To view the current listings Click here .

For the discriminating buyer, the possibility exists that we have now entered the best market to purchase Exclusive properties in Hawaii in years. I've created a link to a website located at the top of this article to view these properties, but thought I'd also spend some time on why I believe the market may be perfectly positioned to acquire these properties now.

As we sit today in the $5MM plus market, there are currently 38 properties available. In the past 6 months, there have been a grand total of 4 sales in this price range in the criteria that I am analyzing which is waterfront properties. The last 2 of these sales were recorded in March of 2009 with the 2 other properties having closed in December and January. In other words, up to 38 homeowners have been waiting over 3 months for someone to purchase their property and no one has come forward.

At the past 6 month activity level, it would take 5 years to deplete the current supply of listings and at the past 3 month level (zero), it is what one could aptly describe as a market that could be within the complete control of a capable buyer. To put this into a historical perspective :

2008 totals         14 closed sales    17 active listings at year end (38 June '09)
2007 totals          9  closed sales         
2006 totals         12 closed sales
2005 totals          8  closed sales
2004 totals          9  closed sales

As you can tell from the numbers above, while 8 to 14 sales in this price range and category are the historical range per year, with no sales and no pending sales currently identified on the MLS for the past 3 months, what a great climate to present an offer to a seller that is cash and priced according to the current market conditions.

The search link below is to provide you with an idea of what is currently available. If you would be more interested in having a personalized search prepared for you or would like more information on my market feel free to contact me by email or give me a call at 808-225-3660.

I have made the business decision to only represent purchasers in this price range of homes which allows me to fully represent the purchaser's interests, aid in negotiating strategies and aggressively seek the best terms available for my client, the purchaser. To further avoid potential conflicts with my existing client's interests, before I am able to accept additional clients in this price range, I seek approval from my existing clients.

Let's get started!



Michael Hege' RA
Kapolei Realty, Inc
808-225-3660
mhhege@aol.com

Update May 31st - Sale postponed to July 25th - Details

For those of you paying attention to the calendar, what seemed liked the distant future in January is quickly coming. The best guess is that there are currently 130 +/- reservations in place for the remaining 120 units. Conventional wisdom is that there will be enough fall out from those parties with reservations that there will still be available units with the current count of reservations.



                

What is unknown is that assuming the Developer's intention to sell all the units is still soundly in place, what the developer will be willing to do to achieve that goal. More than ever, I think it is important to place yourself in the position to have the opportunity to say yes or no. I am not convinced that as we speak now, we know the final terms and incentives that will be placed on the units and we certainly don't know what the ultimate prices will be.

Everything I've heard is that the bulk of the interest is in the lower priced units and I think that a reservation placed in the near future will still have an excellent chance of being able to purchase some of the nicest units in the buildings. Depending on how they set the ultimate prices, there may be opportunities to purchase Ocean Front luxury fully furnished condominiums for as little as $1.625 MM which were selling for $2.8 as recently as 6 months ago.

If you would like to look at some pictures of these units, here is a link to several on Flickr Beach Villas on Flickr .

There is a lot to talk about regarding the sale event and time is drawing to a close, so I would love to hear from you if you would like to spend some time on the phone to hear about them. If at the end of the conversation, if you are still interested, we can take if from there. To quote Woody Allen, "90% of life is showing up".

There are also some great rates available during the event at the Beach Villas themselves and at the JW Marriott Ihilani Hotel. Both are having rates under $200/night plus tax, although the Villa rates are based on a minimum 7 night stay. Still, I think that may be the least expensive rate I have ever heard of at the Villas and apparently includes their entire inventory of units which would mean to me that you should be able to get a unit that is great for you or your family.

This sale is a product of the current housing environment and could be looked back on as a "What was I thinking? " when the opportunity passes and the results are in. Lenders are in place with sharpened pencils and if nothing else, it will be a fascinating event to participate in on June 6th and 7th.

For earlier articles on the Beach Villas by myself, follow these links: 


Introduction to the Beach Villas at Ko Olina

Announcement of the Final Sale event in February

March Final event update

If you want me to mail you more information, you can reach me at Contact Michael



                   

Aloha

In almost any conversation I have with people who are interested in Real Estate, the question always comes up as to whether we are at the bottom of, nearing the end of or expecting to continue the current declining market. It is a question that I don't know the answer to. The data that I read seems to indicate that in our local market,  we are closer to the end of the downturn than the beginning, but I think it would be premature to say that we are in the rebound stage.

Hawaii in general and Oahu in particular seems to have been uniquely positioned to better weather the financial storm that descended into the real estate market over the past few years. Factors benefiting Oahu seem to be the combination of employment, supply versus demand of housing and a lower than average number of subprime mortgages. That said, in the latest analysis of subprime mortgages in Hawaii we see that 10.87% of the mortgages in Hawaii were subprime mortgages as compared to other state averages from 16% (Florida and California) to 4-5% in states like North Dakota, Montana and South Dakota. So, that sounds promising.

Unfortunately, of those subprime mortgages in Hawaii, 19.22% of them are seriously delinquent as of the 4th quarter 2008. As a state, Hawaii falls into the middle of the pack with the highs in states like Florida at 36,4%, Nevada at 31.4%, California at 28.9% and Arizona at 27.3%. Those are the top for states with "serious delinquencies", and while we are way below Florida, we are not nearly as far below Arizona for instance as I would like to be. With 20% of 10.87% of the subprime mortgages heading toward foreclosure, that would carry through to 2.2 % of the entire mortgage market in Hawaii. Add to that the simple fact that VA, FHA and  Conventional mortgages are not immune to foreclosure and that translates to a continuing large portion of the marketplace being made up of distressed sales which traditionally places downward pressure on prices.

For a great nationwide analysis of the Real Estate market follow this link to The PMI research site and you can view one of the best collections available of the downside market and risk.

As to Oahu, my favorite subject, April had continuing declines in the Median Price range and in the number of closed sales in both the single family and condominium categories as compared to April 08: 

Single Family                  Median Price   -8%     Units sold -32%

Condo/Townhouses          Median Price  -7.3%   Units sold -42%


As always, these numbers reflect the closed transactions. What I am hearing and seeing in my travels of showings, conversations with agents and experiencing on my own listings is that Buyers have reappeared and there is much more activity than there was a few months ago. Multiple offers on well priced listings, lower "Days on Market" and higher numbers of "Active Continue to Show's" on the MLS listings seem to confirm that demand is coming back into the market and is more robust than it has been for a while.

My favorite stat that the Board of Realtors provides is the "months of inventory remaining". Simply put, how many properties are listed divided by how many sold equals how many months it would take to deplete the existing inventory. While it is a number that is not of much valuable as a stand alone number, it is a great number to compare different months or years to. Since December '08, here are the numbers:

Month            Months of Inventory          Months of Inventory
                      Single Family                 Condo/Townhouses
December 08      12.0                                  13.1
January 09           9.8                                  10.3
February 09        15.8                                  15.8
March 09            14.7                                  16.1
April 09               9.7                                  10.1

April had a very significant drop. These numbers reflect the relationship between the number of active listings in a given month and the number of closings for that given month. The lower the number, the higher the odds are that a listed home will sell in a given month. A Hot seller's market has numbers like 1 and 2 which we saw in 2004 and 2005. A pure buyer's market has numbers of over 20 months like we saw in 1995 to 1998. Most of 2008 was in the 7's and 8's. During that time, with approximately 6,670 closings and 14,700 listings (single family and condos combined) the odds of selling your home if you listed it were 44%. It will be interesting to see how 2009's odds begin to develop.

The Oahu market had not crossed 10 months until the fall of 2008. The last time the inventory had been in the 10 month area had been the spring of 1999. How long we stay in the 10 month area, whether we trend higher or lower over the next several months will all begin to tell the story of that original question... "Where is the market going".

The short answer is this. There are a lot of properties on the market that are currently priced below the current market value. There are a lot of properties that are currently priced at market value and there are even some that are probably priced above market value. I am a believer that this is not the best time to pay retail for a house. Determine the type of home you are looking for and watch the available listings until a well priced distress sale property becomes avaliable that meets your needs and be ready to make your offer. That would include having a preapproval in hand, being familiar with the current and past sales of the area you are looking at and being mentally prepared to act if what you are looking for becomes available. If you are able to purchase a property for 10 to 15% below market, you have the advantage of taking advantage of todays interest rates and having some cushion in the event the market continues to adjust. The question isn't really "Is this a good time to buy?" I believe the question continues to be "Is this a good house to buy at this price?"

If you would like to have me make a website that would allow you to begin to watch a particular market, let me know at this link: Make me a website

For the full Honolulu Board of REALTORs April 2009 statistical analysis which was the source of some of this data, Click Here

As always, if you would like to contact me, I may be reached at Contact Michael

Aloha

                                   James Allen

Aloha!

Now that the shouting is over and the new Stimulus law has been passed, I think many of us are wondering what it all means. As REALTORs I think it's very likely that we will receive many benefits from legislation that is at least partially concerned with improving the housing market.

Just being knowledgeable and knowing where to send our friends and clients to look is often the best approach. Real estate 101 tells us that we are not tax experts and we always give the caveat to not rely on us for tax advice, but it's always nice to have a source for them to go to for their own information.

Below, you will find a link that I think is a good source of those basic parts of the Stimulus plan. There are a lot of moving parts in this program and I think one for us to be sure to mention is the First Time Home Buyer program.

The first-time Home buyer credit for eligible buyers is a tax credit equal to up 10 percent of the purchase price but it can not exceed $8,000. The time frame of the purchase needs to have occurred between January 1st, 2009 and December 1st, 2009. I can already see the closings that have to get closed right after Thanksgiving or the client loses an $8,000 tax credit!

This should not be confused with last years which required repayment over 15 years. This one doesn't require repayment and that's a big change. One must give and take though. This one does phase out for individuals with incomes over $75,000 or for married couples with incomes of over $150,000 who file their taxes jointly. There is also a forfeiture of the credit if you sell the house within 3 years.

For a good comparison between the 2008 tax credit and the new one, CLICK HERE

Now, as I write this, I realize that I get to call a client of mine who is awaiting a closing date and tell him that I think he may be entitled to an $8,000 tax credit without repayment. I will of course tell him to check with his tax consultant, but I can certainly put him on the trail. These are the types of things that give me sheer joy in the business. Mortgage Tax Credits, tax credits, tax deferred exchanges... I love being able to make people aware of savings that they might not have been aware of. It is one of my favorite definitions of value added services.

Here's the link to the New York Times article, What's in the Stimulus Bill for you?

I hope you get to make some "good news" calls!

Did I mention that I am not a tax consultant, I do not play one on TV and you should not rely on any of the above as any form of tax advice and should of course seek the assistance of a tax professional!