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Ah. That just would be incorrect. It is about supply and demand. If prices were to high they'd come down. It is a sellers market right now. Buyers need to pay more to get in the game.
There goes the supply and demand argument again, its not that im arguing that there isn't supply and demand. Its just the way its used appears to justify behavior. Like supply and demand is some creature that has a life of its own that we are all powerless against. Supply and Demand and markets can be manipulated. Its always been a sellers market in Hawaii in recent times. Thats why its one of the most expensive housing markets in the country. But i agree buyers need to pay more to get into the game and will have to pay even more in future. If trends continue statewide.
Further even if supply was high on housing, im confident to say that Hawaii will always be expensive for housing because we will be paying the paradise tax.
I think low sales figures meaning single family housing(Not Condo Totally different Market) Tells me that prices are to high. Incomes are stagnant and inflation is low no justification for the higher prices . The sales figure are bearing this out. In the next 6 months will tell.
Low number of sales could be an indication of a good market or a slow market. The key component is inventory.
If you have low, or dropping number of sales combined with low or dropping inventory of available properties for sales, then you have a strong market and likely will see rising or stable pricing. Typically a sellers market.
If you have low (or dropping) number of sales combined with a high (or rising) inventory of available properties, then you have a soft market and likely will see prices softening or dropping ... typically a buyers market.
So if you have noticed what you believe is a low number of sales for the location you are looking at, then you can do a little more research and chart the changes in inventory over the past 12 months to get a better idea of where your market is at. Low sales and low (or dropping) inventory, would indicate a strong market with steady or rising pricing. Low sales with high (or increasing) available inventory, would indicate a softening market with possible downward pricing pressure.
In recent years, many markets in Hawaii and elsewhere have seen a dropping number of sales along with dropping inventory ... as seen most easily in rising prices.
If you look back to 2009, for example, you would see low sales numbers with rising inventory of available properties and softer pricing.
There are plenty of homes on the market. The problem is affordable housing.
"Plenty" is subjective. Rising or declining inventory in conjunction with a low volume of sales is the key to determine the markets condition relative to pricing and how it may be trending.
"Affordable" is also subjective.
So if you feel there are "plenty" of homes on the market, but that they are not "affordable" based on your review and interpretation of the market, then you have the answer that is right for you.
What % decline in the current median price would you need to see in the market you are examining before you feel housing would be correctly priced ? In other words, if you feel housing in your market area is currently over priced and sales are low because of it, what sort of pricing correction are you anticipating and how soon do you expect to see the pricing drop ?
I pay attention to Oahu pricing and I can tell you that pricing has been rising over the past few years. The total number of sales has also been slowing but inventory has also dropped over that same period. So it remains a sellers market with price appreciation even though number of sales are trending down. And while price may be high compared to other markets or even as a ratio of median price compared to median income, many sub-markets in Hawaii have outside influences that skew those numbers because it is not a purely "local market". It has international influences.
But it sounds like you have already arrived at your answer base on your evaluation above. And if you're analysis indicates prices are too high, then I'd suggest looking for a different market or waiting until this one starts dropping.
Its always been a sellers market in Hawaii in recent times. Thats why its one of the most expensive housing markets in the country. But i agree buyers need to pay more to get into the game and will have to pay even more in future. If trends continue statewide.
Further even if supply was high on housing, im confident to say that Hawaii will always be expensive for housing because we will be paying the paradise tax.
Ah, they mythical paradise tax again.
Anyway. You clearly weren't here in 2008 when housing prices dropped dramatically and took nearly 5 years on Oahu to recover.
However, this thread is specific to the Big Island - and more so, specific to the Kona area. If you had been to Hawaii in the mid-2000's, specifically the Kona side of the island you would noticed housing developments being built extensively and despite all the land in the area, many of these developments packed in as many houses as possible. Then the crash of 2008 came - a lot of those new houses sat empty and unsold. For years. It wasn't even worth it for the bank to foreclose because nobody was buying. Out of the entire island chain - the Kona side of Hawaii was hit the hardest in the 2008 housing crisis. Only recently in the past couple of years have many of the houses been sold/occupied.
I have all the MLS sales statistics data for Kona in a convenient, easy to read table with sales referenced by previous months and over the previous year.
I have all the MLS sales statistics data for Kona in a convenient, easy to read table with sales referenced by previous months and over the previous year.
Well ... please share with us how the data appears to be trending over the past year and your interpretation of that data. I would be interesting in hearing about this.
People aren't interested in selling when real estate prices are going up so much. Low inventory is an indicator of a strong real estate market. Sales often go up in a poor economy.
"The news from residential real estate on the Big Island is encouraging. "I think median price will continue to rise, but not in the double digit figures we saw during the past two years. As the availability of lower priced inventory continues to shrink, and demand remains steady and even increases, prices will continue to rise. Until more home inventory is brought onto the market, the demand side will outweigh the supply side, and prices will continue to increase," stated Bill Babbitt, a Realtor with Century 21 All Islands Realty in Waikoloa.
The number of single-family homes sales on the Big Island in November dipped from 162 to 142, a 12 percent decrease for the month. The number of sales is about 2 percent fewer compared to 2013 year to date. Although the number of sales was down for the month, dollar volume for single-family home sales for last month is up by 24.5 percent. Year to date compared to 2013, dollar volume for single-family homes is up 2.4 percent. Sales volume for condominiums for November is down a whopping 47 percent, while down only 5 percent year to date. The median price for a single-family home on the Big Island is $317,000, up 7.5 percent over 2013 and for condominiums the median price is $286,000, up 12 percent over 2013. The median price for vacant land is $27,250, a slight decrease of 2.7 percent compared to 2013.
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Why ?
