Half-million-dollar housing

[Glen Miyashiro]

Half of all single-family dwellings on the Island sold for more than $505,000 in January, a 26.3 percent rise over the $400,000 median a year earlier, according to Honolulu Board of Realtors data released today. (http://the.honoluluadvertiser.com/article/2005/Feb/02/br/br08p.html)Good god. I'm not sure which number appalls me more, the $505,000 or the 26.3% increase.

[LikaNui]

There's a townhome complex in Kaneohe that I'm very familiar with. Exactly two years ago the average sale price was $303,000 and now it's clear up to $495,000.

[kimo55]

There's a townhome complex in Kaneohe that I'm very familiar with. Exactly two years ago the average sale price was $303,000 and now it's clear up to $495,000.


helluva jump...


back in the late 60's, some homes, (you know which ones...) in Lanikai were selling at $80,000. Same homes now; $800,000.

[Glen Miyashiro]

I wonder if anyone has numbers on how much house you can afford with the median Hawai'i household income? I'd like to see those figures put side by side with the realtors' housing sales statistics. :(

[Miulang]

According to the Census Bureau statistics for 2003, the median household income for Hawai'i was almost $52,000. That means 50% of households earned more than $52,000 and 50% earned less. I'm pretty sure why Hawai'i has one of the highest median incomes in the US is because there are at least 2 working adults in each household. That's about $1,000/week. The old rule of thumb for mortgages used to be 30%, but now I think it's more like 50%. My guess is on a 30 year fixed mortgage, a family bringing in $50,000 annually and paying about $2,000/mo could probably afford a $500,000 house. But then there would be virtually nothing left for "other" things, like utility, food, gas, car payments, etc. The pinch is not so much the monthly mortgage but the hefty down payment you'd probably have to make to qualify for a loan of $500,000. (To qualify for certain types of mortgages, you have to put down at least 20% of the purchase price to avoid having to pay mortgage insurance).

http://www.census.gov/hhes/income/histinc/h08.html

Miulang

[1stwahine]

I guess thats why my three children (all in military) are getting together to purchase property (not new) with a home or two on it. Their Military benefits of buying a home and being first time buyers will surely be a plus. They want to get me out of Mayor Wrights asap. It's not funny anymore. I still want my FREEDOM and don't plan to be a HomeAlone Granny. I'm gonna live and be a hep granny. They're always trying to BOSS me since my husband died. I ain't gonna move! High prices of homes...buy now, everyday it goes up! ;)

Their re-enlistment BONUSES and pay being in a Combat Zone comes in handy too. Alot of tears and sleepless nights too!

[808_m3]

It's the same deal here in the SF bay area as well. A collegue of mine purchased a home in Redwood City and bought a really nice place in San Ramon. He originally bought it for 200K and sold it for 700K. The equity on the sale was applied as a large down payment to his nice place in San Ramon. Now, he lives in a very nice area with almost the same mortgage every month.

I gather this is what people are doing in Hawaii. With the low mortgage interest rates and the limited supply of housing, these factors are just driving the prices up. People are cashing out their equity and upgrading their homes.

I just wished my spouse and I did the Hawaii home investment earlier, at least it would have been some chunk of change to be had.

[Miulang]

If you think housing prices on Oahu are ridiculous, read this article in this morning's Advertiser about neighbor island housing prices and really get scared! :eek:

Miulang

http://the.honoluluadvertiser.com/article/2005/Feb/10/bz/bz01p.html

[pzarquon]

From the article:Big Island median prices were up 18 percent to $294,000 from $249,000 for condos, and up 54 percent to $352,750 from $229,500 for single-family homes, according to Hawaii Information Service.Eep. To think that ten years ago, I was relieve somewhat to think that Hilo would always be there for me if I never quite found the cash to stay in Honolulu. The sad thing is, compared to the Oahu median, $352,750 still seems downright reasonable.

[Glen Miyashiro]

...and now the median home sale price on O'ahu is up to $550,000 (http://starbulletin.com/2005/04/05/news/index1.html). Eep, indeed.

[craigwatanabe]

For the shell-shocked Oahu home buyers (I was one previously) even with the higher prices that have hit the East Hawaii market (lower Puna, Hilo, Hamakua) it's still a bargain, but the prices are moving up quite rapidly and if you want to buy a really choice piece of property in this market, nows the time to do it.

Realistically if you wanted to live anywhere but West Oahu to avoid the morning and afternoon rush hour traffic, half a million was the baseline for affordable housing within the city limits as long ago as two years ago! Now that area is more like $600,000 and up. For half a million dollars you can buy an incredable piece of property here on the Big Island comparable to Kahala homes on one acre lots. For a million dollars you get some tremendous real estate. On Oahu a million gets you middle to upper middle class nowdays. In Keaau, that million gets you Hawaii Loa status!

[Miulang]

This is a textbook case of high demand increasing the price of housing and real estate overall in Hawai'i and elsewhere.

Many Boomers had once invested heavily in the stock market but with the uncertainty in that arena and the Prez' threats to redefine Social Security, they are pulling out their savings and retirement funds and investing in real estate. (http://the.honoluluadvertiser.com/article/2005/Apr/10/bz/bz10p.html)
Unfortunately (depending on whether you're a buyer or a seller), what goes up eventually will have to come down, and the real estate market will someday have to crash, which is about the only time locals will be able to again afford to purchase housing at reasonable prices.

Maybe the State needs to make it more painful for people to own investment property, while giving more tax breaks to those who live in their houses.

Miulang

[Linkmeister]

We once thought we'd have a vacation (or retirement) home in Royal Gardens near Kalapana on the Big Island, and we bought a lot there. Alas, while the land increased by accretion, it dropped in value. :D

[kimo55]

heard of homes being put on the market for around 400k and then, ultimately selling for 800k plus. Imagine getting that much OVER your asking price. Bidding wars are not unheard of lately.

[Glen Miyashiro]

It's happening in California, too.

LOS ANGELES -- California households are making less than half the income necessary to buy a median-priced home in the first quarter of 2005.

Statewide households, with a median household income of $53,540, are $60,380 short of the $113,920 qualifying income needed to purchase a median-priced home at $488,600 in California, according to the California Association of Realtors (C.A.R.) Homebuyer Income Gap Index (HIGI) report for the first quarter of 2005. (source (http://story.news.yahoo.com/s/sddt/majorityofcaliforniansmakelessthanhalftheincomenee ) )

[pzarquon]

Fascinating. And they're not half as crunched for basic space as we are.

Let's see. Hawaii's median household income? $50,110, according to DBEDT ($51,010 in 2000-2001, dropping to $47,748 in 2001-2002, according to the U.S. Census Bureau). Median home prices? On Oahu $550,000, on Maui $632,000, and on the Big Island $365,000.

I don't know how the California agency determined "qualifying income needed," but the gap seems larger here, especially accounting for taxes and cost of living.

[Linkmeister]

Can anyone say housing "bubble?" At some point it's gonna have to stop or slow down, and when that happens there goes the construction industry as well.

[Miulang]

I think the rule of thumb for a mortgage used to be that it take up no more than about 25-30% of your monthly income. And if you didn't put down a substantial downpayment (or unless you were a veteran) of at least 20%, there was PMI (mortgage insurance) tacked on to your mortgage until your equity equalled 20% of the cost of the house. I think now lenders are allowing people to spend about 40% of their monthly income to qualify for a loan. And with housing costing in the $100s of thousands, some people take out horrendously long terms which they will probably not outlive, which means the burden will be passed on to their heirs.

I've refinanced my condo three times since 1991 (the last time was last year) and my mortgage is only about $750 a month. So I throw in an extra $100/month and will have my 15-year fixed rate mortgage paid off in 11 years. I have lots of money to go out and have fun with and still manage to put some away for my retirement. I don't know how people can stand to be living so close to the edge...and now the bankruptcy laws are going to make it harder for people to get off scott free, so it means they will still be burdened with payments, even if they can't afford it.

I blame the banks and mortgage companies for allowing people to get into houses they couldn't normally afford. Which is why, when the housing bubble bursts, there should be a bunch of foreclosed houses that are going to start looking like real bargains, because the financial institutions don't want to be homeowners. That's how some large banks got in trouble the last time this happened and created such a huge scandal in Texas and Washington DC.

Miulang

[pzarquon]

Half a million dollars is starting to sound like a bargain.

Maui homes near $700,000 (http://the.honoluluadvertiser.com/article/2005/May/10/bz/bz03p.html)
Andrew Gomes, Honolulu Advertiser, Tuesday, May 10, 2005
Million-dollar home sales jacked up the median price for houses on Maui last month to just shy of $700,000 — a statewide high that brokers expect could go higher. The Realtors Association of Maui said the median price of previously owned single-family homes was $695,950 in April, up 36 percent from $512,500 a year earlier and up 10 percent from $635,000 in March...

Big Island single-family homes sold last month for a median of $370,000, or 34 percent higher than the $276,000 median a year earlier... On Kaua'i, the median single-family home price was $540,000 last month, up 14 percent from $475,000 a year earlier, Hawaii Information Service reported.

[Fisherman]

That is insane

[Miulang]

Half a million is nothing on Maui now. The median price (http://www.mauinews.com/story.aspx?id=8751) of a single family house is now about $5,000 short of $1 MILLION. Of course, what's kind of skewing things are the multimillion dollar properties in Wailea and Kapalua and Kaanapali, but my guess is you'd be damned lucky to get into any kind of single family house for less than $700k. And you guys on Oahu think you have problems.

Miulang

[pzarquon]

I was at a lunch today where the mantra was, "In Hawaii, the best time to buy is always right now." Yike. So while everyone else nationwide is worried about a bubble bursting, do y'all agree that prices are never going to go down here?

[Glen Miyashiro]

Eh Miulang, read your articles closer before you cite them. That's the median asking price you're talking about; the median selling price is still around $700,000.

[Glen Miyashiro]

I was at a lunch today where the mantra was, "In Hawaii, the best time to buy is always right now." Yike. So while everyone else nationwide is worried about a bubble bursting, do y'all agree that prices are never going to go down here?Yup. Unless the global economy completely tanks, in which case affording a new house will be pretty low on my list of worries.

[Miulang]

Eh Miulang, read your articles closer before you cite them. That's the median asking price you're talking about; the median selling price is still around $700,000.
The properties in Wailea and Kapalua are going for over $1 million; my cousin's mother-in-law who just died had a house the family is trying to sell for $1.25 million. It's a plantation style house (over 50 years old) with a large yard, termites, etc. but it's in Kaanapali, and just down the road from the beach. I get they get what they're asking for it and the new owners will just tear down the house and build a new one on top of it.

Miulang

P.S. the bubble will burst when the stock market starts yielding better returns, the interest rate on mortgages goes back up to > 7 or 8% (from the 3% ARMS some people are getting now) and people can't afford to lock in rates and have to sell or go into foreclosure. I never understood why people wanted to get ARMs unless they were planning to live in the house less than 5 years. My last refi got me a 5.25% fixed rate, 15-year mortgage, and that's just fine with me.

[AuntieNellieKulolo]

I was at a lunch today where the mantra was, "In Hawaii, the best time to buy is always right now." Yike. So while everyone else nationwide is worried about a bubble bursting, do y'all agree that prices are never going to go down here?

Oy. It's getting to be just as bad as NYC, where a single person really needs to make at least $50K to support oneself in any kind of comfort, privacy or security. The most run-down, tiniest studios(even in subway-accessible parts of Bklyn or Queens) easily rent for $1,000 and up now. :eek: I saw a Craigslist NYC post where someone was complaining 'but I'm single and only make $60K/year.....' Just try making it on less than 2/3 of that... And to think I moved here from Honolulu b/c I thought I would have a better standard of living.... :mad:

[pzarquon]

Interesting story in today's Star-Bulletin reporting on the urban legend of sorts that Oprah Winfrey caused housing prices to rise (http://starbulletin.com/2005/05/13/business/story2.html) because she talked up buying land in Hilo. While she owns 102 acres on Maui, turns out she didn't explicitly encourage her watchers to go and buy us out.

Her exact words were: "So if you get oceanfront property in Hawaii, a couple thousand acres ... right along the beach. God's not making any more land in Hawaii."

Except, of course, there is more land being made out here! :p It just won't be ready for that beachfront mansion until, oh, the year 2,005,234.

[Glen Miyashiro]

Except, of course, there is more land being made out here! :p It just won't be ready for that beachfront mansion until, oh, the year 2,005,234.Heh; an oldie but a goodie. My favorite version was in one of the Pidgin to da Max books, that had a mock real estate ad offering some of those really hot properties. There was a photo of a "realtor" being quoted as saying, "Wotta deal! Acre today, acre-half tomorrow!"

[Miulang]

Interesting story in today's Star-Bulletin reporting on the urban legend of sorts that Oprah Winfrey caused housing prices to rise (http://starbulletin.com/2005/05/13/business/story2.html) because she talked up buying land in Hilo. While she owns 102 acres on Maui, turns out she didn't explicitly encourage her watchers to go and buy us out.

Her exact words were: "So if you get oceanfront property in Hawaii, a couple thousand acres ... right along the beach. God's not making any more land in Hawaii."

Except, of course, there is more land being made out here! :p It just won't be ready for that beachfront mansion until, oh, the year 2,005,234.
Oprah happens to be a very good neighbor on Maui. She bought a ranch (her former trainer Bob Greene lives next door) and isn't planning to develop any of the land...just wants to keep it the way it is. She is one of the decent Mainlanders who realize that the land in Hawai'i is finite and as much as possible should be kept free of development, unlike a software mogul whose name is scorned upon by certain locals.

George Harrison owned a house in Hana. He built the house so that it was virtually invisible from the road (I flew over it in a helicopter). There are good malihinis in the 'aina. You just never hear about them as much as you do the bad ones.

Miulang

[Miulang]

Lessee..the developer Haseko Homes (http://the.honoluluadvertiser.com/article/2005/May/17/bz/bz01p.html), who has built housing developments over the past few years in 'Ewa, wants a permit to construct another 901 houses in a master project to be called "Ocean Pointe".

My guess is that "Ocean Pointe" will not be moderate or low income housing :rolleyes: and that that part of town will have another 3,000 or so inhabitants crowding the highways. Now if the development was called "Ocean Point", then maybe there might be some moderately priced homes. But what a difference in several hundreds of thousands of dollars that final "e" at the end of the name is gonna make to potential buyers. And the developer will be laughing his way to the bank.

Miulang

[Miulang]

Chief Economist Alan Greenspan (http://money.cnn.com/2005/05/20/news/economy/fed_housing.reut/index.htm?cnn=yes) sayeth there be not a national housing bubble, but there beith local bubbles that will inevitably soon burst. Methinks one of those local bubbles is going to be Hawai'i, where people are buying second homes and investment property and where many people are getting themselves in over their heads with low cost ARMs that will put them into foreclosure once the mortgage rates go up.

Miulang

[pzarquon]

Hawaii posts second-highest home prices in the country (http://starbulletin.com/2005/05/25/business/story1.html)
Allison Schaefers, Honolulu Star-Bulletin, Wednesday, May 25, 2005
Hawaii had the second-priciest homes in the country in 2003, after California, according to a nationwide housing survey released yesterday by the U.S. Census Bureau. Hawaii residents who took part in the home value portion of the U.S. Census Bureau's American Community Survey two years ago indicated they thought their house or apartment would sell for a median of $302,300...

The median sales price of a home on Oahu was $399,000 in December 2003, according to the board. Condominiums sold for a median of $180,000... Last month, median single-family home prices were highest on Maui, where more than 50 percent of the homes sold for more than $696,000. The median home price on Oahu in April hit a record $545,000 and homes on Kauai followed closely at $540,000. The Big Island median price rose to $370,000.

[mel]

The price of a new home will go even higher after a Democrat supported bill to raise the conveyance tax on all properties over $600,000 becomes law. When will the taxing madness stop? Hawaii is already one of the highest cost of living states in the U.S. We don't need more taxes!

[Glen Miyashiro]

Now the median O'ahu resale price is $610,000.

"The fundamental sources of strength in housing demand are real, not imaginary, so this is not a bubble," Brewbaker said.

"Is it a bubble? This ain't no stinkin' bubble."

[Paul Brewbaker, Bank of Hawaii economist]
(Honolulu Star-Bulletin (http://starbulletin.com/2005/06/03/news/story1.html), 6/3/05)

[Miulang]

Now the median O'ahu resale price is $610,000.
Heh. Maybe it's a conspiracy by the State government to increase tax income since the conveyance tax on houses > $600k is going up! ;)

Miulang

[Miulang]

Now the median O'ahu resale price is $610,000.
Heh. Maybe it's a conspiracy by the State government to increase tax income since the conveyance tax on houses > $600k is going up so more real estate will be nonexempt! ;)

Miulang

[HomegrownHawaii.com]

Today's Advertiser had a pretty interesting article regarding the housing crunch in Hawaii. A realtor in the article recently purchased a 1 bedroom condo after losing 17 pervious bids, one of which he lost after asking $50,000 over the asking price. Hard to believe that Hawaii could/can get anymore expensive.

[ahola]

In 2004 total residential mortgage debt outstanding grew by 13.2% to $8.7 trillion, the fastest rate of annual growth since 1986 and is now greater than our Federal government debt.
23% of all residential home sales in 2004 were for investment purposes.
Speculators are using interest only and adjustable rate loans to buy up overpriced properties with negative cash flows.

Las Vegas was up more than 50 percent in 2004 and several California and Florida regions gained 30 percent or more which
far surpass increases in personal income (5.8 percent) and rental prices (2.7 percent).

Fannie Mae and Freddie Mac have come into the limelight with serious accounting scandals that have forced them to restate earnings for previous years proving a negative effect in the billions of dollars.

The real estate bubble is swimming upstream in a downstream economy and with a glut of mortgage debt.New mortgage lending practices have led to more highly leveraged home buying have introduced a fundamental change to the housing market.If interest rates climb rapidly, it could leave many homeowners with far larger monthly mortgage payments than they have now. If that happens, it would add inventory to the market, forcing prices down and instead of housing busts resulting in small price downturns we may see large percentage losses.

When the crowd believes prices can't fall and line up to bid auction style on properties that a couple years earlier would have been on the market for six months,it is the beginning of the end of any asset bubble.

Stay in the vulture position with cash in hand and wait for the bubble to start bursting pretty soon and you will be able to steal these at rockbottom prices.Don't follow the herd and just let them try to outbid each other on the properties.They will regret winning the bidding war and will have to deal with bankruptcies and foreclosures.Just swoop in and snap them up when the bubble starts to deflate.Then rent them for a positive cash flow and hold until they go back up.

[kimo55]

In 2004 total residential mortgage debt outstanding grew....



or go here for the full story

http://www.zealllc.com/2005/rebubble2.htm

http://www.321gold.com/editorials/wright/wright052705.html

http://www.reiclub.com/forums/index.php?board=29;action=display;threadid=5423

http://money.cnn.com/2005/05/03/real_estate/financing/boom_bust/

[LikaNui]

or go here for the full story [/url]
I hate to go off-topic, but... welcome back, Kimo! We've missed ya around here!
:p

[kimo55]

I hate to go off-topic, but... welcome back, Kimo! We've missed ya around here!
:p

....at da risk of another possible exile for going off topic again, I will say:
mahalos, mahalos fo dat!




(the irrepressible Kimo. can't hold back. gotta sing. gotta dance. azzwhy hahd, eh?!)

[memorylane]

My theory for the high prices: ITS HAWAII! I'd dang sure pay it if i had it.
I have always wondered this, hopefully not too OT.......why are the homes *stars* live in so so high???? Is it because its Cali and simply because its known that they have that kind of money?
I find home like Sting over in England for instance, basically CASTLES for only a few mil compared to 16 mil payed by so and so.....
:rolleyes:

[dick]

Based purely on principle, I will never buy a house/apartment in Hawaii (not at these inflated prices). People are completely out of their minds to be paying that kind of money for (the most part) veritable shacks. As soon as a better job on the mainland comes along, I am so out of here. And yes, I'm born and raised here, and lived away and came back only to face this farce of a situation. Hell, if I stayed in Idaho, I would have had by now a huge house for a fraction of what I could get here. Hell, if I stayed in Tokyo I could have actually afforded to buy a place there. There are idiots out there who will actually get sucked up into the hype and go and spend half a mil to buy a piece of crap. I can only pray that this really is a bubble so I can sit smug and see all these clowns who are fueling this fiasco go down in flames. You get what you deserve.

[pzarquon]

I hope it's a bubble, too, but for some strange reason, even if there is a pop or crash, I doubt it's going to offer much relief. At this point, it looks like my choices are Waianae, rural Big Island, or Pacific Northwest. I'm aiming for the Big Island. :)

I'm sure happy for, and jealous of, those folks I know who snapped up places ten years ago for $290,000. Now they're sitting on (or living in!) gold mines! The taxes have gotta suck, sure... but renting sucks more.

[AuntieNellieKulolo]

My theory for the high prices: ITS HAWAII! I'd dang sure pay it if i had it.
I have always wondered this, hopefully not too OT.......why are the homes *stars* live in so so high???? Is it because its Cali and simply because its known that they have that kind of money?
I find home like Sting over in England for instance, basically CASTLES for only a few mil compared to 16 mil payed by so and so.....
:rolleyes:

It seems like housing prices are insane anywhere somebody would actually want to live: NYC area, SF Bay, San Diego(the craziest housing market according to the latest issue of Money mag), etc. Anywhere there are jobs and cultural amenities and/or good climate.

[Glen Miyashiro]

I see it as a result of the globalization of wealth. In the old days, you wouldn't live (or own a house) in Hawai'i unless you had some sort of reason to be there: your family is there, your job is there, your Huge Tracts of Land are there, etc. But now, travel and communication are so easy to do that if you have the money, you can live virtually anywhere. Therefore, why not live (or at least own a vacation house) in the most beautiful and/or interesting places on the planet? After all, Hawai'i is only a plane flight away from most other places, and they've got broadband Internet and cell phone service like everywhere else in the Civilized World. It sucks for us locals who've had the islands mostly to ourselves all these decades, but I don't see a way around it.

[poi cocktail :)]

what I find kinda' revolting are the flippers like that show on tv. the one agent buys a condo and with no experience (let alone drawings or permits) does major renovations to get out in 90 days with 90k profit. craftsmanship? ha! warranty? ha! just wait till those buyers see the show on tv. caveat emptor indeed.

but unless you rockafeller no one is going to hand it to you. everybody's first place is a stretch. buy right and you be happy later. as they say, they ain't making more land (unless you like go to the moon :D )

[LikaNui]

what I find kinda' revolting are the flippers like that show on tv. the one agent buys a condo and with no experience (let alone drawings or permits) does major renovations to get out in 90 days with 90k profit.
In Kaneohe last year, a gentleman bought a townhouse at our property for his father to live in. Father decided he'd rather live town-side, so the son re-sold the unit 9 months later.
For a $110,000 profit.
And all he'd done to the unit was to steam-clean the carpet. No need major renovations to make those huge profits!
:eek:

[ahola]

what I find kinda' revolting are the flippers like that show on tv. the one agent buys a condo and with no experience (let alone drawings or permits) does major renovations to get out in 90 days with 90k profit. craftsmanship? ha! warranty? ha! just wait till those buyers see the show on tv. caveat emptor indeed.

but unless you rockafeller no one is going to hand it to you. everybody's first place is a stretch. buy right and you be happy later. as they say, they ain't making more land (unless you like go to the moon :D )


Joe Six-Pack sitting at home watching late night infomercials finds out that for only $300 he could sit in some hotel conference room and listen to someone speak and he can become a millionaire overnight by buying distressed properties with no money down.A lot easier than spending years studying hard at good schools and working years building capital and acquiring knowledge.He is also the one living paycheck to paycheck with mortgage,car loan,and credit card debts, and spending his meager savings on lottery tickets.PT Barnum was right.

[Miulang]

I have to chuckle when I see these get rich schemes still being advertised on TV. By the time these guys are rich enough to pay for their infomercials, the time for profit taking by flipping real estate is just about over.

Granted, the guys who cashed in on this 5 years ago made out like bandits, but as the stock market and economy improve, interest rates will start rising, and those no- or low interest short term ARMs all of a sudden are going to bite some people in the okole. Yes, real estate is a "safe" investment, but when the bubble bursts, will those greedy people be able to sell the houses quickly and still make those profits before the taxman forecloses?

The same thing happens with the stock market. By the time people catch on to a "hot" stock, the profit takers have already cashed in and gone on their merry way.

Miulang

[poi cocktail :)]

the good ole' pump and dump :D we just seeing variations of a theme. and again everyone from the sellers to the buyers to the lenders are in on "it". somebody eventually is left holding the bag.

re: late night tv hucksters. so many to choose from. Tom Vu was about the funniest with his stereotypical buck teeth and heavy accent, sitting very tanned on an expensive boat surrounded by bikini clad showgirls, "if I cun do it, so cun yoo!" LOL is he still serving time? Carlton Sheets is still doing a bang up business. the Milans and that other short 1-900 guy switched from RE to hawking other schemes like selling on ebay.

not to say they are liars or cheats (ahem) but one would do so much better by attending a real estate school and getting licensed. all that info and more is right there without any get rich twists.

[Miulang]

Possibly. At least that's what 2 people in the industry told a meeting (http://www.mauinews.com/story.aspx?id=10438) of the Realtors Association of Maui yesterday.

That would come as a huge relief for people who have been priced out of the market for their first home. However, the market probably won't crash immediately: it'll be more like a souffle that just came out of the oven and is left standing on the counter for awhile. It would be nice if the "greed" factor was diluted.

Miulang

[Miulang]

The first batch of 200 converted units at the Ala Moana Hotel (http://www.honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20050723/BUSINESS/507230323/1071) went on sale yesterday at the 1,150 unit building. There are more than 3,000 people waiting in line to buy the remaining units (each of whom had to put down a $10,000 deposit just to hold a place in the line), which means about 2/3 of those people will be disappointed.

A studio unit is selling for about $120,000 or higher. A one-bedroom unit with a kitchenette is going for about $500k. Monthly maintenance fees are $385, which doesn't include utilities or phone or cable. And I'm sorry, but I've never seen an apartment/hotel conversion to condos have anything more than shoddy workmanship because anything that started out as a rental is bound to be built with the minimum building code standards. Looks nice when you first move in, and then things start "breaking". Hope the buyers will get some kind of guarantee for 10 years that if anything major breaks, the developers will have to pay.

Looks like in downtown Waikiki anyway, even condos are out of the price range of many people, and it's just one more venue that's been taken off the "budget" hotel list for tourists.

Miulang

[Miulang]

The first batch of units went on the market last week at the Keola la'i (http://www.honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20050726/BUSINESS/507260319/1071) development for prices ranging from $340,000 for a one-bedroom up to the mid-800s for the 3-bedroom units. What's even sadder is that a portion of the units are on the market as investment units, which means even fewer people out of the pool will have the opportunity to buy a place to live in permanently. :mad:

And to think...even as recently as 10 years ago, you could still find nice houses on the market in the islands for less than $300,000. Now people are resigned to buying small condominiums for that amount of money.

Miulang

[lurkah]

It's like watching one sponge...slowly...slowly...slowly...soaking up a large puddle of water...until eventually...da time will come...when da sponge reaches its saturation point...with still more water...flowing into da puddle.

Would YOU be wanting to live in an environment like that? http://ohanalanai.com/lanai/images/smilies/pity.gif

[craigwatanabe]

To put things into perspective, back in 1962 there was a new development in the Waialau Nui valley (above Kahala Mall). It was a tract home development on leased land. We moved from our small cramped 2-bedroom Palolo house on Jasmine street selling it for a mighty sum of $5,000. Imagine that!

My dad bought a three bedroom 2-bath cement foundation ranch style home on just over 10,000 sq ft of land for $27,000 by putting $500 down. In 1986 the land was offered for fee and we bought it for $60,000. Total investment: $87,000.

In 1992 we sold the property for $575,000. My parents bought a house in Hilo for $327,000 and bank rolled the rest. They're living happily ever after now. Basically, they made a killing!

[Stephen]

While I may not the be the most well schooled real estate investor (I am however a mortgage broker,) I will make this bold prediction. . . . . in the next 12 months, as interest rates rise, the housing bubble will pop - just like a wad of bubble gum on a big league baseball diamond. I know that the demand in Hawaii is huge right now (I would argue a lot of it has resulted from baby boomer's fear of the stock market,) but when the rates start to go up, buying power goes down, people with adjustable rates lose their homes (which is very sad) )and so on. I could be wrong - and I'm selling my house right now - but I do believe that the markets that have ridiculous appreciation (NYC, LA, SD, SF, and HI) are going to crash.

Slightly off topic, two things for Craig - first, you've got to love when your parents get rewarded/lucky - we only get two of them - if we're lucky. The second is that my wife and I are relocating to Hawaii - O'ahu to start, but are very interested in the Big Island - I understand that housing is much more reasonable (if you can really call it that!!!) and with the two psuedo major metro's, job opportunities are good as well - am I off base?

Mahalo,
Stephen

[Palolo Joe]

]My dad bought a three bedroom 2-bath cement foundation ranch style home on just over 10,000 sq ft of land for $27,000 by putting $500 down. In 1986 the land was offered for fee and we bought it for $60,000. Total investment: $87,000.Man, I don't even want to go back to the 60's... just a couple of decades to when 87k could get me into Kahala. There simply aren't the same opportunities anymore...

[Palolo Joe]

Or maybe there are opportunities...

http://www.latimes.com/business/careers/work/la-me-atm19jul19,1,7516215.story?coll=la-headlines-business-careers

[Miulang]

OK, so some of the people who bought units in 909 Kapiolani (http://starbulletin.com/2005/07/30/news/index2.html) in Kaka'ako just received notice that their pre-sold units will cost them up to 25% more than they originally thought. They need to let the developer know by Aug. 12 if they still want into the project.

Can you imagine thinking you already knew the price you would have to pay to move into your condo and had your financing all figured out, and then you find out it might cost as much as $125k more???

Can you say "lawsuits"? :mad:

Miulang

[kimo55]

they sing a contract stipulating this may occur. so they have no recourse.

[MadAzza]

they sing a contract stipulating this may occur.

Neat-O. Is that like a barbershop quartet?

(OK, spelling flames are pretty weak, but I couldn't help myself ...)

[kimo55]

Neat-O. Is that like a barbershop quartet?




all fore of them. In unionison

[Glen Miyashiro]

The median sale price on O'ahu dropped slightly to $599,000 in July, down from the high of $610,000 in May. However, the more expensive areas are still sky-high:

In higher-demand regions of Oahu, median sales prices went through the roof last month, said Jim Mazzola, principal broker at the Windward office for Coldwell Banker Pacific Properties.

More than half of the buyers in Hawaii Kai paid $922,500 for a single-family home last month. That was followed closely by Kailua and the North Shore, where the median prices reached $885,000 and $787,500, respectively.

(Star-Bulletin (http://starbulletin.com/2005/08/03/business/story1.html))

[Miulang]

Maybe the Hawai'i housing souffle is finally deflating a bit. They reported the same kind of thing happening on Maui for June and July, too. Of course, the houses are still way overvalued, even though the prices have come down slightly.

Miulang

[Miulang]

Private residential housing prices on Maui may have leveled off or dipped, but the market for resort residences (http://www.mauinews.com/story.aspx?id=11517) (the ones in the planned resort communities like Wailea and Kapalua) are still red hot. People from the mainland are welcome to those, because it generally means they won't be permanent residents, but leave the other housing to the locals and make it affordable!

Miulang

[Miulang]

Gee, I don't know if this makes you feel warm and fuzzy about the Honolulu housing market, but Honolulu is not the most overpriced area (http://www.usatoday.com/money/economy/housing/2005-08-16-home-prices-usat_x.htm) in the country. Honolulu is only 77th out of 299 (http://www.usatoday.com/money/perfi/housing/2005-08-17-housing-valuations.htm) major metropolitan areas that have overpriced houses. But in Honolulu, houses are costing about 23% more than they're worth. You want undervalued real estate? Go to College Station, TX.

Miulang

[MadAzza]

You want undervalued real estate? Go to College Station, TX.

Well, of course. It's in Texas!

<snicker>

[Miulang]

Anybody know how far away this new Centex multimillion dollar per condo development at Ko Olina (http://www.honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20050907/BUSINESS/509070327/1071) is going to be from the central landfill???? and who do you think will buy the units? Out of towners or locals?

Miulang

[Glen Miyashiro]

Anybody know how far away this new Centex multimillion dollar per condo development at Ko Olina (http://www.honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20050907/BUSINESS/509070327/1071) is going to be from the central landfill???? and who do you think will buy the units? Out of towners or locals?As the crow flies, about 4000 feet. Check out this Google Map (http://maps.google.com/maps?ll=21.342907,-158.120298&spn=0.018151,0.026786&t=h&hl=en) -- set it to "Hybrid" view and you'll see the landfill at the top of the page. Zoom in one notch and you'll see that Waiali‘i Place, where the new condos are sited, is the little street south of Kamoana Place, next to the second-furthest-north of the four artificial beaches.

[Miulang]

As the crow flies, about 4000 feet. Check out this Google Map (http://maps.google.com/maps?ll=21.342907,-158.120298&spn=0.018151,0.026786&t=h&hl=en) -- set it to "Hybrid" view and you'll see the landfill at the top of the page. Zoom in one notch and you'll see that Waiali‘i Place, where the new condos are sited, is the little street south of Kamoana Place, next to the second-furthest-north of the four artificial beaches.
Thnks, Glen. I know Oahu is an island with limited acreage, but geez...to spend $2 million to be less than a mile from a landfill? Eeew...what happens when the wind direction shifts...

Miulang

[Glen Miyashiro]

Thnks, Glen. I know Oahu is an island with limited acreage, but geez...to spend $2 million to be less than a mile from a landfill? Eeew...what happens when the wind direction shifts...Not to mention, if you look at the traffic patterns, you'll see that to get in and out of that whole luxury development, you drive on Farrington Highway and get off on Ali‘inui Drive. That turnoff is less than 1000 feet from the landfill's driveway, on the other side of a small hill, where trucks drive in and out all day long.