March 20, 2023

What Buyer Activity Tells Us About the Housing Market

What Buyer Activity Tells Us About the Housing Market




Though the housing market is no longer experiencing the frenzy of a year ago, buyers are showing their interest in purchasing a home. According to U.S. News:

“Housing markets have cooled slightly, but demand hasn’t disappeared, and in many places remains stronglargely due to the shortage of homes on the market.”

That activity can be seen in the latest ShowingTime Showing Index, which is a measure of buyers actively touring available homes (see graph below):

The 62% jump in showings from December to January is one of the largest on record. There were also more showings in January than in any other month since last May. As you can see in the graph, it’s normal for showings to increase early in the year, but the jump this January was larger than usual, and a lot of that has to do with mortgage rates. Michael Lane, VP of Sales and Industry at ShowingTime+, explains:

“It’s typical to see a seasonal increase in home showings in January as buyers get ready for the spring market, but a larger increase than any January before after last year’s rapid cooldown is significant. Mortgage rate activity this spring will play a big role in sales activity, but January’s home showings are a positive sign that buyers are getting back out there . . .”

It's important to note that mortgage rates hovered in the low 6% range in January, which played a role in the high number of showings. What does this mean? When mortgage rates eased, buyer interest climbed. The jump in home showings early this year makes one thing clear – while rates may be volatile right now, there are interested buyers out there, and when mortgage rates are favorable, they’re ready to make their move. 

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March 12, 2023

March '23 Housing Market Update

O‘ahu Home Sales Pick Up Month-to-Month, Remain Down Year-Over-Year


Single-family homes are taking nearly four times longer to sell, and condos are taking two times longer to sell compared to 2022.
 

O‘ahu’s housing market remained sluggish in February, with closed sales of single-family homes and condos down 28.2% and 33.1%, respectively. However, single-family home sales rose 15.3%, and condo sales increased by 18.2% compared to January 2023.

Median sales prices in both markets declined, dipping 12.3% for single-family homes from $1,125,000 to $987,000 compared to 2022. The condo market experienced a modest 3.4% decline from $497,000 to $480,000. Roughly 189 O‘ahu properties sold for under $500,000 in February.

In February 2023, single-family homes nearly quadrupled the median days on market, skyrocketing to 47 days compared to 13 days in February 2022. The median days on market for condos doubled to 28 days compared to 14 days a year ago.

“O‘ahu’s housing market is in a very different place from a year ago, with activity calming across all facets. Notably, properties are spending significantly longer on the market before closing," says Fran Villarmia-Kahawai, president of the Honolulu Board of REALTORS®. “Average mortgage rates began to dip heading into February but started to tick higher throughout the month, weakening buyer purchasing power compared to one year ago.”

 

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Feb. 16, 2023

Feb '23 | Market Update

New Year Sees Home Sales Fall by Half, Median Sales Prices Dip Modestly
Single-family home median sales price falls below $1 million
 

The new year began with closed sales of O‘ahu properties falling significantly year-over-year, with single-family homes dropping 54.0% and condos declining 50.2%. After 17 consecutive months of single-family home prices reaching $1,000,000 or more, January ended with a single-family home median sales price of $970,000, representing a 7.6% decline compared to January 2022. The condo market also saw the median sales price dip 2.9% to $495,000.

“The median sales price for a single-family home on O‘ahu fell below the $1,000,000 mark because costlier financing is placing some downward pressure on prices,” says Fran Villarmia-Kahawai, president of the Honolulu Board of REALTORS®. “Sellers are having to adjust their approach as buyer demand wanes due to elevated interest rates.”
 
Properties are spending a median of 24 days on the market, roughly double the time compared to last year when the median for single-family homes was 12 days, and the condo median was 14 days. New listings are also slowing, dropping 16.3% for single-family homes and 21.5% for condos. Despite this, active inventory continues to grow compared to 2022, up 77.2% in the single-family home market and 23.7% in the condo market.

 

 

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Jan. 19, 2023

Advice for Buyers & Sellers in Today’s Housing Market

I read a few articles a week to keep up with housing market trends, and this one made incredible sense as I've seen in my own practice, and in O'ahu's market. There is so much "poor housing news" meant to drive traffic etc.. this I felt was worth sharing. Although originally published in Aug of 2022, and from Sacramento, CA,- the comments still hold mostly true here on O'ahu, although now I feel our market is warming up again from a STALE winter. Also, the meme's got a great laugh from me!

I hope you enjoy reading as much as I did, pasted with link to full article.

Thank you for the post: SacramentoAppraisalBlog.com.

Advice for buyers & sellers in today’s housing market

 By 

The housing market has shifted, and today I have some practical advice for buyers and sellers. This is coming from hundreds of conversations every month as well as stats I’m pulling...

ADVICE FOR BUYERS:

Don’t lowball like it’s 2008: It’s not a name-your-price market, so you still have to make reasonable offers instead of way below market value. I find some buyers think it’s 2008, and that’s not the vibe right now. For instance, a property was priced well at $450,000 and a buyer offered $320,000 (final closed price was $455,000). If you get lucky at a low level, great. I’m just saying, being reasonable rather than lowballing is likely a better strategy.

CLICK HERE FOR LINK TO FULL ARTICLE

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Jan. 10, 2023

Jan '23 | Market Update

O‘ahu Home Sales Cool in 2022 Amid Rising Mortgage Rates
Single-family home and condo sales volume saw double-digit declines 
despite a strong start to the year

In December, sales for single-family homes plummeted 46.6%, while condo sales were down 39.3% year-over-year. The median sales price for a single-family home dipped slightly to $1,049,500, while the median condo sales price rose to $502,500. 
 
In the single-family home market, the $800,000 to $999,999 range saw a whopping 225% increase, with 143 listings available at the end of the year compared to just 44 listings in December 2021. In the condo market, active inventory most significantly increased primarily in the mid to upper price ranges. Year-over-year, active inventory in the $400,000 to $1,999,999 price range rose by 50%.

2022 Year-End Stats 
In 2022, O‘ahu’s real estate market was marked by transition. The year began similarly to 2021 with intense competition among buyers, with mortgage rates still hovering near historic lows and ended with headwinds when these rates rapidly and sharply rose. Key highlights included:

  • In the second quarter of 2022, 63% of single-family homes and 44% of condos closed above the original asking price.
  • In May, the single-family home market set a record median price of $1,153,500; in June, the condo market hit a record median of $534,000.
  • Mortgage rates continued to rise through the year, with average rates reaching the 7% range in late October and ending 2022 in the mid-6% range.
  • In the fourth quarter, the percentage of properties sold above the original asking price had dropped to 29% of single-family home sales and 25% of condo sales. 

The year ended with 3,474 single-family home sales, a 23.2% year-over-year decline. The year-end median price climbed to $1,105,000, an 11.6% increase compared to the 2021 annual median price of $990,000.
 
In 2022, condo sales also fell, ending the year with 6,353 closed sales and down by 11.8%. Year-end sales were still well above pre-pandemic sales volume dating back to 2007. The condo market ended the year with an annual median sales price of $510,000, up 7.4% from a year ago.
 
“While O‘ahu’s real estate market started the year strong, the steep rise in interest rates and fluctuation in inventory are shifting the market dynamic,” says Fran Villarmia-Kahawai, president of the Honolulu Board of REALTORS®. “Although buyers face higher financing costs, they now have more options to choose from, and competition isn’t as fierce.”

 


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Dec. 12, 2022

December | Market Update

Price Reductions Increase Amid Sluggish O‘ahu Home Sales 
Median sales price for condos drops 4% year-over-year to $480,000 

O‘ahu’s single-family home and condo markets experienced a significant year-over-year decline in sales, falling 48.2% and 43.4%, respectively. The median sales price for a single-family home rose 9.5% to $1,149,500, while the median sales price for a condo dipped 4.0% to $480,000 compared to November 2021.

The number of single-family homes and condos sold over the original asking price dropped significantly, falling 73% and 68%, respectively. More active listings underwent price adjustments in November 2022, with approximately 46% of single-family home active listings and 36% of active condo listings experiencing a price reduction at some point during their time on the market.
 
Active inventory continued to build across Oʻahu, with single-family home supply more than doubling in the Central Oʻahu, the Ewa Plain, Leeward, Pearl City, and Waipahu regions compared to a year ago. The condo supply increased in all regions except Diamond Head and Pearl City.
 
“We’re seeing more sellers adjusting the price of their listings to remain competitive on the market in the face of the gradual increase in new inventory and properties spending more days on the market,” says Chad Takesue, president of the Honolulu Board of REALTORS®. “Though buyers are dealing with higher financing costs than a year ago, contracts are closing daily, albeit at a slower pace and volume than in 2021.”
 
Closed sales in both markets declined across most price points, with single-family homes in the $700,000 to $1,099,999 price range accounting for the most significant decrease, down 55% year-over-year. Condos within the $400,000 to $699,999 price range dropped by 50% compared to a year ago, although properties in the $2 million and above price range doubled. Both markets in the Ewa Plain (down 64% for single-family homes and 65% for condos) and Metro regions (down 54% for single-family homes and 43% for condos) accounted for the most significant decline in closed sales. Meanwhile, around 180 propertysales closed under $500,000 in November 2022.
 
“It’s likely that first-time homebuyers purchased many of these properties under $500,000. We encourage potential buyers to remember that homeownership is possible in Hawai‘i when you prepare, plan accordingly and work with a professional REALTOR®,” Takesueadds.
 
Considerable pockets of single-family home inventory were available at all price points, with properties in the $600,000 to $999,999 range reaching a 175% boost year-over-year. Condo supply fluctuated across price margins, although properties in the $400,000 to $1,999,999 range saw a 45% increase, and properties priced at $399,999 and below were down by 11%. Active condo listings priced above $2 million decreased by 17%.

 

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Oct. 27, 2022

8 Reasons we won’t have housing inventory armageddon any time soon

8 Reasons we won’t have housing inventory armageddon any time soon

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Oct. 13, 2022

Real Producers Mag Sept '22 Cover Article

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Oct. 13, 2022

October | Market Update

Sales of O‘ahu Homes Cool Amid Rising Mortgage Rates


Median sales prices remain relatively flat, active inventory builds gradually

Rising mortgage rates are weighing on home sales. Year-over-year, single-family home and condo sales dropped 34.4% and 19.3%, respectively, and compared to August 2022, single-family home sales were down 11.5%, while condo sales dipped 2.4%. Pending sales activity was also muted compared to last year, with contract signings falling 43.7% for single-family homes and 30.7% for condos.

Median sales prices remained relatively flat over the last several months and saw a slight bump up compared to the same time last year. In September, the single-family home median was $1,100,000, up 4.8%, while the condo median sales price was $502,500, a 5.1% increase from a year ago.
 
“With rising rates and inflation, buyers are reevaluating what they can afford, and this is having ripple effects across supply and demand in our local housing market,” said Chad Takesue, president of the Honolulu Board of REALTORS®. “Fortunately, our 10-year appreciation rates on O‘ahu have been historically favorable, so despite interest rates being about 6%, real estate is still a smart investment. It’s important to remember that the market varies from neighborhood to neighborhood, and housing opportunities are available for everyone.”

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Aug. 16, 2022

August | Market Update

Sales of O‘ahu Homes, Condos Fall Nearly a Quarter in July


Properties continue to move into contract quickly despite cooling demand

Closed sales in both single-family home and condominium markets declined by 22.8% year-over-year. Sales also slipped from a month ago, down 12.6% for single-family homes and 17.3% for condos.

“Demand continued to cool in July, likely due in part to the rise in interest rates,” said Chad Takesue, president of the Honolulu Board of REALTORS®. “However, properties are still moving into contract quickly with median days on the market at 11 days for single-family homes and 12 days for condos last month, despite the decline in sales.”

Pending sales were down year-over-year 31.4% for single-family homes and 26.4% for condos. Fewer new listings were added to the market compared to a year ago, with 386 single-family home listings, a 17.7% year-over-year decline, and 616 condo listings, down 7.2% from last July. However, the active inventory of single-family homes was 38.8% more than last year, and the active inventory of condos was up 8.4%.

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