HONOLULU (HawaiiNewsNow) – After a record 2021 for home sales, Oahu real estate experts are planning for the market to remain competitive and for prices to keep increasing.
According to the Honolulu Board of Realtors, last year saw nearly 12,000 sales, 7,000 of which were condos.
The current median price for a single family home is over $1.125 million and just last week, the Federal Reserve raised interest rates, which now stand around 4.5%.
HBR president Chad Takesue says it’s still too early to tell what kind of impact the rate hike will have.
He doesn’t think prospective homebuyers will be discouraged, but may reassess their options.
“Sometimes you’ll see a shift of people who are initially looking in the single family market shift towards a condo as an option, mainly because of price point and the inventory available for condo market versus single families,” Takesue explained. “So you’ll see some of that shifting with rates going up.”
February sales in Waikiki and Kakaako saw a 64% and 53% jumps, respectively, compared to last year.
Takesue adds that despite higher interest rates, Hawaii typically has strong- long term appreciation, so regardless of when a home is bought, the investment should gain value.
Appreciation which is partly driven by competition from Hawaii’s low-inventory.
“We just keep lagging behind how many homes are needed to fill the demand every year,” Takesue said. “Regardless of if it’s an up market or down market, we’ve been trailing for so long. On the flip side, it’s also why you hold your value here once you buy whereas in other mainland markets, there’s a lot more fluctuation when the economy fluctuates.”
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