Market FAQs During Covid-19
- Market FAQs
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Q: How has the pandemic impacted home listings and sales in Hawaii?
There was definitely a slowdow in the spring of 2020, but the Hawaii real estate market is now busier than ever before. Due to travel restrictions, there are naturally fewer buyers in the market because most foreign travelers are not permitted to Hawaii yet. Obviously, fewer travelers = fewer homebuyers. However, U.S. residents have been able to return under the State of Hawaii’s Pre-Travel Testing program, implemented in mid-October, 2020.
For safety reasons, our agents are not conducting open houses, though we have been able to resume socially distanced home showings using all necessary precautions. Masks are mandated, with slightly different rules by County/Island.
Q: What is the Hawaii real estate market like since travel restrictions and social distancing were put in place?
We have seen activity with local buyers who were actively looking before the pandemic hit. Some prices are dropping, and some sellers are willing to negotiate on price. These trends started to appear in April.
We have seen homes taken temporarily off the market—these are mainly owner-occupied homes. There is still a market for lower-priced properties. Vacant land is selling, especially on the Big Island, where more is available.
Buyers have more time to search online and request virtual tours of properties in anticipation of getting to the island. Many travelers had their trips canceled unexpectedly in March and April. We are now seeing slight increases in travel and mobility as states begin to reopen.
Q: Can foreign buyers purchase property in Hawaii right now?
Yes, although Hawaii’s State Senate has put forth a bill that could radically restrict foreign purchases. The legislature is not in session, so that bill has not yet been voted on by the full house or ratified into law. If a foreign buyer is intent on purchasing in Hawaii, there really couldn’t be a more critical and urgent time than now.
Q: What are some Hawaii real estate investment strategies right now?
While this is a broad question, our view is that you have to want the real estate more than the money. Real estate may seem to some to be inherently more valuable, especially after the considerations surrounding the recent Shelter-in-Place orders and very real considerations of “value.” All assets run the risk of rapidly being devalued, but real estate carries with it very internal and tangible values that cash, stocks and equities simply can’t provide.
Investment strategies depend on your current goals, portfolio and situation. Of course, we recommend consulting your CPA and/or financial advisors when considering anything as a true “investment.” But let’s face it – there are almost always personal reasons involved in the purchase of real estate in Hawaii. What’s it worth to you?
Q: Is this a good time to buy a (second or vacation) home in Hawaii?
Yes, but you need to act quickly and decisively. The market is booming and the best inventory gets purchased quickly. There will be continued pressure on vacation rentals in the next 12-18 months, both related to Covid-19 and the ongoing housing shortages in Hawaii, so it’s unwise to plan on vacation rental income as a means of affording a second home. For true second home end users, however, there continue to be excellent buying opportunities.
Q: How does Hawaii Life expect the real estate market to change and evolve for the balance of 2020?
After a significant lull in spring activity, the summer and fall months have been especially busy. Listings returned to the market, and trading volume picked up considerably beginning in early July. Inventory is low, however, as mainland buyers and local residents are taking advantage of low interest rates and less buyer competition from foreign markets.
Q: Where can I find market updates and market information?
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