Oahu homebuyers snapped up properties at a relatively quick pace in June as the housing market cooled from a year ago amid a dip in prices.
Most single-family homes and condominiums remained on the market for just over two weeks, slightly longer than the week and a half they were on the market a year ago.
The median price for single-family home resales stabilized in June but remained above seven figures at $1,050,000. That was down 4.5% from $1.1 million a year ago and off 5.3% from $1,109,000 in May, according to data released Thursday from the Honolulu Board of Realtors. The median, which means half the prices were above and half below the given price, topped $1 million for the second straight month and for the third time this year.
Condo prices declined 4.5% to $510,000 from $534,000 a year ago but inched up 1% from $505,000 in May.
“The directional shift in several market indicators — the modest pullback in median sales price, the slightly longer days on market and the dip in the percent of original list price received — affirm the transition from last year’s intense buyer competition to a moderating environment in some areas,” Honolulu Board of Realtors President Fran Villarmia-Kahawai said in a statement. “Market headwinds that persist are low inventory and shifting affordability as average mortgage rates remain elevated from recent years.”
Sales of single-family homes plunged 30.5 % in June to 248 from 357 a year ago, while condo sales dropped 24.9% to 470 from 626. Still, sales for the second quarter gained momentum from the first quarter as they jumped 28.4% and 27.2%, respectively.
High mortgage rates have cut into both inventory and sales.
“It’s definitely affecting the market,” said Realtor Chris Zhu of Coldwell Banker Realty of Hawaii. “It reduces the buyer’s purchasing power. The higher interest rate lowers the loan amount they can get. The less they can borrow, the less they can afford. It will drive the prices down.”
Higher rates also mean there are fewer properties on the market because homeowners are reluctant to move if their rate for a new property is going to be much higher than their existing rate.
The average rate on a 30-year home loan rose to 6.81% this week from 6.71% last week, according to mortgage buyer Freddie Mac. It is the highest level since hitting 7.08% in early November. A year ago the rate averaged 5.30%.
The Board of Realtors said prices so far this year have steadied from the rapid rise seen through 2021 and the first half of 2022. At midyear the single-family home year-to-date median sales price was $1,050,000, down 5.5% from the June 2022 year-to-date median of $1,111,211. The $800,000-to-$999,999 range accounted for a notable portion of single-family home sales during the first half of this year.
The year-to-date condo median sales price was $500,000, just 2.9% below the June 2022 year-to-date median of $515,000.
Sellers have been taking less money for their properties to entice buyers. During the first half of the year, approximately 26% of single-family home sales closed for more than the original asking price, compared with 61% of sales during the same period in 2022. Fourteen percent of single-family home sales received full asking price, compared with 13% in 2022.
In the condo market, 21% of sales closed above the original asking price, compared with 43% in the first half of 2022. The share of condo sales that received full asking price was 21% year to date, compared with 19% a year ago.
Inventory has picked up from 2022 but is still far below pre-pandemic levels. At the end of June, the inventory of single-family homes was up 14.8% over the same time frame in 2022, while condo inventory was up 16.1% from a year earlier.
However, compared with pre-pandemic active inventory levels in 2019, single-family home inventory remained down more than 40%, while condo inventory was down more than 30%.
HOME SALES
The number of homes sold on Oahu in June with the median price and percentage change from the same month in 2022:
HOMES
SALES MEDIAN PRICE
June 2023 248 $1,050,000
June 2022 357 $1,100,000
Change -30.5% -4.5%
CONDOS
SALES MEDIAN PRICE
June 2023 470 $510,000
June 2022 626 $534,000
Change -24.9% -4.5%
Source: Honolulu Board of Realtors
