It looks like Hawaii condominium market has hit the bottom in 2009. The average price for condominiums shows some increase. Let’s take a look at the condominium market this month. Following graph shows you the average price of condominium (for 2-bedroom units with at least 1 parking stall) in Oahu (dark blue), in Kakaako (pink) and in Waikiki (yellow). It is clear that the condominium price in Oahu recorded a drop in 2008 and 2009 and has started to increase in 2010. In Kakaako and Waikiki, however, the average price started going down in 2006, but it shows an increase in 2010. Why did Kaka'ako and Waikiki condo market start slowing down in 2007? It is because these areas are primarily second home markets and affected by visitor arrivals, especially from outside of US. Let’s take a look at the international visitor arrivals from 2000 through 2009 (statistics for 2010 is not ready yet). Although the number of visitors from US mainland kept increasing until 2008, the number of visitors from outside of US, especially from Japan started decreasing in 2005 (3% decrease in average from 2005 through 2008). The increase in tourism brings much needed relief to hotel condominium owners because higher occupancy leads to higher revenues. Tourism has started to pick up these days, and Waikiki and Kaka'ako condo markets will benefit from this trend. Of course, nobody has a crystal ball for the future. However, with the optimistic prediction for Hawaii tourism and the statistics, it is more likely that the second home condo market remains strong and the price trend may continue. If you are thinking about purchasing properties in Kakaako and Waikiki, it would be better to make a decision quickly before the prices go higher. Call me today for more information!
Quick Market Stats (The data are compared to the same month last year.) Number of Sales Condominium: 310 (-21.3%) Single Family: 241 (-16.9%) Median Sales Price Condominium: $300,000 (no change) Single Family: $595,750 (-1.4%) Days on market Condominium: 34 days (-20 days) Single Family: 35 days (-17 days) Inventory Condominium: 2,070 (-5.4%) Single Family: 1,472 (-11.3%)