July 3, 2010

Oahu real estate market update July

The average price of an Oahu home for sale rallied strongly in the month of May, pointing towards the continued recovery of the Oahu real estate market. According to a June 3, 2010 article from Pacific Business News, “Oahu home prices are up 5.1 percent on average over the past year, according to a report released Thursday by a provider of real estate valuation and risk assessment for financial services companies. Comparing the three months ended May 31 with the same period last year, California-based Clear Capital ranked Oahu as the seventh-highest performing major market nationally, with a 2.2 percent price increase, behind Dallas, Pittsburgh, San Diego, San Francisco, Houston and Minneapolis.
The number of bank-owned properties on Oahu — 7.5 percent of the total — remains modest. The United States’ biggest offender in this area, Las Vegas, shows banks owning 45.9 percent of all properties on the market.”

The Oahu foreclosure market, especially in the commercial sector, continued to face difficulty despite the perceived recovery of the rest of the real estate market. According to a June 18, 2010 article also from Pacific Business News, “The Four Seasons Resort Maui in Wailea, which serves as collateral for one of the largest delinquent loans in Hawaii, got a bit of more bad news this week when a portion of the loan was assigned an appraisal reduction of 25 percent. The Maui resort tops a list of more than a dozen hotel, industrial, office and retail properties that have defaulted on multimillion-dollar commercial mortgages or have been lost to foreclosure. The $425 million loan on the Four Seasons Maui property, which is owned by billionaire Michael Dell’s investment firm, was transferred to special servicing in April after falling delinquent on payments, according to Trepp.com, which researches commercial mortgage-backed securities and commercial mortgages.”

The economy of the island of Oahu seems to be gradually recovering as well, which should help boost the already rising numbers in the Oahu housing market. A June 21, 2010 report from the Associated Press found that “Personal income in Hawaii has grown at the sixth-fastest rate in the country through the first quarter of this year. The U.S. Bureau of Economic Analysis reports Hawaii residents’ cumulative personal income increased by 1.35 percent in the first quarter compared to the previous quarter. Military earnings jumped the most, at 0.37 percent. Retail trade, construction and federal civilian earnings all went up 0.13 percent. The industry with the largest earnings decrease was real estate, at a minus 0.05 percent.”

July 3, 2010

Big Island Hawaii Housing Market Update

In a trend mirroring other neighbor islands, the Big Island Hawaii real estate market is seeing increased rates of sales at lower median prices. This theme extends to both single family homes and condominiums on the biggest Hawaiian Island. According to a June 7, 2010 article from the Pacific Business News, “Sales of condominiums on the Big Island rose by nearly 75 percent last month, and sales of single-family homes were up by 25 percent when compared to May of last year. There were 53 condos sold on the Big Island in May, 71 percent more than the 31 units sold during the same month in 2009, according to statistics from the Hawaii Information Service. A total of 128 single-family homes were sold in May compared to 102 homes sold during the same month last year. Prices, however, were down for both categories. The median price for a single-family home on the Big Island in May was $279,500, down 7 percent from $300,500 in 2009. The median price for a condo in May was $285,000, down 8 percent from $309,000 in 2009. Year-to-date figures follow the same trendlines, with sales of single-family homes — 612 in all — up 43 percent and the median price down 8 percent to $256,500. Sales of condos for the first five months of the year, with 213 units sold, were double that of the same period in 2009, while the median price, at $270,000, was also down 8 percent.”

However, delinquent loans, including foreclosed properties and short sales, continued to be a drag on Big Island homes for sale and other sectors of the local housing market. According to a June 18, 2010 report by Janis L. Magin of Pacific Business News, “Sometimes it can take several months for a property to drop off the list after the owner has settled with the lender, but Bratton said he has seen more Hawaii properties turn up on the lists of delinquent loans. Several Neighbor Island shopping centers, including the Kings’ Shops at Waikoloa on the Big Island, Coconut Marketplace on Kauai, Coconut Grove in Kailua-Kona and the Kona International Market, also turned up on Trepp’s list of distressed loans.”