HONOLULU (HawaiiNewsNow) - Locations – Hawaii's leading real estate firm – published its Oahu Residential Real Estate Report for August 2017. The report, which analyzes sales activity for more than 350 Oahu neighborhoods, concludes that the Oahu real estate market is continuing to show strong and steady growth, with increasing sales figures, rising prices and a competitive buyer's market in August with Days on Market remaining at near-record lows.
In August, both single-family home and condo sales hit their highest point in more than 10 years on Oahu. This is even more remarkable because the pace of sales is currently constrained by limited available inventory. The Oahu median home price hit $786,000 in August, the second-highest median price on record. The all-time high of $795,000 was reached in June 2017, just two months ago. Prices will likely continue to rise in 2017. Home prices are up all across Oahu, in almost every market area. Competitive demand is increasing in the more affordable areas in and around urban Honolulu.
"Oahu's real estate market showed continued stable growth in August, with moderate increases in median price and new listings for both single-family homes and condominiums," says Scott Higashi, President and CEO of Locations.
"With a 16 percent increase in sales year over year, condos remain popular with homebuyers for their affordability and convenience. Months of remaining inventory is down 15 percent for single-family homes to 2.8 months and 4 percent for condos to 3 months, indicating an advantage for sellers. Homes that are priced well are selling at or above asking price in only a few weeks."
Sales are increasing in 2017. In August, both single-family home sales and condo sales hit their highest point in more than 10 years. This is even more remarkable because the pace of sales is currently constrained by limited available inventory. The Oahu median home price hit $786,000 in August, second-highest median price on record and 5 percent higher than last year. The median condo sale price of $415,000 is up 3 percent over last year. Prices will continue to rise in 2017 for both single-family homes and condos due to the current competitive market environment.
Time to sell, measured by Days on Market, is dropping significantly in 2017, with both single-family homes and condos still at near-record lows in August. Low Days on Market is an indicator of both competitive real estate market conditions and strong demand. Inventory for sale has seen welcome increases in 2017. The number of active condo listings has risen above the previous year's count for the first time in almost 3 years. Low inventory constrains sales and increases competition for available properties.
Months of Remaining Inventory (MRI), also called absorption, is at record lows in 2017, the tightest supply conditions in more than 10 years. If no new properties came on the market the existing supply would sell out in less than 3 months. MRI is an indicator of the supply-demand balance. Bid-ups are the percent of sales that are bid-up over asking price in competitive bidding. Bid-ups are an indicator of demand and signal rising prices.
Single-family home prices are rising in almost every market. The above chart shows 2017 single-family home median prices for 12 months through August compared to 2016 median prices, by market area. Areas close to the urban core showing demand by price increase are Manoa, Kaimuki and Hawaii Kai.
Bid-ups are the percent of home sales that are bid-up over asking price through competitive multiple offers. Bid-ups push prices upward. In 2017, many Oahu single-family home markets have seen strong increases in bid-ups. There are strong increases in competitive demand in Manoa, Kaimuki, East Oahu and Hawaii Kai, mature neighborhoods in Honolulu.