David's Real Estate Blog | Dispatches from Diamond Head

Latest real estate news and articles from David E. Buck, Realtor-Broker

Aug. 23, 2016

Median Condo Price on Oahu up 14.3% in July

The median sales price for homes and condos on Oahu were up compared to last year, however not quite as high as June's record prices.

July 2016 Real Estate Sales Stats on Oahu

July 2016 Infographic of Real Estate Sales on Oahu

Single Family Home Stats

The median sales price of a single family home sale on Oahu was up 5.1% from July of 2015. Coming in at $746,000 it was still shy of the record $760,000 price we saw in June. As prices were up, the number of sales taking place on Oahu was down 4.5% with 322 sales taking place. Days on Market still favored Sellers with just 16 Days as the median.

Hoakalei Home for $745,000

Hoakalei-Ka Makana Home (MLS # 201616055) listed just under July's median sales price of $745,000

Condo Sales Stats

The surge in the median sales price of a condo was a huge jump as indicated by the title of my article. We saw a 14.3% increase since July of 2015 rounding the price out at an even $400,000. Although slightly off June's record (as well) of $405,000, we're really seeing the effects of people being priced out of the single family home market. The Average Sales Price took an even larger jump finishing at $459,859, which was an 18% increase from last year. We also saw a drop in Median Days on Market by 25% as it's now taking roughly 18 days to sell vs. 24 days a year ago.

Kapahulu condo for $400,000

This Kapahulu condo (MLS # 201618912) is listed for July's median price of $400,000

Serious Lack of Inventory

What's been driving the price appreciation? Once again, it boils down to simple economics of Supply vs. Demand. Here's what's happened to our inventory on Oahu since July of 2015:

  • New Single Family Home Listings were down 11.9%
  • Active Single Family Home Listings were down 4.5%
  • New Condo Listings were down 13.9%
  • Active Condo Listings were 11.6%

Notice the big difference in the active listings of single family homes vs. condos? The larger drop in inventory in the condo market translated into a larger increase in median sales price for condos. Interest correlation isn't it?

As always, all real estate is local. Here are the neighborhoods on Oahu that were hot for sellers and buyers in July:

Neighborhoods “Hot” for Sellers

Neighborhoods “Hot” for Buyers

  • Home sales in Aina Haina-Kuliouou were down 77%*
  • Home prices in Waialae-Kahala were down 10%
  • Condo sales in Makaha-Nanakuli were down 65%
  • Condo prices on the North Shore were down 11%

What’s Happening in Your Neighborhood?

Please consider these are broad overviews for regions on Oahu. To find out what is happening in your specific neighborhood (or street for that matter), feel free to contact me for more information.

* In Aina Haina-Kuliouou, there were 13 sales last year vs. only 3 this year. Since there were significantly less deals taking place at higher prices, the data was skewed a bit.

Aug. 2, 2016

Mount Terrace Condo Inventory on the Rise

Over the past 2 months, we've seen an influx of inventory at the Mount Terrace in Hawaii Kai. All 5 listings currently for sale have come online during that period. There's been equally as many sales with 5 transactions taking place over the past 6 months that ranged from $610,000 to $790,000.

Mount Terrace Condo from Kuliouou Beach Park

Everything around the Mount Terrace is green after Tropical Storm Darby's recent rainfall

Current Inventory at Mount Terrace

The most recent and noteworthy of these is the Penthouse F. It's not too often you see one of these hit the market.

Mount Terrace PHF Living Room

Mount Terrace PHF Dining AreaMount Terrace PHF Kitchen

Mount Terrace Penthouse F Living Area, Dining and Kitchen

As you can see, there's a lot of custom hardwoods throughout the unit. Not only do you have phenomenal east views facing of Koko Crater, Koko Head and the marina - the upgrades are truly special for someone looking for the luxury/Hawaiiana feel, which is hard to find in a condo in this day and age.

To learn more about buying or selling at the Mount Terrace in Hawaii Kai, feel free to contact me for more information.

July 25, 2016

Oahu Real Estate Prices Hit Record High in June

The median sales price for single family homes and condos hit record highs this past month on Oahu.

June, 2016 Real Estate Statistics on Oahu

Infographic of Oahu Sales Statistics for June, 2016

Single Family Home Stats

Jumping 8.6% from last year, the median sales price for a single family home on Oahu is now at an all time high of $760,000. It was also a significant bump from May's price of $719,000. Homes were trading briskly with only 14 days being the median days on market. Sales volume was the same as last year with 324 transactions taking place.

Keolu Hills Home for $759,000

Home in Keolu Hills (MLS # 201618511) listed just under June's median at $759,000

Condo Sales Stats

The condo market was up even stronger as the median sales price hit $405,500, which was a 19.8% increase from last year! While the home market remained the same with numbers of transactions, condo sales were up 9.6% with 548 transactions taking place. The median days on market also favored Sellers with just 20 days.

Marco Polo Condo listed for $405,000

Marco Polo Condo (MLS # 201616530) listed just under June's median at $405,000

Historical Data

Median Sales Prices on Oahu Since 1987. Note: New Record High

Now that we've hit new record highs, where do we go from here? Only time will tell... As always, all real estate is local. Here are the neighborhoods on Oahu that were hot for sellers and buyers in May:

Neighborhoods “Hot” for Sellers

  • Home sales in Makakilo were up 129%
  • Home prices in Makaha-Nanakuli and Windward Oahu were up 40%*
  • Condo sales in Waialae-Kahala were up 200%
  • Condo prices in Ala Moana-Kakaako were up 71%

Neighborhoods “Hot” for Buyers

  • Home sales on the Windward Coast were down 67%*
  • Home prices in Kalihi-Palama were down 10%
  • Condo sales in Diamond Head-Kapahulu were down 90%
  • Condo prices in Diamond Head-Kapahulu were down 67%

What’s Happening in Your Neighborhood?

Please consider these are broad overviews for regions on Oahu. To find out what is happening in your specific neighborhood (or street for that matter), feel free to contact me for more information.

* Last year there were 6 sales on the Windward Coast, whereas there were only 2 this year, which is why the data was skewed with less sales, however higher prices.

July 12, 2016

Cash Buyers Abound in Waikiki

I recently closed on a few deals in Waikiki where my Sellers received cash offers from Buyers eager to get in the market.

Ilikai Apartment Building #1603

Ilikai Apartment Building #1603 closed July 1, 2016

The first was a Mauka facing unit at the Ilikai. Within the first few days, we received 4 offers - all cash at or above the asking price. We closed in 30 days with an overseas investor that ended up paying $18,000 over asking.

Kaioo Terrace #101

Kaioo Terrace #101 also closed July 1, 2016

The second closing I had that day was also a cash deal where a mainland investor paid full price for unit #101 at Kaioo Terrace. With the uncertainty in the stock market, it's becoming more and more apparent people are looking at real estate as a vehicle to park their hard earned money.

Looking to Buy or Sell in Waikiki?

As you can see, cash buyers are in the marketplace. Feel free to contact us for a no-obligation consultation.

June 26, 2016

Getting Results in Kuapa Isle

A few weeks ago I was fortunate enough to have another closing at Kuapa Isle in Hawaii Kai.

Happy Clients use David Buck for Kuapa Isle

Recent sale of 425 Opihikao Place in Kuapa Isle

Demand for Kuapa Isle Units

We ended up getting a full price accepted offer in less than a week. There were a handful of interested parties, however 3 of them had to sell something first. This is a perfect example of how it pays to be ready to jump on something when it pops up. There's still lots of demand as there are two units in escrow and nothing available for sale.

Getting Results

Getting Results at Kuapa Isle

Over the past 2 years, Realtors have participated in 30 transaction sides at Kuapa Isle. I am fortunate enough to have represented a Buyer or Seller in 5 of those 30 sides, which is more than any other Realtor on Oahu. If you're looking to Buy or Sell at Kuapa Isle, feel free to contact me for more information.

June 23, 2016

May Home and Condo Prices Relatively Flat on Oahu

Residential real estate sales and prices were relatively flat in May when compared to 2015.

HBR Sales Stats for May 2016

Infographic for May, 2016 sales stats on Oahu

Single Family Home Stats

The median sales price last month was $719,000, which was up 3% from 2015. There's actually been 3 months over the course of the past year that were higher. Transaction sides closed experienced roughly the same increase (up 3.2%) with 319 deals that took place. Homes continued to move briskly with only 17 days on market.

Makaha Home for $719k

This Makaha home (MLS # 201612001) is listed for May's median price of $719,000

The most significant stat I noticed for the month is the average single family home sales price was down 13.1% from last year. What this really shows in my opinion is a continued weakening on the luxury market. Last May, there were 11 homes that sold north of $3 million. This year saw only 3 trades north of $3 million.

Condo Sales Stats

The median condo price for the month ended up at $373,000, which was down .5% from last year. Sales on the other hand were up 6% with 477 transactions taking place. Even more impressive was the days on market was just 15 days.

Diamond Head Beach Hotel Condo for $375k

Leasehold Diamond Head Beach Hotel Condo (MLS # 201601172) listed just over May's median

Unlike the large drop in average home price, the average condo price for the month was actually up slightly to by 1.9%. My suspicion is that it's because the luxury condo market was already starting to soften this time last year, whereas the single family home luxury market has been feeling the effects more recently.

As always, all real estate is local. Here are the neighborhoods on Oahu that were hot for sellers and buyers in May:

Neighborhoods “Hot” for Sellers

  • Home sales in Waialae-Kahala were up 233%*
  • Home prices on the North Shore were up 86%
  • Condo sales in Makaha-Nanakuli were up 120%
  • Condo prices on the Windward Coast/Kaneohe were up 204%

Neighborhoods “Hot” for Buyers

  • Home sales in Kalihi-Palama were down 73%
  • Home prices on the Waialae-Kahala were down 73%*
  • Condo sales on the North Shore were down 64%
  • Condo prices in Kailua-Waimanalo were down 35%

What’s Happening in Your Neighborhood?

Please consider these are broad overviews for regions on Oahu. To find out what is happening in your specific neighborhood (or street for that matter), feel free to contact me for more information.

* In Waialae-Kahala there were 3 sales with an average sales price of $4,590,000 in 2015. Whereas this year there were 10 sales with an average price of $1,244,000. This further supports my observations above of the luxury home market slowing down.

June 13, 2016

Kakaako Penthouses along Ala Moana Boulevard

This past week there were two Penthouses that hit the market in Kakaako. One was at 1350 Ala Moana, which was Kakaako's original luxury tower. The other is at Waiea, Kakaako's latest luxury tower.

1350 Ala Moana PH3

1350 Ala Moana PH3 View Over Ala Moana Beach Park

Penthouse 3 at 1350 Ala Moana (MLS #201614039) priced at $1,040/sq. ft.

The new listing at 1350 Ala Moana is a great bargain in my opinion. It's a 2 bed, 2 bath unit set one back off Ala Moana Blvd (PH 1 & 2 front the street) with 1056 sq. ft. of living area and priced at $1,098,000. The only downside to this building is the unit only comes with 1 parking stall. Other than that, it's a great value compared to all the new offerings in Kakaako and One Ala Moana across the street on the Diamond Head side.

Waiea Grand PH 36B

Waiea Grand PH 36B

Waiea GPH 36B (MLS # 201612214) is priced at $3,573/sq. ft.

Our company recently listed the Grand Penthouse 36B at Ward Village's first luxury tower of Waiea. As you can see from the rendering, it is apples and oranges when comparing to 1350 Ala Moana. The question one might ask is what justifies nearly 3.5 times the price/sq. ft? Well, as you can see it comes with your own infinity pool. This unit is also larger than most single family homes on Oahu with over 10,000 sq. ft. interior and offers 5 bed, 5.5 baths and 4 parking stalls.

Granted the asking price is 50% higher than the highest single family home offering on the island and over 3-4 times higher than the highest condo sale ever on Oahu. However, when comparing to other luxury markets across the globe such as New York, San Francisco, Sydney, Hong Kong, Tokyo, Singapore, London, Paris and Monaco I'd definitely have to include Honolulu in that mix... For someone with the means to purchase in this price range, this should be on their radar as well.

To learn more about these units or other Penthouse offerings in Honolulu, feel free to contact me for more information.

June 11, 2016

Summer is PCS Season to and from Hawaii

Summer is always a busy time of year for families PCSing to and from Hawaii. Working with our military families is something we take great pride in.

Hawaii Life Military Team

We Help Military Families with their Real Estate Needs

Now that summer is upon us, here are some great tips to set Buyer's expectations:

  • VA Loans are taking 45-60 Days with the new TRID laws
  • Well priced homes are still moving fast in the current Seller's Market
  • Have your pre-approval ready to go when house hunting

If you're a Seller, here are some pointers as well:

  • Be sure to find a good Realtor with experience helping Military Families
  • Keep in mind as well that offers with financing will take 45-60 Days to close (from acceptance)
  • Price the home well, unless you have backup plan to rent it out or comfortable paying 2 mortgages

I hope this helps and feel free to reach out to me for a free consultation and how we help our military families.

Posted in Military
June 7, 2016

Recap: The 7 Creators of Wealth in Residential Real Estate

This past week I attended our East Oahu Regional Group Meeting for the Honolulu Board of Realtors at Waialae Country Club. The guest speaker was Peter Savio, President & CEO of the Savio Group. He's been a successful real estate broker, investor and developer over the past 40+ years in Hawaii and shared with us some of his thoughts on why residential real estate can be such a great investment.

The 7 Wealth Creators by Peter Savio

Peter Savio's Speech on the 7 Creators of Wealth in Residential Real Estate

He started the talk about his background in having a degree in real estate, however never had much success in selling real estate. He grew up in a home were real estate is practiced and shared how his mother was a Realtor and was a "million dollar producer" back in the days when homes were only selling for $10,000 - so she had to sell a lot of homes to reach that figure. Once she taught him it's more about educating people than trying to sell them something, his career took off.

To this day he said all of his siblings (he is one of 5 children) are multi-millionaires by owning their own real estate and by doing so were able to stay in Hawaii and not have to move to the mainland in order to seek a better lifestyle and better paying job. Without further ado, here's what he had to share based on the notes I took:

The 7 Creators of Wealth in Residential Real Estate

1. Appreciation

This is one of the more obvious ones. When most people think of investing in real estate, their idea or "hope" is that you buy it and it goes up in value. Over time, this has absolutely been the case in Hawaii (and most part of the country). However, there are definitely market cycles and if you're looking to buy for a "quick flip", you could get stuck. He had a classic quote when one of the Realtors asked him about losing money when buying too high and he said just "don't buy stupid".

2. Leverage

This is another power of wealth creation by use of borrowing money. For example, if you buy a property for $250,000 cash and it goes up 10% in value, you make 10% off appreciation. However if you buy the same property for $250,000 with $50,000 down and borrow $200,000 and it goes up 10%, you'd then make a 50% return on your initial investment of $50,000 (which is 5 times as much as paying cash).

3. Mortgage = Forced Savings

For those that take out a mortgage on a property, every payment you make to the bank is like a forced savings account. This is in contrast to being a tenant. Every payment you make, you can never get back. Whereas during home ownership, every monthly payment builds your equity (in principal payments) by paying down the debt and you also have the tax benefits (see below).

4. Constant Monthly Payment = P & I is Fixed

Contrary to being a tenant where rates typically increase over time, having a mortgage allows you to have fixed (principal and interest) monthly payments. While home values increase over time, your monthly payments go unchanged. Granted property taxes and insurance rates will go up over time, however those increases are minimal when comparing to increases in rent.

5. Tax Advantages

Outside of the mortgage interest deduction, you also have your property taxes you can write off. In addition, he went on to say that on investment property you have other write offs and depreciation. I always advise clients to check with their CPA regarding tax advise.

6. Ability to Make Additional Payments to Mortgage (Savings Account)

You have the ability to make additional payments to principal to pay off your mortgage, thus increasing further leverage to your "forced savings account".

7. Interest You Earn on Additional Payments are Tax Free

For example, if you have a mortgage at say 4% and pay off $1,000 you'd thus be saving 4% that would have otherwise gone to the bank for interest and that savings is tax free.

3 Ways to Prevent Losing $ in Residential Real Estate

I'm not sure if you've heard of Warren Buffet's 2 rules of investing? They are:

1. Don't Lose Money

2. Don't Forget Rule #1.

Along those lines, Savio mentioned the 3 ways not to get burned in real estate:

1. "Buying Stupid" Ie. - if you're buying real estate with the idea of "selling to another sucker", he advises don't even bother buying in the first place.

2. Spending cash flow profits foolishly. Ie - on things that go down in value, Robert Kiyosaki (see below) refers to these as "do dads"

3. Moving Too Fast. Trying to build a portfolio too fast without managing your cash flow or trying to flip property is where you can get into trouble.

What is The Best Form of Wealth Creation?

According to Savio, THE BEST form of Wealth Creation is item #4 above, which is the constant monthly payment, This also follows along the lines of Robert Kiyosaki's philosophy of investing for cash flow. Similar to Savio's saying of "don't buy stuipid", Kiyosaki says "flippers are losers".

Want to Learn More About Investing in Real Estate?

Having been an avid real estate investor since first reading Robert Kiyosaki's book Rich Dad, Poor Dad 15 years ago, I practice what I preach. Unfortunately, there are a ton of Real Estate Brokers on Oahu that have no idea about investing in real estate, which is why Robert has the saying "they're called brokers, because more often than not, they are broker than you".

David with Robert and Kim Kiyosaki

Here I am with Robert and Kim Kiyosaki at a Book Signing in Kahala

One of the first thing's I'd ask when interviewing a Realtor is asking them if they personally own any investment property. My guess is 90% of the agents on the island do not. It's also sad that I also know tons of Realtors that don't even own their own home... If you're interested in residential real estate investments, feel free to contact me for more information.

May 29, 2016

Aloha Shirt Book Author's Palolo Valley Home for Sale

I have the pleasure of listing one of the most unique properties in town. It's a home tucked away in the way, way back of Palolo Valley off a private road. It's the home of Dale Hope, author of The Aloha Shirt.

Palolo Valley Estate

Palolo Valley Estate (MLS # 201513352)  set in the way... back of Palolo Valley

This is such a special place and not many people know about it. When most people think of Palolo Real Estate, they think of old single wall construction (often times cpr'd) plantation style homes built in the 50's in a high density area with 5,000 sq. ft. lots (or less). Comparing this property to those is like comparing apples to oranges. Once you get in the back of the valley, through private road access - it literally feels like you're on the North Shore or a neighbor island. Set on nearly an acre, this offers "country living", yet you have all the conveniences of town.

Palolo Valley Home, Honolulu, Hawaii 

The video here give you an idea of the space, privacy and all that is offered in this rare opportunity.

Bargain Compared to Competition

If you're in the market for something in the $3-3.5 million range in town, some of the options are McMansions in interior Kahala on a quarter acre lot (with not much privacy) or perhaps a newer condo in Kakaako in a building like Waiea or Hokua and having high maintenance fees and very little living area...

Living "Off The Grid"

Although not completely off the grid, this home was revolutionary when built with a 15,000 gallon water catchment system, environmentally friendly composting toilet and also PV (Photovoltaic) panels to offset energy use.

Outdoor Space

Palolo Rainbow

Hot Tub in Palolo Relax in a Hammock in Palolo

Outdoor life in Palolo

Hawaiian Style Decor

Palolo Hawaiian Home

Palolo Entry Palolo Hallway Palolo Living

Welcome home to Aloha...

Previous Home Accolades

More Information

Mr. Hope has recently returned from a book tour across the mainland. In addition to the references above, the home has also been featured in numerous photo shoots for the retail industry domestically and in Japan, where the Aloha Shirt Book has also launched in Japanese.

For more information or to schedule a private tour (for qualified buyers only), feel free to contact me for more information.

Posted in Honolulu, Luxury, Palolo