Oahu home resales up 13 percent
| • | Chart: O'ahu home resales for October |
By David Butts
Advertiser Staff Writer
O'ahu home and condominium resales rose nearly 13 percent in October from a year earlier, making real estate one of the few bright spots in an economy slowed by a dramatic drop in tourism since the Sept. 11 terrorist attacks.
"We haven't seen a significant negative impact from Sept. 11," said Norman Noguchi, president of Marcus & Associates Inc., a real estate company. "Real estate tends to feel it a little after everything else. We are monitoring how it will be in the next few months."
A combination of low interest rates and pent-up demand for homes, contributed to a quick rebound in sales after a drop in September.
The Honolulu Board of Realtors said 306 existing single-family homes and 382 condominiums were sold in October, up 12.5 percent and 12.7 percent from the last October. In September, single-family home sales were down 11.8 percent on the year and condominium sales were off 3.5 percent.
"Home sales are back on track," said Peter Freeman, the board's president and chief executive officer, who blamed the September drop in part on fallout from the terrorist attacks. The question for Hawai'i's real estate agents is how long can tourism continue to suffer before the effect spills over into the housing industry.
Tourist arrivals are down about 20 percent since Sept. 11, and layoffs are rippling through many businesses. Airline, hotel and retail employees make up a large part of the real estate client base, and several economists have said the state is already in recession.
"We are a product of the tourist industry," Noguchi said.
Still many home buyers have been encouraged to act now because of low mortgage rates. The average 30-year mortgage in Hawai'i cost a borrower 6.30 percent last week.
Interest rates may be headed even lower. Analysts expect Federal Reserve policy makers to reduce the benchmark U.S. interest-rate to 2 percent today, lowest since the Kennedy administration.
The average home price rose in October. Single-family homes sold for a median price of $325,000 in October, up 5.5 percent from $308,000 in September.
The only declining number was for condominium prices. The median condominium price was $125,000 last month, down 6.7 percent from $134,000 the month before.
The Board of Realtors report includes only transactions that have closed, and there is a two to four month delay between a sales contract being signed and closing the sale.
