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Housing Bubble - Not Yet

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  • Housing Bubble - Not Yet

    Year on Year for April in West Hawaii under 1 million

    low price rose 8.7%
    avg price rose 2.4%
    med price rose 6.1%

    still going up but not quite as fast as the past 7 years.

    sorry to all you doomsday hopefuls. maybe next month.
    FutureNewsNetwork.com
    Energy answers are already here.

  • #2
    Re: Housing Bubble - Not Yet

    What are your predictions for HI's real estate market throughout the rest of the year?

    pax

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    • #3
      Re: Housing Bubble - Not Yet

      Originally posted by Pua'i Mana'o
      What are your predictions for HI's real estate market throughout the rest of the year?
      Or decade?

      Comment


      • #4
        Re: Housing Bubble - Not Yet

        Originally posted by dick
        Or decade?
        I thought about the stock line "past performance doesn't guarrantee future results", but I decided fo' make subtle.

        pax

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        • #5
          Re: Housing Bubble - Not Yet

          it's cyclical but this time because of the revised bancruptcy laws you're gonna see even more forclosures in the near future. These piggyback loans are really dangerous things to apply for when buying a home.

          I just hope our local economy can keep pace with the continued rise in property values.
          Life is what you make of it...so please read the instructions carefully.

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          • #6
            Re: Housing Bubble - Not Yet

            It is likely that housing trends in Hawaii in the next decade will follow birth trends that were set in the 50's.

            They are called the Baby Boomers. And there is over 60 million of em. And they are all gettin old at the same time. And the snow seems colder every year.

            The science of demographics involves very little guesswork.
            FutureNewsNetwork.com
            Energy answers are already here.

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            • #7
              Re: Housing Bubble - Not Yet

              Originally posted by timkona
              It is likely that housing trends in Hawaii in the next decade will follow birth trends that were set in the 50's.

              They are called the Baby Boomers. And there is over 60 million of em. And they are all gettin old at the same time. And the snow seems colder every year.

              The science of demographics involves very little guesswork.
              But do all of them have three-quarters of a million, plus the grand a month for maint. fees to spend?

              I suppose since there's a finite amount of space in Hawaii there will always be suckers out there who will shell out that kind of cash to live in a rabbit hutch...

              Whatever...

              Scenarios such as these make me wonder if my days here are finite as well..

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              • #8
                Re: Housing Bubble - Not Yet

                Oh oh, Tim Kona, must be getting slow, huh? A little worried? You've got used to the number of 550.00 appraisals that you've been doing. Now you sense that they are going to start drying up.

                According to UCLA economists, the markets that rose the most recently are going to pop. They even use the word "Bubble". They have been wrong on the exact timing but continue to be sure that a "bubble" exists in many US markets. There explanation for not being able to time the exact downturn in the real estate bubble is that its like expecting a psychiatrist to be able to tell you what a crazy man is going to say or do next. This market is crazy.

                Baby boomers do not want to move to Hawaii in significant numbers so that they can live with cockroaches, spiders, ants, beetles, mosquitoes, etc only to die of heat stroke, while being taxed in one of the worst tax states for low income/retirees while being thousands of miles away from their families and grandchildren. Boomers will continue to move to Florida, Arizona, North Carolina and even places like Mexico and South America.

                In addition, boomers, if anything, will likely DOWNSIZE their real estate holdings when they retire, not increase them. Money goes into bonds, treasuries, CDs and other less volitile investments.

                The boomer arguement comes from talking points from the National Realtor's Association. Its total BS.

                Prices will adjust back down so that the median home price will be about 4 to 5 times the average annual household income. (around 300K?) It always does. Even Tim Kona can't fight economic fundamentals. That's why he has to bank the future overpriced real estate prices in Hawaii on the "boomers". A demographic fact that no one can argue against but with a conclusion that has no basis. Based upon fundamentals like household incomes or prevailing rents, he cannot justify current prices.

                Hawaii's market will bust again. When? I don't know. But it will happen. It always does. The next bottom will occur in years, not months.

                We have a long way to go here.

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                • #9
                  Re: Housing Bubble - Not Yet

                  Originally posted by timkona
                  It is likely that housing trends in Hawaii in the next decade will follow birth trends that were set in the 50's.

                  They are called the Baby Boomers. And there is over 60 million of em. And they are all gettin old at the same time. And the snow seems colder every year.

                  The science of demographics involves very little guesswork.
                  Speaking of those guys.. last year I was in the Philippines.. a small number of Americans, Austrailans, Europeans and the like are moving over there where their retirement pension really goes a long long ways.

                  I have a funny feeling that more and more baby boomers will be driving up housing prices overseas and all the other more 'cheaper' places to retire wherever they might be.

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                  • #10
                    Re: Housing Bubble - Not Yet

                    Nice! We're outsourcing old people now too! I vote we outsource cemetaries next. There is some great land out there just infested with corpses.

                    Jewlipino

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                    • #11
                      Re: Housing Bubble - Not Yet

                      I gonna bet that the retirement housing market & the pharmaceutical industry for the next 10 years in Hawaii does what the birth charts did in the 50's, what the toy market did in the 60's, what college admissions did in the 70's, & what the basic economy did in the 80's.

                      Maybe there is a pattern here?

                      Many, who cannot understand the enormity of the number 60 million, would argue that there is clearly no pattern there.
                      FutureNewsNetwork.com
                      Energy answers are already here.

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                      • #12
                        Re: Housing Bubble - Not Yet

                        Timkona,

                        Since you're in the business,what percentage of loans in Hawaii (state) or on Hawaii (Big Island) are ARMs, Interest Only, Negative Amortization or any other of the "creative" types.

                        It was close to 40% nationally in 2005 last I heard. What about Hawaii?

                        And by the way, when 40% of buyers have an ARM loan, 40% of buyers are headed for a cliff. With them goes the real estate market.

                        Time is all it will take. Most of these will start cranking upwards over the next few years. It will be really ugly this time - at least Nationally speaking.
                        Last edited by kamuelakea; May 28, 2006, 07:43 PM.

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                        • #13
                          Re: Housing Bubble - Not Yet

                          I thought I'd read that "creative financing" in Hawaii was less common than on the mainland, in part because we've been conditioned through generations of high housing prices. We save up more and put down more for down payments, for example. Still, in looking for that statistic, I found some contrary statements.

                          Housing boom brings risks, FDIC says
                          As home prices have increased, buyers have increasingly relied on exotic mortgages to buy properties. According to the research firm LoanPerformance, one in four home purchasers in Hawaii so far this year relied on interest-only loans, which allow borrowers to pay only interest on their loans and make lower payments for the first several years. Likewise gaining in popularity are adjustable-rate mortgages, which also let buyers make lower monthly payments in the first several years. The risk with both of these is that monthly payments increase later, and depending on interest rates, the bills could rise so much that buyers could not make the payments and lenders would be left with a bunch of bad loans.
                          Personally, I don't anticipate a "crash" here in Hawaii, as demand will always be high, but imagine there'll definitely be a "dip" of some kind as a lot of these "creative financing" deals go bad. Or at least a slowdown.

                          In the long term, prices are just going to go up.

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                          • #14
                            Re: Housing Bubble - Not Yet

                            Originally posted by timkona
                            I gonna bet that the retirement housing market & the pharmaceutical industry for the next 10 years in Hawaii does what the birth charts did in the 50's, what the toy market did in the 60's, what college admissions did in the 70's, & what the basic economy did in the 80's.

                            Maybe there is a pattern here?

                            Many, who cannot understand the enormity of the number 60 million, would argue that there is clearly no pattern there.
                            Like you, I appreciate what demographics can do. However, they are not the only generation of consequence; as of 1996, they aren't the largest. My numbers quibble with yours, but according to the boomernomic stuff I read:

                            Matures: 12M
                            Baby Boomers: 76M
                            GenXers: 44M
                            Echo Boomers: 80M +

                            Following the pigs in the python, common sense says to pay attention to who moves the money. And if we are going to use this as a crystal ball, we need to pay attention to our investments when the EBs glut the market for entry-level jobs, which (fearfully) may coincide with the average-joe BBs retiring. Think about the 70's, when "Fire Daddy Hire Junior" and inflation kicked national ass. Speaking nationally, real estate fired up the economy in the 80s when those BBs became Thirtysomethings and started buying their first homes. Maybe we need to start making tie-ins and projections when these Xboxin' iPodin' Youtubin' Gap-wearin' kiddoes wield their economic muscle differently.

                            Ah, conjecture is free. We aren't even looking at other variables that can throw off the slope. Foreign investment increasing or decreasing, immigration, China and India becoming supereconomies, and war. Oh yeah, denge, ebola, sars, avian flues, etc.

                            I still say: live below your means, diversify your pennies across the globe, take care of your health and follow your bliss.

                            pax

                            Comment


                            • #15
                              Re: Housing Bubble - Not Yet

                              76 million Boomers instead of 60 milliion...oh well...I was just estimating anyway....but the more, the merrier....lord knows everybody loves their children and their siblings, which is why we are all so adamantly PRO-GROWTH.

                              If you want to know why Hawaii is growing, you should screw a mirror to the ceiling in your bedroom.
                              FutureNewsNetwork.com
                              Energy answers are already here.

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