Overall, the Honolulu Market continues to go from strength to strength, with price increases unbothered by increasing inventory. Often, when inventory rises, prices take a hit as buyers with more choice have increased bargaining room. Not in Hawaii. The only hint of more inventory has been an increase in days on market
For single-family homes, the median time to sell was 29 days compared with 15 days a year ago – nearly double the time. However, for condos, days on market only increased from 21 days last year to 25 days in October 2018. The inventory bump has been welcomed by Darryl Macha, president of Honolulu Board of Realtors.
“The inventory of homes and condominiums available for sale has been rising, providing more options for potential homebuyers and leading to an increase in the days on market,” Macha said. “Oahu’s housing market continues to be a stable environment for both buyers and sellers.”
Honolulu’s Gold Coast is a scant half-mile stretch of oceanfront high-rises at the foot of Diamond Head. You may think that Hawaii has the same unending tonnage of oceanfront high-rises seen around Florida, not true. Within Honolulu, there are just 18 oceanfront residential high-rises. Seventeen are on the Gold Coast, and one in Waikiki. None are newer than 1970, with most dating to the 1950s and 1960s. Typical condos sell between $1,500-to-$2,200-plus per square foot.
Built in 1958, the 12-story Tropic Seas isn’t the toniest building on the street, but that’s where bargains reside. Unit 203 is just such a bargain. The one-bedroom unit has 618 square feet with an additional 121-square-foot lanai. You know there’s a renovation needed when the first listing photo showing the interior is the 13th of 19 photos. But at $499,000, that’s $675 a square foot.
5050 Lawai Rd APT 310 Koloa, HI is currently listed for $1 million by Mical Kit Owen of Oceanfront Sotheby’s International Realty.
Ever wonder how far your money would go somewhere else? Perhaps you’re in the market for a vacation home or second shelter to recharge and renew. Well we are scouring the top markets to answer the burning question: “What can I get for a million in …?”
This week we center on Hawaii, a dream-like paradise for anyone who loves the surf, the sand, and the salty ocean breeze. From afternoon rainstorms, to unbelievable geological terrain, and yes, double rainbows, let’s see how far our money will go in the current Hawaii marketplace shall we?
Ocean Views from Everywhere. Second floor shows Master Bedroom.
Talk about location, location, location — 202 Kaikuono Place in Honolulu is two doors away from what’s arguably the most famous piece of residential property in Hawaii, Doris Duke’s Shangri-La estate. Both are located on the ancient lava flow “toe” that juts out into the Pacific called Black Point. It’s one thing to say you live in Diamond Head, but to call Black Point home raises your cred exponentially. It’s been estimated that were Duke’s five-acre oceanfront estate ever to make it to market, it would be the most expensive piece of residential real estate in the state. And it’s two doors down.
Hawaii is where “Million-Dollar Views” really do cost millions of dollars
Last week we saw the sexy, unattainable house porn of Oahu. Now let’s be realistic. You don’t need millions to realize a dream of a second home in Hawaii. When looking for a home in Hawaii, it comes down to location, location, and size. Let me explain.
Location: The further a home is away from the ocean, the less expensive it will be until you start looking uphill. The further uphill you get, prices increases will follow. Sure, there are certain areas and neighborhoods that are generally less expensive. These areas target more local buyers who want typical homes without the ocean views second home-buyers generally clamor for.
Location: In this case, location equals view. When looking at a high-rise condo, what can you see? Will that view change (likely), and how detrimental would a view change be? Is an oceanfront building with a unit facing the garage better than a unit several blocks away from the ocean with good ocean views better? Often the price (factoring in size) can be similar. Many are in Waikiki, but I chose units on the fringe so you get the convenience without the tourist throng at your doorstep.
Size: How large of a space do you want? Size and price often will dictate both location variables. If you’re a single person, a few hundred feet of paradise may suit, but if you’re looking to house a family, probably not.
A single-family home on the water will be millions, but there are other alternatives. I’ve not discussed them in this column, because the easiest ownership will be a lock-and-go condo that has rental potential (if you need help with fees and perhaps a mortgage). Here’s smattering of what’s available in the Honolulu area from the $200,000 to $1m. I chose Honolulu to focus on first because I know it best, has the most selection and is the easiest to area rent.
The Honolulu real estate playing field was at one time dominated by local brokerages that over time were acquired by national brands like RE/MAX, Prudential and such. Often what was gained in national presence was lost at the local level with layers of mainland management out of touch with the islands. Also, like many conglomerates, technology tools were not the best. Bradley told me of one of her agents who had been screaming for years for a way to embed a video into an email – no link, no Dropbox. Spoiler alert: now she can film a property on her phone and embed the impromptu tour into an email to her client from her phone.
1,820 oceanfront square feet. A snip at $4.69m
One of Berkshire’s first real estate acquisitions was Prudential. Apparently, franchisees had the option of opting out and that’s what Hawai’ian offices did. With no presence in high-priced Honolulu, Berkshire approached Bradley and a select group of agents to be their start-up in Hawai’i. Little did I know how timely my meeting would be.
Figure 1: Recently Approved Phase 2 of Hughes’ Kaka’ako Plans
The market for Honolulu condos makes Dallas look like Sleepy Hollow. Even the ultra-tony Bleu Ciel with its recent price hikes is only pricing its smallest unit at a meager $640 a square foot. Compare that with still-being-built Honolulu high-rises Anaha and Waiea where a 435-square-foot studio on a no-view floor will run ya nearly double that.
And while sales in Dallas for these costly homes chugs along, Bleu Ciel, Museum Tower and its kin must dream of Hawai’ian voraciousness with 2016’s Anaha already 80 percent-plus sold. After a recession hiatus, Honolulu is again seeing buyers (likely their staff) camping out on sidewalks when new blocks of units are released for sale.