Oahu home sales, median prices go in opposite directions

A new report from the Honolulu Board of Realtors painted a mixed picture of Oahu’s real estate market in September with sales of single-family homes and condominiums strengthening for the second month in a row, but prices continuing their downward slide.

The Honolulu Board of Realtors said Friday that 284 single-family homes were sold on Oahu last month, up 4 percent from 273 in September 2010. The increase followed a 23 percent jump in August. Before that, sales volumes had declined for four consecutive months on a year-over-year basis.

The median sales price dropped to $570,000 in September, an 8 percent decline from $620,000 the same month a year ago. It was the fifth straight drop in the median price on a year-over-year basis.

Condo sales rose 19 percent to 364 last month from 306 in September 2010. The median price slipped 4 percent to $316,500 from $330,000.

Part of the reason for the softness in prices for both single-family homes and condominiums is a persistent foreclosure problem that has been hanging over the market for the past several years, according to the Board of Realtors.

Still, the increase in sales volume and other indicators — including a decline in the number of days it took to sell a single-family home and an increase in pending sales — bode well for the market.

"We’re encouraged by September’s numbers, with sales of both single-family homes and condominiums increasing over last year," said Joyce Nakamura, president of the Honolulu Board of Realtors.

"The fact is that consumers are purchasing properties that are appropriately priced for today’s market. And while it appears that foreclosures and short sales are continuing to drive prices down, the good news is that there are a lot of great buys out there, especially given the low interest rates," she said.

Mortgage rates have been on a downward trajectory for more than a year, and this week reached a record low. On Thursday, Freddie Mac said the rate on the 30-year fixed mortgage fell to 3.94 percent, the lowest in history. The average rate on a 15-year fixed loan, a popular refinancing option, dipped to 3.26 percent, also a record.

The most active area for single-family home sales last month was the Ewa Plain, where 48 homes changed hands, a 7 percent increase from September 2010. The median sales price of $452,500 was 1 percent lower than a year earlier, when homes sold for $456,500.

The sharpest increase in sales was in the Kapahulu-Diamond Head area, where the 28 homes sold represented an 87 percent increase from 15 sales a year earlier. The median price fell 4.4 percent to $889,000 from $930,000.

The strengthening demand has contributed to a decline in the inventory of unsold properties islandwide.

There were 1,486 single-family homes listed for sale last month, 84 fewer than a year earlier. At the current pace of sales it would take 5.9 months to liquidate the inventory of unsold homes.

The number of condos available for sale fell to 1,866 in September, down from 2,139 the previous year. It would take 5.5 months to sell off the available inventory of condominiums at the current sales pace.