, you’ll want to get local data from a local expert. You’ll want to go as narrow and as deep as you can when it comes to your own property evaluation. And, your personal real estate decisions.
Will Prices Decline?
It’s also advisable for you to learn about real estate on a national level. Hawaii may be in the middle of the pacific, but national trends impact you and your housing decisions. So, you might find this interesting: Lawrence Yun, chief economist for the National Association of Realtors® does not foresee a nationwide decline in home prices.
Recently, Yun testified at the U.S. Senate Committee on Banking, Housing, and Urban Affairs. He stated that the potential for weaker sales should increase available inventory in some markets, but not enough to diminish persistent affordability constraints. Are you wondering why? Essentially, we have a historic undersupply of inventory in the market. But, we still have demand. Yes, we may see some short-term price adjustments given the jump in interest rates. But, are prices going to decline substantially?
Did you know that we have a 6 million unit shortage of housing in America? Sadly, the need for housing in our country is dire. Underinvestment and a lack of construction have led to an acute shortage of available and affordable homes. In fact, growth in America’s housing inventory has slowed significantly since the turn of the century. More so this last decade. A recent NAR report calls it an “underbuilding gap” of 5.5 to 6.8 million housing units since 2001. Wow!
Our nation’s — and Hawaii’s — lack of inventory and affordable housing are real. Complicated. Complex. So are the solutions.
I don’t want to over simplify complex issues that are way above my pay grade. But, if you consider the fact that Hawaii has limited land, very few building starts, and strong demand, it stands to reason that prices won’t decline. At least not by much.
For Buyers and Sellers
So, what does this all mean for you? If you are thinking of buying, don’t wait simply because you think prices are going to tank. And, if you are thinking of selling, it’s still a great time. People want homes. Especially Hawaii homes.