O'ahu's housing market continued to display its stamina last month, with slight increases in median sale prices of existing homes as many Mainland markets are tanking.

There even was a gain in the number of single-family home purchases in August, though observers said a one-month pickup in sales doesn't suggest a turnaround of what has been a two-year trend of declining transactions.

"The O'ahu housing market has remained relatively stable," said Berton Hamamoto, president of Property Profiles Inc. and the Honolulu Board of Realtors.

Some housing market watchers predict a drain on sales and perhaps prices from the recent implosion of the subprime lending industry, but others disagree, and the effect, if any, isn't expected to be reflected in sales data for another month or two.

For August, O'ahu single-family homes sold for a median $650,000, up 2.4 percent from $635,000 a year earlier and up 1.6 percent from $640,000 in July, according to Board of Realtors data.

The slight gains helped put the median for the first eight months of this year at $647,300, or 1.9 percent higher than the $635,000 median for the same period last year.

Condominiums sold last month for a median $325,000, up 6.6 percent from $305,000 a year earlier, but down 3 percent from $335,000 in July.

For the first eight months of this year, the median condo price is $325,000, up 4.8 percent from $310,000 during a year earlier.

"We're looking at a relatively flat market," said Leroy Laney, professor of economics and finance at Hawai'i Pacific University. "I think you will see a plateau that could go out for several years."

Laney said he expects there could be months or even years with mild price declines or appreciation ahead, but he doesn't forecast any big price drops.

Bob Ristelhueber, a 52-year-old freelance writer who moved to O'ahu after selling his home on the Big Island in February, believes prices are headed lower.

Ristelhueber said he checked out a few condo open houses last month, but since then none of the units he saw has sold, and the price was reduced for one. So his plan is to hold off on buying anything until next year.

"Hawai'i has a lot going for it, but no market is insulated from the housing downturn that's taken hold across the U.S.," he said. "Demand is anything but strong. Prices are going down."

For condos, year-to-date median prices for 19 regions were up in 13, down in four (Hawai'i Kai, Wahiawa, 'Ewa Plain and Maka-kilo) and about flat in two (Mililani and Waipahu).

Chason Ishii, president of Coldwell Banker Pacific Properties, believes that Hawai'i's growing economy with its ultra-low unemployment and rising personal income will sustain an overall stable real estate market.

"With all the fundamental economic indicators that are occurring, it looks like the O'ahu housing market continues to be extremely strong," he said.

Condo sales in August fell 14.7 percent to 495 from 580 a year earlier. Year-to-date condo sales are down 14.5 percent to 3,930, from a year earlier. Condo sales are in their second year of decline.

Inventory of homes on the market generally has been rising a little from month to month over the last several months. But for the last three months, inventory was lower compared with the same month a year earlier, which halted a trend for higher year-over-year inventory levels that had persisted since late 2005 when sales peaked.

There were 1,859 single-family homes on the market last month, down from 1,937 a year earlier and a nine-year high of 2,052 in November.

There were 2,386 condos on the market in August, down from 2,707 a year ago and below a nine-year high of 2,750 in September.

Single-family homes sold in August spent a median 44 days on the market before selling, up from 37 in July, but down from a recent high of 70 in February.

Condos spent a median 38 days on the market before selling last month, up from 35 in July, but down from a recent high of 59 in February.

Harvey Shapiro, research economist for the Board of Realtors, said the housing market in the next few months could be helped out if the Federal Reserve cuts interest rates later this month. Shapiro said mortgage rates in the last month have declined, which should help keep demand relatively strong.

However, there remains much uncertainty about how much of a drain on sales, if any, there will be from the recent drastic cutbacks in subprime lending, an industry that helped fuel demand for homes over the last several years.

The impact from fewer subprime loans wouldn't be reflected in home sale data until next month at the earliest because it typically takes one to three months for pending sales to close. So lending changes made in August may not start to be reflected until September sales are reported in October.

Reach Andrew Gomes at agomes@honoluluadvertiser.com.