Posted on: Tuesday, October 5, 2004

O'ahu home sales down

By Andrew Gomes
Advertiser Staff Writer

O'ahu's sizzling real-estate market cooled a touch in September, as sales of previously owned single-family homes and condominiums fell slightly while prices remained at or near record levels.

It was the second month in a row for year-over-year declines in single-family home resale volume. Sales totaled 410 last month, down 2.1 percent from 419 a year earlier. The median price was $475,000, off the June high of $481,800.

Condo resales also dipped — a first for 2004 — though the difference was only 701 sales vs. 703, or 0.3 percent lower for the same period. The median price of $219,000 was a record, eclipsing $217,000 in July.

Brokers said the small sales falloff, reported in data released by the Honolulu Board of Realtors yesterday, could be the initial stages of a broader market slowdown. But prices appeared unaffected and competition for well-priced homes in attractive locations remains fierce.

"We were getting pretty disappointed," said Mark Mercado, a carpenter who had been looking to buy a fixer-upper house on the North Shore with his wife since January. "If we waited for (homes) to get listed, they were sold already. It was getting crazy."

In August, Mercado finally closed on a Waialua property with a three-bedroom, one-bath house and a two-bedroom, one-bath cottage.

Mercado, who acted fast to meet the seller's $425,000 asking price, said three back-up offers came in ranging from $10,000 to $50,000 above the asking price. "We figured we made $50,000 just by moving in," he said.

The Honolulu Board of Realtors said 22 percent of single-family homes and 13 percent of condos sold for more than the asking price in September.

The homes sold for a premium have fallen since this summer, which is another indicator of a cooling market and possibly more available inventory. Still, the premium level is higher than last year and shows that demand remains strong.

"I haven't seen much of a slowdown," said Jerry Frederick of Century 21 Aloha Properties. "There's still quite a few (buyers) out there and not enough inventory."

Herb Conley, managing director of Coldwell Banker Pacific Properties, said the slight drop in sales isn't surprising given double-digit increases during the previous two years.

"We would expect some easing in the percentage increases," he said, noting that the number of single-family homes sold last month was higher than any month during the Japanese bubble economy. For condos, September volume was higher in only one month during the Japanese bubble, he said. "You're still at a very, very strong pace."

Demand has tended to keep prices high, though the median prices, the midpoint where half the sales are for more and half for less, recently have fluctuated from month to month depending on which neighborhoods have fewer or more home sales.

September's median price hit a new record for condos, at $219,000. That compared with $180,000 a year earlier, and $207,800 in August. The previous high was $217,000 in July.

For single-family homes, September's $475,000 median was up from $395,000 a year earlier, and up from $450,000 in August. The previous high was $481,800 in June.

For the first nine months of the year, there were 3,468 single-family home sales, up 5.3 percent compared with the same period last year, and 5,894 condo sales, up 15.6 percent.

On a dollar-volume basis, sales this year through September totaled $3.44 billion, up 34.2 percent from $2.56 billion in the year-earlier period.

Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.