Oahu Real Estate Market Report for January 2024
Aloha and welcome to the Oahu Market Report for January 2024, brought to you with List Sotheby's International Realty. As we start the year, we're already witnessing a significant uptick in market activity. Let's delve into the numbers and discuss what's happening in the marketplace.
There's been a noticeable shift in the market, primarily driven by the recent decrease in mortgage interest rates. Over the last two months of the previous year, rates fell from 8% to just under 7%. This change has spurred a considerable increase in buyer activity, making our January and February particularly busy with new clients, offers, and general real estate transactions. The impact of these changes isn't uniform across all sectors. For example, single-family homes priced around $3 million and below have seen a significant increase in demand. My recent listing in Kailua is a testament to this, having received multiple offers well above the asking price. However, this level of competition is not the same for every property. The market is performing much better in certain sectors, with little to no change in others. For example, the high-end resale condo market has seen little to no impact as of now.
The key points are, firstly, that interest rates have dropped, leading to a 22% increase in mortgage applications and a significant boost in buyer confidence and activity. Secondly, it's crucial to understand that the housing data we're discussing lags slightly due to the typical 45-day transaction period. Many of the properties in the data first entered escrow in mid-November and December. This means we're only now beginning to see the real impact of these changes in our market statistics.
Let's look at some specifics. The median sales price for Single Family Homes in January was an impressive $1,021,016 million, marking a 5.3% increase from last year. Sales numbers are also up, with a 22.7% increase compared to January of the previous year. These strong numbers are largely attributed to the recent positive news from the Federal Reserve and the subsequent decrease in mortgage interest rates. However, while both numbers are strong, I don't place much emphasis on a single month's data, especially holiday data. But, as mentioned, activity has increased at the start of the year, so I expect the next few months' sales numbers to show increases in both the number of sales and prices.
Housing inventory remains significantly restricted, with currently 607 homes actively for sale on the market. For perspective, I often reference pre-pandemic inventory levels; in 2019, the lowest number of homes actively for sale in any month was 1,641. Consequently, sellers are receiving, on average, 98.3% of their asking price, and 23% of homes sold for at or above their asking price. Homes sold in January spent an average of 29 days on the market before going into escrow.
For condos, the median sales price for January was up 1.5% to $502,500. The number of sales increased by 6.2% compared to the same month last year, indicating more modest activity in the condo market over the holiday period. The median days on market for condos matched single-family homes at 29 days.
Inventory levels also grew in the condo market, but inventory remains restricted with 1,348 condos actively available for sale. Compared to the pre-pandemic market, inventory is down by 53%. This has led to sellers receiving 97.5% of their list price, with 17% of condos sold last month fetching full price or more.
The inflation figures are significant news. As inflation cools and mortgage rates drop, we should expect more buyers to enter the marketplace. If you wait for rates to decrease before buying, competition will likely continue to increase and drive prices up. The longer you wait, the more you may end up paying for the home you're seeking.
If you're considering buying or selling a home or condo in Oahu, now is the time to get in touch. Remember - this post and the information on this website are no substitute for personalized advice. Our team of experienced real estate professionals is ready to guide you through the process and help you make the most of the current market conditions. Contact us today to get started!