David's Real Estate Blog | Dispatches from Diamond Head

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

Dec. 11, 2019

Parking or No Parking?

One of the features of Bill 7 is there’s no requirement for on-site parking. It’s expensive to build a parking garage large enough to provide space for one or two cars for each apartment so, to keep development costs lower, Bill 7 does not require parking.  

Honolulu Parking Stalls

Parking Stalls in Honolulu

In the current market, does it make sense to build an apartment building with no parking spaces? In many neighborhoods, on-street parking is already tight. Will buildings that don’t offer parking be harder to rent? Will they have higher vacancy rates? Will the rents be lower than rents in similar buildings that do have tenant parking? How much does parking impact the profitability of a project?

Parking Options

The least expensive parking solution is to use the ground level of the building for parking by raising the first level of apartments to the second floor. Bill 7 allows ground floor parking spaces to encroach into the side and rear yards of the building, but despite that allowance, in most cases one level of parking will provide a parking space for just about half of the proposed units in a typical Bill 7 project. If the building has fewer than one parking space for each apartment, tenants who want a parking space would compete to rent the available spaces and some tenants would be unable to rent a parking space.

Mechanical parking systems can provide an alternative. These systems “stack” vehicles so that twice as many cars can park in the same ground floor parking area. These systems have proven reliable and efficient in urban markets around the world, and the monthly rent tenants pay for a parking space would cover the increased cost of purchasing and installing the system. Cars parked in mechanical parking systems also may be more secure since access to the cars is limited to tenants.

Transportation planners in Honolulu believe residents’ transportation habits already are changing and a growing number of people will choose to ride a bike, use a car sharing service (Servco), an on-call driver service (Lyft, Uber) and/or mass transit instead of owning a car. In the meantime, what is the best parking configuration for a Bill 7 property? The best solution depends on the size and shape of the property, the distance between the property and a rail station or bus line and the unique characteristics of the community.

What is a parking space worth? Let us help you decide.

Dianne Willoughby, Realtor

808-347-9945

DWilloughby@HarcourtsHi.com

Posted in Bill 7
Dec. 7, 2019

Pearl Harbor, Alfred Preis and Manoa Home Doubling Asking Price in 5 Years

As we take time this weekend to reflect on December 7th and Pearl Harbor, millions of people across the country will see views of the Arizona Memorial, whether it be online or television. One such news publication did a story titled ARTS and HUMANITIES: Contemplating the Lessons of Pearl Harbor. In addition to reflecting on Pearl Harbor, the article discusses the architectural attributes of the Arizona Memorial designed by Alfred Preis.

Alfred Preis Home at 3247 Melemele Place Re-Launched

Alfred Preis Home at 3247 Melemele Place (MLS # 201931347) in Manoa

Preis Manoa Home Doubles in Asking Price 5 Years Later

Over the years, mid century modern homes done by Alfred Preis are harder and harder to come by. This one in Manoa was last on the market back in 2013 and later sold back in 2014 for $940,000. After closing that year, the owners went through an extensive remodel where they kept a lot of the signature architecture feel of the exterior with doors, windows, etc. and use of ordinal hardwoods. Most of the money and changes went into some nice kitchen and bathroom renovations.

3247 Melemele Place Living Area

3247 Melemele View Left 3247 Melemele View Right

Original Feel of Home with Windows and Hardwoods

3247 Melemele Remodeled Kitchen

3247 Melemele Remodeled Bath 3247 Melemele Bathroom with Tub

Remodeled Kitchen and Bathrooms

Although our real estate market on Oahu hasn't doubled in the past 5 years, this will be a good one to watch as homes by Alfred Preis have become more and more valuable over the years. Combined with these renovations, whether the price actually doubles or not, my bet is the ultimate sales price will far exceed what the overall market has done.

Dec. 6, 2019

Mililani Seller Testimonial

Karen Morineaux recently sent a nice mahalo card in thanking David for his help in the sale of her Mililani condo.

Cathedral Pt. Condo in Mililani

Karen Morineaux, Kealia, HI

I know how late this is coming in but time just seems to slip away. I wanted to say thank you for all you did in making Mililani sell. I know it was small potatoes, but I wanted you to know it was appreciated.

Posted in Mililani, Testimonials
Nov. 30, 2019

October Local Market Report

Single Family Home Update by David

Niu and Aina Haina Valleys

Homes in Niu and Aina Haina Valleys

We saw the largest increase in the number of sales between Aina Haina to Kuliouou in East Honolulu. That was a contrast compared to last month where we saw a big increase out on the west side in Makaha and Nanakuli. That increase was up 86% in the number of sales compared to last year.

Makiki Rainbow

Makiki Homes under a rainbow

For the median sales price, we also saw the largest increase here in town. Makiki-Moiliili was up 21% finishing up at $1,372,500!

Condo Update by Dianne

In October we had 10 condominium local markets where the sales increased. We had 7 markets where the number of sales decreased and there were 3 markets with no change in the number of sales.

Bluestone Condos in Windward Oahu

Bluestone Condos in Windward Oahu

The windward markets were very strong with the number of sales in Kailua-Waimanalo more than doubled in October of this year compared to last year from 6 sales last year to 13 sales this year. The number of sales in Kaneohe also doubled from 8 sales last year to 16 sales this year.

Kapahulu Ave Condos

Condos off Kapahulu Ave near Diamond Head

The median sales price was lower in four of our neighborhoods compared to last year. The largest decrease was in Diamond Head-Kapahulu where there was a 40% drop in the median sales price. That just demonstrates the market's volatility because last month Kapahulu had the largest increase in median sales prices.

Ala Moana to Kakaako Condos

Ala Moana and Kakaako Condos

In thirteen of our neighborhoods the median sales price increased compared to October last year. The largest price increase was in Ala Moana-Kakaako where the median sales price was up 94% compared to last year.

Contact a Local Expert

Every home is different. Every neighborhood is different. If you'd like to find out what this means for you, contact us at Harcourts Island Real Estate - 808-777-4880.

Nov. 24, 2019

Bill 60 to Ammend Bill 7 by Removing Rent Caps

Changes to Affordable Rent Requirements in Bill 7 Proposed in Bill 60

Honolulu Department of Planning and Permitting

It’s been six months since Mayor Caldwell signed Bill 7 to encourage private sector-funded, higher-density redevelopment of Apartment and Mixed-use properties of 20,000 square feet or smaller. Bill 7 provides incentives for private developers to increase the number of rental units that can be built and reduce some development costs and taxes in exchange for a commitment to rent at least 80% of the apartments to tenants who earn no more than 100% of the Area Median Income (AMI) at rents that are set by the department of Housing and Urban Development as Area Median Rents.

Bill 7 - 6 Months Later

In the six months since the Bill was enacted, only two applications for building permits have been submitted to the Department of Planning and Permitting. Both were filed in October and are currently being processed. Given the opportunity Bill 7 provides, why have there been just two applications so far?

One Stop Permit Center Honolulu

Are the rent caps to blame? Some bankers and developers believe that the HUD rent caps are part of the reason that there haven’t been more Bill 7 development applications submitted to DPP. People who own qualifying properties may be wary of rent caps because they believe the market should determine what the apartment rents will be. Some property owners may be deterred by complicated reporting requirements.

Bill 60

Bill 60 proposes amendments to Bill 7 that will eliminate the requirement for rents to conform with 100% of Area Median Rents and will allow owners to charge market rents. Some advocates for low income housing worry that this will reduce the number of “affordable” rental units developed under Bill 7 and developers will take advantage of the Bill 7 incentives to build rental apartments that are too expensive for working families to afford.

Bill 60 was given initial approval by the City Council Zoning, Planning and Housing Committee on November 14 and will go to the full City Council for the second reading. What do you think about this proposal?

For more information on Bill 7, contact:

Dianne Willoughby, Realtor 

808-347-9945

DWilloughby@HarcourtsHi.com

Nov. 22, 2019

October 2019 Market Update for Oahu Housing

David E. Buck and Dianne Willoughby discuss the real estate market update for October on Oahu.

Single Family Home Stats

Ocean Pointe Home in Ewa Beach asking $780k

This Ocean Pointe home in Ewa Beach (MLS # 201919444) is asking $780,000

We finished the month off with a median sales price of $780,000, which was a 2.5% decrease from October of last year. Meanwhile homes were selling 20% faster with just 23 days on market, compared to 29 days last year. We also saw a surge in the number of pending sales which were up 15%. That's showing some strength in the market and we look forward to a strong November.

October 2019 Housing Stats on Oahu

Single Family Home and Condos Stats Year over Year and Year to Date

Condo Stats

Waikiki Condo for $440,000

This Waikiki condo (MLS # 201930386) is listed at $440k - just under October's Median

The median sales price for October of 2019 was $441,000. It's an increase of 13% compared to October of last year. The number of pending sales at the end of October was 642. That was an increase of 9% compared to October of 2018. This may give us an indication that November may be a very strong month with a lot of closings. Our months of remaining inventory went from 3 months to 3.8 months of inventory. That's an increase of 26%, which may be a slight indication that the market may be slowing.

Each market is different and each home is unique. If you'd like to find out what this means for you, contact us for more information.

 

Nov. 18, 2019

Example of Bill 7 and a 5,000 Square Foot Property

An Example of what Bill 7 Can Mean for a 5,000 Square Foot Property

Example of a Building Style for Bill 7

What can be built on a 5,000 square foot lot that qualifies for Bill 7 incentives? Every property is unique, so we encourage you to contact us for a quick analysis of your property; but here is a sample of what might be possible.

If we start with a 5,000 square foot lot measuring 50’ by 100’ and a 60-foot height limit, the street front setback is 10 feet and side setbacks are 5 feet. The ground floor can be used for parking spaces, rental apartments or commercial space if the underlying zoning allows commercial use. (Note that tax incentives and fee waivers apply ONLY to the portion of the project that is to be rented to tenants who earn 80% to 100% pf Area Median Income for qualifying rents.)

With an allowable Floor Area Ratio (FAR) of 4.0, a 5,000 square foot lot might support a 20,000 square foot building with up to 25 apartments. The maximum number of apartments that can be built is calculated by dividing the maximum allowable FAR by a factor of 800 and rounding down to the next whole number.

For more information on Bill 7, contact:

Dianne Willoughby, Realtor 

808-347-9945

DWilloughby@HarcourtsHi.com

Nov. 11, 2019

Historic Ossipoff Home For Sale in Puupanini

This past week a special Vladimir Ossipoff designed home on the historic register hit the market in Puupanini.

Ossipoff Puupanini Living Room

Ossipoff home (MLS # 201930963) in Puupanini

Built in 1954, this special home was designed for Marshall Goodsill a prominent local attorney and partner of Goodsill Anderson Quinn and Stifel*. It has been featured in "Hawaiian Modern" a book by Dean Sakamoto that featured the works of Ossipoff. What's remarkable about this home is the character of the era is still well kept. By being an official historic home on the historic registry, the annual tax bill is only $300/year.

Historic Ossipoff Residence in Puupanini

Historic Registry Designation

Indoor/Outdoor Living Area

Ossipoff Puupanini Living 1

Ossipoff Puupanini Living 2Ossipoff Puupanini Living 3

This home feature's Ossipoff's signature indoor/outdoor living with walls that open up for natural ventilation.

White Washed Wooden Walls

Ossipoff Paneling in Puupanini Home 1Ossipoff Paneling in Puupanini Home 2

It also featured the white washed wood that was seen in a lot of mid century Ossipoff homes of the era.

Outdoor Lanai

Ossipoff Covered Lanai 1Ossipoff Covered Lanai 2

Outside of the famous Liljestrand house, this covered lanai was one of the main features I remember from the Ossipoff Exhibit I attended and wrote about back in 2008.

Mid Century Modern Homes on Oahu

To learn more about this or other mid century modern homes on Oahu, feel free to contact me for more information.

*The Stifel residence was also in Puupanini, designed by Ossipoff and sold in 2017 ago for $8,250,000

Nov. 7, 2019

Honolulu's Bill 7 Features and Incentives

Honolulu Hale Bill 7

Here are some of the features and incentives provided by Bill 7 

  • The building is not required to provide parking spaces according to a mandated ratio. This allows the developer to determine the optimum number of parking spaces that will yield the most apartments, given the demand in the market for parking stalls. Buildings near transit stations may offer fewer parking spaces than buildings without easy access to mass transit.
  • Building permit review will be expedited. The intent is to approve permit applications within 90 days through “check-the-box” permitting rather than discretionary permitting.
  • Fire safety is integrated into each building using cost saving strategies. Fire sprinklers can use domestic water lines as designed by a licensed mechanical engineer rather than dedicated fire sprinkler lines. Buildings that have fewer than 36 units can have one 45” staircase or two 36” staircases. Elevators are not required.

In addition to design allowances, there are financial incentives available to qualifying projects.

Park dedication requirements are waived, and wastewater system facility charges are waived (the capacity must be available). Plan review and building permit fees may be waived . The property may qualify for exemption from real property taxes during construction and marketing lease-up period for apartments that are to be rented to tenants who earn no more than 100% of the area median income at rents that are no more than area median rents. Exemption from real property tax can extend to 10 years for apartments that are rented to tenants who earn no more than 80% of the area median income at rents that are no more than 80% of area median rents.

Up to 20% of the apartments can be occupied by the owner or members of the owner’s family. The remaining units must be rented for no more than 100%of the area median rent to tenants who earn no more than 100% of area median income.

2019 HUD AMI (Area Median Income) for households in Honolulu

1 person $84.000
2 people $96,400
3 people $108,500
4 people $120,500 

2019 HUD maximum rents in Honolulu for 100% AMI households

Studio $2,260

One bedroom $2,411

Two bedroom $2,848 

Three bedroom $3,243 

Four bedroom $3,646

Not including utilities

For more information on Bill 7, contact:

Dianne Willoughby, Realtor 

808-347-9945

DWilloughby@HarcourtsHi.com

Oct. 31, 2019

Happy Halloween from Harcourts and Old Captain America

Aloha! This is old Captain America here. I just got back from time traveling and I heard my buddy Wolverine studied some properties here in Hawaii a few years back and I figured I'd go back in time to look at some cool looking properties.

The "Old" Captain America presenting some great properties on Oahu

Untouched: Vacant Land on the North Shore

North Shore Vacant Land

2 Acres on the North Shore (MLS # 201913619) for $2 million

This oceanfront two acres of land on the north shore of Oahu is undeveloped and can be purchased for only $2 million.

1945: Palolo Home

Palolo Home Built in 1945

Palolo home (MLS # 201929505

This is in a valley right up the road from us here on Kapahulu in Palolo. It's a 6 bed, 2 bath home built in 1945 (remodeled in 2017) is listed for $1,150,000.

1963: Punchbowl Studio Condo

Punchbowl Studio condo built in 1963

Punchbowl Studio (MLS # 201923006)

This condo was built in the 1960's in Punchbowl near where my buddies were buried. This is a great location near downtown Honolulu built in 1963 and remodeled in 2014.

1967: Punchbowl 2 Bed Condo

Punchbowl 2 Bed Condo Built in 1967

Punchbowl 2 Bed Condo (MLS # 201915065)

Next, we jump later into the 1960's around the crater in Punchbowl to Sky Tower. It's a 2 bed, 2 bath unit on the ground floor listed at $478,000 (remodeled in 2016).

1970: Kapiolani Manor Condo

Kapiolani Manor Condo Built in 1970

Kapiolani Manor 1 Bed Condo (MLS # 201926812)

Then we come to Kapiolani Manor right near Ala Moana shopping center. This is a 1 bed, 1 bath for $330,000 and overlooks the Hawaii Converntion Center and you've got views of Waikiki and the ocean in the background.

1970: Makaha Valley Towers Condo

Makaha Valley Towers Condo Built in 1970

Makaha Valley Towers 1 Bed Condo (MLS # 201905697)

In the same year of 1970, Chin Ho developed Makaha Valley Towers and this is a beautiful unit that was remodeled in 2016 and is available for $220,000.

1974: Beachside Kailua Home

Beachside Kailua Home

Kailua Home (MLS #201927474)

Also in the 1970's, this looks like the year the Harcourts Broker may have been born. This is a beautiful home built in 1974 and completely remodeled in 2012 and is listed for $3,300,000.

1979: Waikiki Sunset Condo

Waikiki Sunset Condo Built in 1979

Waikiki Sunset Condo (MLS # 201921379)

The Waikiki Sunset is a great building right down the road from the Harcourts office on Kapahulu. This is a 2 bed, 1 bath for $440,000 Leasehold.

1988: Diamond Head Home

Diamond Head Home built in 1988

Diamond Head Home (MLS # 201925976)

In 1988, this beauty was built 31 years ago. It was remodeled in 2008 with a high end kitchen and on the slopes of Diamond Head currently priced at $5,380,000.

1992: Kaneohe Home

Kaneohe Home built in 1992

Kaneohe Home (MLS # 201927477)

In 1992, I'm not sure if you remember that year, however it was a fun year! We've got a 3 bed, 2.5 bath home with gorgeous views of Kaneohe Bay. This one is listed for $1,450,000

2016: Symphony Penthouse Condo

Symphony Honolulu Penthouse Built in 2016

Symphony Penthouse (MLS # 201911230)

Last, but not least we have the newest of all the inventory I've been scouting out. This is a relatively new building built in 2016 at the Symphony and this is where we're doing our Harcourts Auctions with a starting bid price of $1,200,000.

Happy Halloween

To learn more about all these cool properties, give "The Cap" a call :) Aloha!