O’ahu Market Report – June 2024
In June 2024, home sales rose by 4%, while condominium sales plummeted by 47.5%. Despite this, the median price remained strong, with homes increasing by 3.2% to $1,120,000 and condominiums by 3.9% to $530,000. The sharp decline in condo sales is likely due to recent hikes in maintenance fees, driven by soaring insurance rates. This year has seen significant increases in hurricane insurance premiums for condos, leading to buyer resistance against higher maintenance costs. The elevated maintenance fees may push buyers to purchase single-family homes. Buyers prefer to pay monies towards a mortgage payment rather than maintenance fees. Until the insurance issue is resolved, the disparity between condo supply and demand may continue, exerting downward pressure on prices.
Approximately 70% of homeowners nationwide have mortgages with interest rates at 4% or lower, making it less appealing to sell their homes and purchase new ones at higher prices. This has resulted in an inventory crunch for homes on Oahu and in many areas across the country. Sellers benefit from this low inventory, experiencing stable prices, less negotiation, and quick sales (a median of 15 days on the market in June).
If you are considering buying a home, be prepared to compete with other buyers, make decisive offers, and bid at or near the listed price. Conversely, if you are looking to buy a condominium or townhome, you are less likely to face competition, allowing for more negotiation strategies and a broader selection of properties.
