The median price of previously owned single-family homes on O'ahu was down in March, extending the broad weakness in residential property values that began in late 2007, though the decline was smaller than it was in the first two months of the year.

Single-family homes sold for a median $600,000 last month, down 4.5 percent from $628,000 in the same month last year, according to the Honolulu Board of Realtors.

In January and February, the declines were 10.1 percent and 8.2 percent, respectively, compared with the same months a year before.

While this might suggest a trend of smaller declines, Harvey Shapiro, research economist for the trade association that compiles the sales data, said there are too few sales to make a sturdy assessment on whether prices are nearing a bottom.

Negative economic pressures suggest the bottom hasn't been reached, and local economists project home sales will weaken moderately for two years.

There was one definite bright spot in the March data: homes sold significantly faster last month.

It took a median 48 days for single-family homes to sell after they were listed. That was just one more day than in March 2008, but down from about 70 days in the previous two months. The time hadn't been below 50 days since August.

Faster sales helped reduce inventory a bit, which is another positive factor for the market. There were 1,901 single-family homes listed for sale last month, down from 1,919 a year earlier and 1,928 in February. In January, inventory was at 1,903.

A relatively stable inventory is one reason real estate industry experts say prices have remained fairly stable, avoiding plunges of more than 30 percent that have occurred in some Mainland markets flooded with unsold homes.

O'ahu's single-family home inventory rose in 2006 to around 2,000 homes from around 1,000 in the preceding few years when demand was red hot, but is still below levels for most of the 1990s.

These bright spots of inventory and sales pace, however, are still being overshadowed by the state's weakening economy in which job losses continue to pile up.

"The total number of jobs relates to demand in the housing market," Shapiro said. "As jobs continue to contract, there won't be any real strength in the housing market."

TOUGHER STANDARDS

Another dampening effect has been stiffer lending standards to qualify borrowers for a mortgage, which is limiting the number of people who can take advantage of historically low interest rates.

The result was fewer home sales last month. Just 188 single-family homes sold in March, down 33.3 percent from 282 a year earlier.

The number of sales last month was higher than in January or February, but sales have been that way for at least a decade because of seasonal factors.

"Compared to last year ... the market is still very weak and we expect these slower conditions to continue until there is better economic news in Hawai'i," said Sandra "Sam" Bangerter, president of the Honolulu Board of Realtors and co-owner and principal broker of RE/MAX Kai Lani in Kailua.

Chason Ishii, president of Coldwell Banker Pacific Properties, said he believes lower prices and what he perceives as improving consumer confidence is moving more prospective home buyers off the sidelines.

"There's a lot of pent-up demand from people sitting on the sidelines," he said. "They are starting to see more value out there."

Ishii said the number of sales pending last month was only 14 percent or 15 percent below a year earlier, suggesting that the decline in sales may start to soften in the next few months.

Sales counted by the Honolulu Board of Realtors are purchases completed in March, which typically reflect sales contracts signed one to three months earlier.

For the first three months this year, the number of sales has been down between 21 percent and 47 percent compared with the same months last year.

MORE DECLINES

If demand stabilizes or begins to increase, it would help put a floor under prices, which only began to weaken in late 2007 and declined 3 percent last year.

However, factoring in a broad outlook for the local economy, the University of Hawai'i Economic Research Organization doesn't foresee a stop to declines through 2011 for the median price, which is a point where half the sales are higher and half are lower.

UHERO last month forecast that median single-family home prices on O'ahu will fall 9 percent this year and 4.9 percent next year. The research group expects a 0.6 percent reduction in 2011.

For the first three months of this year, the single-family home median price is down 8.1 percent to $570,000.

In O'ahu's condominium market, UHERO projects the median price will decline 8.5 percent this year, 10.4 percent next year and 7.2 percent in 2011.

The median condo price was unchanged last year at $325,000. Last month, condos sold for a median $305,000, down 7.4 percent from $329,300 in the same month last year.

For the first three months of the year, the median condo price is down 9.1 percent to $300,000 compared with the same period last year.

There were 248 condo sales in March, down 36.7 percent from 392 a year earlier.

The pace of condo sales was quicker last month, in line with the uptick in the single-family home market. Condos spent a median 47 days on the market, which was still higher than 39 days a year earlier but down from 70 days in February and 59 days in January. The time hadn't been below 50 days since August.

Condo inventory was at 2,582 units last month, which was just one more than 2,581 a year earlier but up from 2,507 in February and 2,494 in January. Inventory had been around 1,000 a few years ago, but has been over 4,500 during the 1980s and 1990s.