In November I questioned whether we would see “normal” seasonality slowing the Oahu real estate market as local buyers and sellers focused on the holidays. Throughout 2020 economists had predicted that the pandemic related pause along with the start of an economic recovery and pent up demand in the low interest rate environment would extend the busy summer season into fall and winter on Oahu.
Both December and January have proven to be very strong months for the Oahu housing market as we’ve seen some record and near record levels of various market indicators. Will the Oahu market remain strong heading into 2021?
HONOLULU BOARD OF REALTORS EXECUTIVE SUMMARY
The O‘ahu housing market continued to gain positive momentum into the new year with closed sales of single-family homes and condos increasing 9.8% and 3.4%, respectively over last year. The median sales price for single-family homes set a new record of $883,000, marking a 14.7% increase year-over-year and 1.5% more than last month. Compared to the previous year, the condo median sales price increased 5.4% to $452,000, which is a slight decrease of 0.7% from $455,000 recorded last month.
Steep competition continued to drive the market’s pace, with single-family homes spending a mere median of nine days on the market before entering into a contract. This speedy pace ties with the record low nine days on the market set in September 2020. In addition to quick transactions, sellers received more than their asking price in 54.6% of all single-family home sales in January. Condos spent more time on the market than single-family homes, with a median of 18 days on the market, but this rate is 45.5% faster than the median days on the market last year. Meanwhile, nearly 30% of condo sales closed above the original asking price, which is more than triple the amount compared to last January.
While single-family homes in the $600,000 to $999,999 range accounted for 56.4% of closed sales last month, most sales increases were generally in the upper price ranges. Homes sold at $800,000 to $999,999 increased by 61.5%, and properties sold in the $1 million and up range hiked up 64.1%. In the condo market, properties in the $500,000 to $699,999 price range saw the largest increase in closed sales, up 35.3%.
Typically, new property listings see a bump in the new year; however, new listings were down for both single-family homes and condos at 14.7% and 5.3%, respectively. There are 790 active listings for single-family homes and 1,992 active listings for condos available on O‘ahu.
The fundamentals of the Oahu housing market remain strong. Pent-up demand and low interest rates are increasing the demand side of the market. Inventory is low, but usually starts to pick up this time of year. Really strong pending sales numbers from December and January point to a strong start for 2021.
If inventory does not increase as we typically see this time of year, overall volume of our market will be impacted and prices will continue to climb even higher. This is a really great time to be listing a property, especially those properties that may have minor issues buyers would prefer to avoid in a more balanced market.
There are still a couple areas of concern that could have a negative impact on the Oahu housing market in 2021. The new more contagious strain of Covid has been identified on the US mainland and here in Hawaii. This could cause positive Covid case numbers to spike, leading to a return of restrictions on normal market activities. The moratorium on evictions and mortgages is still an unknown that could also have a negative impact on the Oahu housing market in 2021.
To see the full report, click HERE. As always, a reminder that statistics vary by neighborhood, building, and price band. If you have questions about your home, building, or neighborhood, please fee free to CONTACT ME. If you would like to receive free quarterly Oahu market reports or periodic region or neighborhood/building reports delivered to your inbox, click HERE.