June was almost a record for Oahu housing market

It could be just a blip — or a sign of more to come — but Oahu’s housing market got within a hair of breaking a price record in June.

A Honolulu Board of Realtors report released Monday showed that buyers paid a median $677,250 for single-family houses on the island last month, just 1 percent shy of the peak for any month set in June 2007 at $685,000.

The surge, which represented a 9 percent gain over a $620,000 median in June 2012, was driven in part by increased demand for higher-end houses and a more depleted inventory at the market’s lower end, the report’s data suggest.

There have been prior single-month spikes in the median price that weren’t sustained. Such was the case in May 2012, when the median surged to $664,000.

The broader trend this year has been a slight median price rise amid choppy monthly moves that included three declines of between 4 percent and 5 percent.

Oahu’s median single-family house sale price for the first six months of the year is up just 0.8 percent to $625,000 compared with $619,750 in the same period last year. The annual median price peaked at $643,500 in 2007.

The University of Hawaii Economic Research Organization forecast in May that Oahu’s median house sale price will rise 4.1 percent this year to $651,100 to eclipse the prior annual peak.

Oahu’s housing market appears poised to strengthen for a second consecutive year after an 8 percent median price gain last year. But this year has been more constrained by relatively low inventory despite relatively strong demand driven by a recovering economy and low interest rates.

"Inventory is holding back the market a little bit," said Scott Higa­shi, executive vice president for sales at Prudential Locations. "That condition continues to be what I think is the most outstanding factor in the market."

Higashi said the imbalance in supply and demand has led to more competitive bidding and that much of the supply constraint has been at the lower end of the market.

Honolulu Board of Realtors data show that inventory in June was down 20 percent for houses priced under $650,000 but up 1 percent for houses priced above $800,000.

The total number of houses on the market in June stood at 1,153, down from 1,290 a year earlier and 1,533 two years ago.

Despite the relative low inventory, the number of sales in June was up 10 percent to 308 from 279 in the same month last year. For the first six months of the year, sales volume was up 12 percent to 1,540 from 1,380 a year earlier.

Data on sales that were pending in June but not completed suggest that much of the gain in sales in future months may be at the upper end of the market.

Pending sales of houses priced higher than $1.9 million are up 42 percent. That figure is up about 25 percent for houses between $800,000 and $1.9 million. But pending sales for houses under $800,000 are up just 5 percent.

In Oahu’s condominium market, sales in June rose 15 percent to 392 from 342 in the same month last year.

For the first six months of the year, condo sales totaled 2,308, up 19 percent from 1,943 a year earlier.

The median condo sale price last month rose 11 percent to $330,000 from $297,000 a year earlier.

Oahu’s condo market this year has been more consistant with median prices compared with the single-family house market, posting single-digit gains each month until the double-digit figure in June. So far this year the median condo price was up 7 percent to $326,750 from $306,000 in the same period last year.

UHERO projects that the median condo price will rise 7 percent for the full year.