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Noticed last night that the parking lot across from Ward Theaters is blocked off. The lumber is on the lot to put up the construction barrier. Trees that are going are marked. Post holes are done for the wall too. Will be interesting to see that building go up. Unreal how much of an impact it will have on that area though. I have no doubt that the view those owners will have will be nothing short of amazing....and expensive.
Just over your time period, one of my Diamond Head 1 bedroom units went from $850 in 2001 to just under $2000 today. Do the math.
I don't know anyone (including myself) that has increased rents 135% over the last 13 years without extensive remodeling. Maybe you left that little important fact out? I'm obviously talking about units that have not incurred significant upgrades- just standard maintenance. Another thing to consider is maybe $850 was WAY below market in 2001 and you simply brought rents up to market today??? I've bought two bdrm units in town where they were renting for $800/mo. The tenants were there for over 40 years with extremely small rent increases. I had them removed to do extensive rehab work (the houses were literally falling down) and they moved back in for $1,300/mo. That was a 60% increase in one year!!!!! But still, their rent was a good few hundred below market so they were very very happy. Everything is relative... but your 7% average annual increase in rents (without significant upgrades or dramatic neighborhood gentrification) is waaaaaaaay off.
Possibly location? I saw on hotpads unit 1003 two bedroom was renting for $2500. $700 seems a big difference between a one bedroom but I don't know the building. Pick a building that's been around 30 years and state current market rent. Then regress it 30 years at 3%. See if that is anywhere near actual rent.
Huh? $700/mo is actually a small increase from a standard size one bdrm to standard size two bdrm. It's usually closer to $800 to $1,000... or possibly even more if it's comparing a 1/1/1 and a 2/2/2 (vs a 1/1/1 and 2/1/1). That extra full bath and parking adds $$$.
Yes, rents since I've been renting out units myself in late 1990's and today have increased roughly 3%/year. Yes, it was much higher during the 70's, 80's and early 90's but that's because inflation was roughly 50%-100% higher in the 70's and 80's than it has been the last two decades. High inflation will impact rents dramatically but we haven't been in a high-inflation environment for a very long time. Of course that can change in the future but even then, the rents will likely not bump up to a consistent 6-7% year like you erroneously state it has been in the past.
To give you an idea how insanely ridiculous your "factual" 7% increases are, if your rent was $1,400 for a 4 bdrm single family home in Hawaii Kai in 1980 (that's what my parents paid), it would rent for $13,970 today. Not too many houses renting out there for that much, huh? You may want to check your math again. LOL.
I don't know anyone (including myself) that has increased rents 135% over the last 13 years without extensive remodeling. Maybe you left that little important fact out? I'm obviously talking about units that have not incurred significant upgrades- just standard maintenance. Another thing to consider is maybe $850 was WAY below market in 2001 and you simply brought rents up to market today??? I've bought two bdrm units in town where they were renting for $800/mo. The tenants were there for over 40 years with extremely small rent increases. I had them removed to do extensive rehab work (the houses were literally falling down) and they moved back in for $1,300/mo. That was a 60% increase in one year!!!!! But still, their rent was a good few hundred below market so they were very very happy. Everything is relative... but your 7% average annual increase in rents (without significant upgrades or dramatic neighborhood gentrification) is waaaaaaaay off.
I'm using actual lease numbers. This is Pualei Circle area and Waikiki. Show me some upgrades you can do to a 600sf one bedroom apt. to increase rents 4% annually. As far as gentrification, well it is Diamond Head/Waikiki so probably rents have increased more than say, town. Location, location, location. You get what you pay for. You still haven't addressed how rents are so high if they've only increased at the rate of inflation. Bunch of Hawaiian *******? I notice you also haven't picked a current Waikiki market rent and regressed it to 1980 rents. Give us some streets/ neighborhoods and give 1999 rents and current rents.
"An analysis of the local rental market shows a similar upward track – averaging roughly $1,000 per month rent for a single-family home in 1985, around $1,500 per month in 1995 and well over $2,300 per month today. Are you prepared for the prospect of your rent doubling every 20 years? Or might it make more sense to lock in a mortgage payment now for the next 30 years?
The attached article is from 2010 - I believe it is moving at an even faster pace now.
"An analysis of the local rental market shows a similar upward track – averaging roughly $1,000 per month rent for a single-family home in 1985, around $1,500 per month in 1995 and well over $2,300 per month today. Are you prepared for the prospect of your rent doubling every 20 years? Or might it make more sense to lock in a mortgage payment now for the next 30 years?
The attached article is from 2010 - I believe it is moving at an even faster pace now.
And those figures are distorted to the low side since PJ guy hasn't raised rents on his couple of dozen rentals since 1907!
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