Oahu single-family home price weakened in September

The median resale price for Oahu single-family homes dipped in September to its lowest point for any month this year amid more demand from buyers as average interest rates rose above 7%.

Previously owned single-family homes on the island sold for a median $1,110,000 last month, down 3.9% from $1,155,000 a year earlier, according to a Honolulu Board of Realtors report released Tuesday.

The price decline was modest, but it followed three straight months of increases over 10% and was bigger than two other decreases earlier this year — dips of 1.7% in April and 0.8% in May.

On the other hand, the number of sales rose 6.2% to 293 in September from 276 in the same month last year.

Oahu’s condominium market, meanwhile, conversely saw fewer sales and a higher median price in September.

There were 375 condo resales last month, down 8.1% from 408 a year earlier, while the median price edged up 2.8% to $523,000 from $508,750 in the same period.

The median price is a point at which half the sales were for more and half for less.

Aaron Tangonan, president of the trade association, said recent upward pressure on mortgage rates is adding another consideration for buyers as they evaluate how much they can afford in monthly mortgage payments.

“We’re seeing relatively steady buyer and seller activity in the single-family home market, even as conditions vary across neighborhoods,” Tangonan, an agent at Honolulu Real Estate LLC, said in the written report. “In the condo market, the pullback in pending sales across price points and most regions suggests buyers are taking more time to weigh borrowing costs and their options.”

According to Freddie Mac, a national mortgage buyer, the average interest rate on a 30-year fixed-rate home loan was 7.28% during seven days through Oct. 1, up from 7.03% a week earlier and 6.34% a year earlier. The last time average interest rates were above 7.28% was in November 2023.

The University of Hawaii Economic Research Organization said in a Sept. 25 report on the state economy that local housing affordability has deteriorated this year in part due to rising mortgage rates and modest price growth.

“Even small rate increases meaningfully affect what households can afford,” UHERO said in its report.

The organization calculated that the monthly cost of financing a roughly $1 million single-family house with a 20% down payment and a conventional 30-year fixed-rate mortgage has risen $270 this year, to $5,295 from $5,025. For a median-priced condo, interest rate increases have added $140 to the typical monthly payment for buyers, UHERO added.

UHERO’s report also said maintenance fees for condo ownership in Hawaii have increased 60% since 2000 after accounting for inflation, and that the monthly fee for most condo owners is over $800, or 50% more than the national median.

Over the first nine months of 2026 compared with the same period last year, Oahu median home sale prices were up 3.1% to $1,180,000 for single-family houses, and up 2.5% to $515,000 for condos.

Sale volumes for the same comparable period were up 5.9% to 2,243 for single-family houses, and down 2.4% to 3,209 for condos.

Chad Takesue, interim CEO for Hawaii real estate brokerage firm Locations, described Oahu’s housing market in a company report on Tuesday as being stable this year through September, but noted that the market outlook for 2027 continues to be shaped by the interest rate environment and other factors.

“Although rates are still expected to fall below 7% in 2027, continued global conflict and uncertainty about U.S. economic conditions could create some volatility,” Takesue said in the Locations report.

UHERO expects mortgage rates over 2027 to average around 6.7% and help make homes more affordable along with expected changes in home prices and incomes.

“Because we expect rates to remain above 6.5% for the foreseeable future, there will continue to be headwinds for market recovery,” UHERO said in its report. “But affordability will gradually improve as household incomes grow and home price gains fall below inflation, permitting slow market progress, barring another step up in long-term interest rates.”

UHERO forecasts that the median Oahu single-family home sale price for all of this year will rise 4.0% to almost $1.19 million, and then edge up 1.5% in 2027 to about $1.2 million. And for condos, the organization expects the median sale price will rise 2.1% this year to about $515,000 and then eke out a 0.3% gain to about $517,000 in 2027.
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