April Oahu condo prices set record

The median sales price for condominiums on Oahu hit an all-time high in April as more buyers appeared to opt for condos while the supply of single-family homes remained low, the president of the Honolulu Board of Realtors said Saturday.

Sue Ann Lee, president of the board, said the American dream is to own a house, but more people are accepting the reality that owning one may not be possible for now in Honolulu and are taking other options.

“It’s mostly affordability and lack of inventory,” she said by phone.

Housing data released by the Honolulu Board of Realtors show a bump in previously owned condo sales, with a 5.7 percent gain in April to 486 compared with 460 in the year-earlier period. Last month’s median sales price of $415,500 for condos was the second month in a row that the median price reached at least $400,000. It was a 6.7 percent increase from the $389,500 in April 2016.

Meanwhile, slower sales activity among single-family homes brought down sales 7 percent in the year-over-year period to 280 from 301.

The weaker sales were coupled with a 1 percent drop in the median sales price to $712,500 from $720,000.

The dip in home sales, however, didn’t translate into less vigorous bargaining on the market.

Ruwena Baetiong, a real estate agent with Century 21 Homefinders of Hawaii, said demand for single-family homes in West Oahu, where she focuses, has been relentless. Buyers are still interested in single-family homes because they want to avoid condo maintenance fees, and potential buyers are offering $20,000 above the appraisal value.

“They (buyers) don’t even care as long as they get the chance to get the house,” she said. She noted she rarely sees a three-bedroom home built in the 1960s in West Oahu sell for under $600,000 — the median sales price for a home four years ago. The median price is a point at which half the sales were at a lower price and half at a higher price.

Lee said from January through April, the median sales price for a home has been about $740,000, but to find a house at that price a buyer would have to look away from Honolulu, in a city such as Pearl City or Aiea.

In Honolulu, anything priced at $800,000 to $900,000 will sell, she said.

Lee, however, said potential homebuyers should not be discouraged by the median prices.

“About 39 percent of single-family houses sold in April were in the $500,000 to $699,999 range and 44 percent of condominiums were between the $300,000-$499,999 range,” she said. “While we’re encouraged by the new listings coming onto the market, it is still not enough to keep up with the demand for housing at all price points.”

While the demand for mid-market condos remains strong, the high-end market is tapering off, said Trevor Benn, a real estate agent and owner of Benn Pacific Group.

The slowdown is being driven by a stronger dollar, rising interest rates and a larger high-end inventory.

Last month, sales closed for the 200 units at Park Lane Ala Moana and other condos in Kakaako still have openings. Benn noted that about 50 percent of the buyers at Park Lane are local residents, many from East Oahu looking to downsize as they age.

“Sales velocity has slowed down,” he said. But for mid-market products, such as Kapiolani Residence on Kapiolani Boulevard, which sold out this year, demand is still high.

Lee said there haven’t been a lot of luxury condos flipped in Kakaako because there are still unsold units in the new buildings.

She added that demand for single-family homes and condos is outpacing new listings. Last month, there were 447 new listings for single-family homes and 552 pending sales. For condos, there were 672 new listings and 773 pending sales.