NAR Reports Dropping National Sales Figures. What does this mean to the Hawaii Market?

Mon, Jul 28, 2008

According to an Associated Press Article Dated July 24, 2008, the National Association of Realtors is reporting a 2.6% drop in home sales, and a 6.1% June-to-June drop in median home price.

According to the article, analysts claim that this slump will not end until inventory (amount of homes for sale) declines. Unfortunately for many mainlanders, foreclosures are pushing more homes onto already flooded markets, keeping inventories high and extending the market’s recovery time.

If this is a good synopsis of our Real Estate problems, Hawaii has two reasons to be optimistic:

First, Hawaii’s conservative construction practices have spared us the inventory disasters that trounced Mainland cities like Las Vegas, where overdevelopment of new homes flooded the market, driving prices down. We didn’t overdevelop to that extent, so our inventory problem is not nearly as bad.

Second, conservative lending practices in Hawaii has spared us a dramatic foreclosure crisis. Hawaii lenders were more careful with “exotic” subprime mortgages than many of their mainland counterparts. The result- Only 1 out of 3676 homes in Hawaii are in foreclosure while 1 out of 501 US homes are in foreclosure. We aren’t experiencing a devistating surge in foreclosures that threatens to flood the market with inventory.

forclosures, hawaii real estate, home prices, home sales, nar

This post was written by:

Kawika - who has written 16 posts on Hawaii Real Estate Reporter.

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1 Comments For This Post

Mike Says:
July 29th, 2008 at 9:40 pm

A little bit of comparison to our Hawaii market does so much to put these national articles into perspective….
The article talks about slowing sales resulting in increased inventory, and that the increased remaining inventory is a big factor that is slowing overall market recovery…”(remaining inventory) represented a 11.1 month supply at the June sales pace, the second highest level in the past 24 years.”
The most recent HBR stats point out that as of June 2008, Oahu’s market has 8.3 months of remaining single family inventory and only 7.0 months of remaining condo inventory–that means our remaining condo inventory is 37% less than the national average….!
When you consider that 6 months of remaining inventory is considered the hinging point between a buyers market and a sellers market, it becomes pretty clear that the Hawaii real estate market is pretty healthy, and is in noticeably better shape than the nation as a whole.

Mike Says:
July 29th, 2008 at 9:40 pm
A little bit of comparison to our Hawaii market does so much to put these national articles into perspective….
The article talks about slowing sales resulting in increased inventory, and that the increased remaining inventory is a big factor that is slowing overall market recovery…”(remaining inventory) represented a 11.1 month supply at the June sales pace, the second highest level in the past 24 years.”
The most recent HBR stats point out that as of June 2008, Oahu’s market has 8.3 months of remaining single family inventory and only 7.0 months of remaining condo inventory–that means our remaining condo inventory is 37% less than the national average….!
When you consider that 6 months of remaining inventory is considered the hinging point between a buyers market and a sellers market, it becomes pretty clear that the Hawaii real estate market is pretty healthy, and is in noticeably better shape than the nation as a whole.

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