Hawaii remains one of the world’s most rare and attractive housing markets, and as the recovery continues, interest in buying and renting in Hawaii is bound to grow.
NAA Apartmentalize 2022 in San Diego
The persistent trend to remote work will benefit the state although inflation and low numbers of rental units will reduce this cultural trend. Still, with housing markets in San Diego, Phoenix, Los Angeles, Dallas, Austin, San Francisco and Miami so expensive, Honolulu may become migrants preference.
And the return of the vacation market will bolster the short term rental property market along with the general residential real estate market.
See the latest stats from March and February below on Hawaii’s major residential real estate markets including Honolulu, and Maui.
Hawaii Real Estate Hits All Time High Price
Sales of homes falling but not stopping price from marching upward. Sales of homes and condos diverged in February and but prices did not.
With limited and dropping inventory of houses for sale, buyers will likely need to bid harder to acquire their next home. Sales have been subdued for several months in a quiet season, but signs are that things might be reawakening despite rising mortgage rates.
However, across all US residential real estate markets rising rates are taking a bite out of sales, and could begin to deter new construction in the Aloha state. Mortgage applications have dropped 40% in the last with an even steeper drop in the last 8 months.
With fewer buyers able to achieve financing, it would certainly affect capability to buy in the Hawaiian real estate market.
House Sales in February 2022
Total sales of houses across the state of Hawaii in February 2022 fell 8%. while condo sales increased by 3.2% year over year. Housing sales declined the most on Maui with a drop of 14.85%.
The decline steepest on the islands of Hawai’i and Kaua’i where sales took a 17% and 16.2% dive respectively YoY. Home prices overall have still risen strongly with a 21.95% growth overall, including Kaua’i where prices rocketed 37.54% YoY. There were 596 home sales in February 2022.
Condo prices rose strongly over the last 12 months as well, at 16.8% clip. There were 774 total sales at an average price of $633,750.
Screenshot courtesy of Hawaii Realtors Association, Hicentral, and Realtors association of Maui.
Redfin Hawaii Market Reports:
Redfin reports the median house price in Hawaii reach $696,000 in February which is up 10.4% from 12 months go. It shows a downtrend in price. Redfin also says home inventory has dropped 22.3% from 12 months ago and that 39.8% of homes sold above list price, which is 14.6% from last February.
Definitely share any our posts and material with your friends and business partners. Hawaii is a special place and the climate, culture, lifestyle, or business opportunities in Honolulu will draw digital nomads and rental property buyers here in 2022.
Oahu & Metro Honolulu Housing Market
The Honolulu Board of REALTORS® reports strong home price increases year over year. Both Honolulu condos and single family houses bounced back from the off season lull, jumping 27.1% to $1,150,000 from $905,000 in February 2021.
Single family homes in the city had sales fall 7.3% vs 12 months previous yet prices rocketed forward by 22.6%. Condos on the other hand saw a sales increase of 9% while $497,000, while prices rose 8.6% year over year.
Chad Takesue, president, Honolulu Board of REALTORS® said, “Along with rising median sales prices for both markets, median list prices are also starting to tick up as sellers take advantage of the lack of competition. Lack of inventory continues to be our number one challenge of getting families into homes. Active inventory remains significantly below pre-pandemic levels.”
Oahu Housing Market February 2022. Screenshot courtesy of Hicentral.com
They report that sales of houses below $900,000 plummeted 54% year over year. Anything below $900,000 might be considered affordable in Hawaii.
Pending sales for houses in Honolulu dropped 13.4% during February. In Hawai’i Kai, listings have dropped 150%, while in Ewa Plain listings are down 50% and in the Kailua region, listings have dropped 44%. Condo listings in Metro Honolulu however have risen almost 26%. Days on market dropped to 13 days for single-family homes and 14 days for condos.
Maui Housing Market
Realtors Association of Maui reports that the median price of a home on Maui rose 19.5% to $1,177,500, up from $985,000 12 months ago.
As in other Hawaii islands, sales of houses dropped by 17%. Those sales rates however are still above historical averages.
Average prices are climbing every year at a steady clip as depicted in the charts below. Falling house inventory is the story of this market too.
Maui average home selling price. Screenshot courtesy of Realtors Association of Maui.
Inventory of Maui houses for sale has plummeted 25.7% in the past 12 months to low of 1.8 months supply.
Single Family House Market Maui. Screenshot courtesy of Realtors Association of Maui.
Condominium market overview. Screenshot courtesy of Realtors Association of Maui.
The Hawaii Luxury Market
During the pandemic many new millionaires were born and plenty of them had their eyes on owning Hawaii real estate. The island of Kau’i was where many of them bought new million dollar dream homes. On each island however, there was growth.
Although there is an range of housing in Hawaii within reach, this market is more about the luxury market. High demand combined with limited availability creates ultra high real estate prices. The downside of that is a lack of affordable properties and also big challenges for renters.
Hawaii Life found that the growth of Hawaii’s ultra-luxury market this year has been exceptional. Transaction volume has risen from $151 million in 2020 to more than $1 billion in the first three quarters of 2021 alone.
The big news is how the ultra luxury market is faring in Hawaii. Hawaii Life reports strong sales activity in the luxury market with inventory falling from 5.3 months to 1.6 months of supply. Sales value has grown an astonishing 234.5% over 2020 (by dollar value). Hawaii Life in their major report, found that in the third quarter of 2021, 634 sales home priced above $3 million included 466 sales in the $3 million to $5.99 million range, 104 in the $6 million to $9.99 million range, and 64 sales of over $10 million.
You can see more on Hawaii’s exclusive luxury market and their beautifully packaged 3rd quarter report on the hawaiilife.com/blog/2021-luxury-market-report website.
Make sure you keep up on the latest in property management news, technology and markets on our blog! Definitely, review the benefits of our property management software.
Property Management Companies in Hawaii
Looking for a property management company in Hawaii? Service providers are evolving with new digital software solutions that may make a big difference for you in 2022. Check out these property management firms in Hawaii.
Big Interest in Hawaii Real Estate
Each year Americans, i.e., Californians search for houses for sale in Hawaii. Some are just looking as they visit for their annual golf vacations. And that’s how the word about Hawaii real estate has always spread.
Japanese and other foreign buyers are deeply interested too, however the 2020 Covid pandemic threats and travel restrictions have reduced interest from foreign buyers.
In an interview on sfgate.com, Hawaii RealtorJulie Peters, an agent with Island Boutique Realty said she sold 5 properties unseen. She cites that California, Oregon and Washington is where buyers are coming from.
From January to June 2020, California residents bought $587.6 million worth of Hawaii property, making up 41% of total sales during that period coming from the U.S., according to Title Guaranty, which owns and maintains the largest real estate database in Hawaii. – report on sfgate.com
Maui is a market of few listings and big price increases. Definitely a sellers market.Buyers from California, Arizona, UK, Australia, China, Germany, Russia, Japan, Canada, and other nations are the typical source for buyers according to sources. With recession talk in the past, one more stimulus payout, and good economic reports coming out, are Oahu real estate prices going to surge significantly in 2022?
Hawaii New Housing Construction
Will Hawaii’s builders come to the rescue? The stats actually show builders have grown their construction permits in the 3rd quarter of 2021 but are not keeping up with demand.
dbedt.hawaii.gov reports that during the 3rd third quarter of 2021, private building authorizations in the state increased $94.2 million or 11.2 percent% with the third quarter of 2020. And so far this year, private building authorizations throughout all islands grew $764.8 million or 32.9% vs same period last year.
Hawaii Housing Market Forecast: Demand to 2025
The Hawaii state government produced a report that suggests 19% growth in population by 2025. It adds that by 2025, Hawaii County’s population will grow 29%, Maui County’s by 25%, and Kauai County will rise by 19%. They forecast that housing demand by county is 25,847 units for Honolulu, 19,610 for Hawaii, 13,949 for Maui, and 5,287 for Kauai during the 2015-2025 period.
Foreign Buyers are the Key
Buyers from California, Arizona, China, Germany, Russia, Japan, Canada, and other nations have competed for too little real estate resulting in bidding wars and ultrahigh prices. If international sales slows, we’d wonder about where demand would come from in the years ahead. Given inflation and rising rent prices in Hawaii, income rental property investors will find this state a tough market to be successful in.
Looking for a Hawaii property management company? Ensure they’re using a modern cloud based property management solution.
Hawaiian Paradise Too Hard to Resist
And Hawaii’s peace and serenity, beaches, parks, golf courses, hiking, Honolulu urban life, and culture are irresistible to buyers and tourists around the world. And you never know which tourist will decide to buy property on the Hawaiian islands.
Hawai‘i is a competitive, low-inventory housing market. The growth of purchases in the Aloha state in the last few years is astonishing yet housing supply will inevitably curtail sales and grow prices in 2021. Billions of real estate investment dollars have flowed into the Hawaii real estate market in the last few years.
Honolulu is the focus of most real estate investment interest. Investment is likely to grow.
Housing Market Conditions?
Screen capture courtesy of huduser.gov
The Hawaiian economy is strong, unemployment is low and wages have risen over 4%. That makes for solid demand for rental units. The issue however is that rent prices are beyond the reach of most.
In 2020, Hawaii will likely continue as the least affordable housing market in the country, and as you’ve learned condo prices in some Hawaiian counties are rocketing.
Note: if you’re interested in international real estate, please check out our posts on the Australian housing marketand Berlin and London UKrental property market and the UK housing market.
Building permits reflect future construction trends and volume, and Hawaii’s year over year growth was at a brisk 62% over the last few years. Because of the pandemic, 2022 stats are not available as yet. Please bookmark this page and we’ll update when new data is released.
Screenshot courtesy of Hawaii.gov
Here are the latest Hawaii public housing starts numbers from the FED:
Screenshot courtesy of Hawaii.gov
With house and apartment construction numbers flagging so badly, we might forecast home prices and rent prices to rocket in 2021.
Hawaii’s Economy Doing Well
Hawaii’s economy is very dependent on US overall economic activity, tourism and upon Japan’s economy.
Tourism spending dropped 2% YoY in May, although spending by Canadians rose. Visitors from California and Japan slowed their spending, and dropped severely by visitors from elsewhere around the globe (-17%). Stats show a strong increase in visitors arriving via the airports and projections forward are for steady, strong growth.
Screenshot courtesy of Hawaii.gov
GDP was predicted to grow strongly through 2022. The pandemic has taken a toll on all economies, however Hawaii should bounce back as shut in Americans, Japanese, Canadians, and Europeans come of out of lockdown isolation.
Hawaii’s real GDP growth is expected to increase 1.4% in both 2020 and 2021. Wages were rising and that should support higher apartment rental prices in 2021. See this forecast chart on economic indicators forward to 2021.
Hawaii economic report – screen capture courtesy of Hawaii.gov Research and Economic Analysis
Types of Property Purchases in Hawaii
Similar to most housing markets in the US, Hawaii lacks housing supply which drives up prices. Another factor comes from lending rates affected by Hawaii’s unique real estate laws. Buyers who buy leasehold properties may not qualify for 30 year mortgage rates.
Hawaii real estate is offered in two different types: fee simple and leasehold. With fee-simple, property buyers have complete ownership of the property, which includes the land and any improvements to the land in perpetuity.
Leasehold ownership on the other hand means the buyer does not own the land; instead, they have a right to use the land for a predetermined amount of time. When the lease is up, the land reverts to the lesser. If you’re buying multifamily property, these rules could pose a problem.
Hawaiian lenders may prefer owner-occupied property financing, and those investing in rentals may face higher financing costs. There are residency requirements to qualify for government-backed Fannie Mae or Freddie Mac loan programs.
Hawaii’s Rental Market
Although apartment rental prices have declined in the last 12 months, Hawaii is one of the least affordable states to rent or buy as a rental property investor. Limited supply translates to big rent increases. Rental prices may be falling, however prices are often beyond the reach of many Hawaiians.
Contrast Hawaiian apartment prices to general US rental prices for apartments or houses.
Additional Housing and Property Management Topics:
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The Honolulu Board of REALTORS® reports strong home price increases year over year. Both Honolulu condos and single family houses bounced back from the off season lull, jumping 27.1% to $1,150,000 from $905,000 in February 2021.How is the housing market in Oahu? ›
Sales in June are down from last year, -21% for homes and down -16% for condos over June 2021. Year-to-date, home sales are now down -6% from last year, while condo sales are still increasing, up 13%.Is real estate in Hawaii a good investment? ›
Real estate investments and rental income can provide a steady, secure source of income, that helps over the years and during retirement. If you plan properly and buy right, an investment in Hawaii real estate is typically a safe and rewarding investment.What is the real estate market like in Hawaii? ›
|Hawaii real estate market forecast for sellers|
|⏰ Homes are selling 9 days faster than the annual average||💰 Homes are selling for $82,596 more than the annual average|
|💸 Average listing commission: 2.54%||💸 Average buyer's commission: 2.45%|
Home Prices Will Likely Continue To Climb
“Prices throughout the country have surged for the better part of two years, including in the first quarter of 2022. . . Given the extremely low inventory, we're unlikely to see price declines, but appreciation should slow in the coming months.”
Another good thing about Maui real estate is that it consistently shows high rates of appreciation. According to Zillow, the value of real estate properties in Maui has increased by 10.1 percent from 2020 to 2021. The average value of homes in the county rose from $770,000 to $782,000 from June to July this year.What is the average price of a home in Maui? ›
In March 2021, median sales prices for single-family homes on Maui were $985,000. In January, the previous record for single-family homes on Maui was set at $1.16 million. These numbers come from the Realtors Association of Maui.What is the average income in Oahu? ›
|Mean travel time to work (minutes), workers age 16 years+, 2016-2020||28.4|
|Income & Poverty|
|Median household income (in 2020 dollars), 2016-2020||$87,722|
|Per capita income in past 12 months (in 2020 dollars), 2016-2020||$38,288|
How much does an Average make in Hawaii? As of Jul 29, 2022, the average annual pay for the Average jobs category in Hawaii is $78,131 a year. Just in case you need a simple salary calculator, that works out to be approximately $37.56 an hour. This is the equivalent of $1,503/week or $6,511/month.Which Hawaiian island is best for investment? ›
Wailuku. Wailuku should be at the top of the list for all real estate investors wanting to get in on the Hawaiian property market.
Maui - "The Valley Isle"
In South Maui, Makena features some of the most luxurious vacation homes in Hawaii, with golf, tennis, boating, and secluded beaches. In the same area, Wailea, Maui Meadows, and Kihei offer condos, home sites, and residences.
The Big Island of Hawaii leads all the other islands with both the lowest priced homes at just $242,500 and condos at an average price of $225,900. This home (MLS# 250786) listed at just $249,000 is an example of the great real estate values on the Big Island.Why are houses so expensive in Hawaii? ›
Essentially, Hawaii severely limits the supply of land available for housing, which is a main reason the median housing cost per square foot in 2018 was $547 on Oahu, $548 on Maui, $456 on Kauai, and $282 on the Big Island — all much higher than the national figure of $114 at the time.What is the housing market like in Honolulu? ›
The Honolulu housing market is somewhat competitive. Homes in Honolulu receive 4 offers on average and sell in around 54 days. The average sale price of a home in Honolulu was $578K last month, up 10.7% since last year. The average sale price per square foot in Honolulu is $731, up 12.7% since last year.What is the average price of a home in Honolulu Hawaii? ›
$873,012. The typical home value of homes in Honolulu is $873,012. This value is seasonally adjusted and only includes the middle price tier of homes.Is Kauai a good investment? ›
Kauai ranks among top 10 places to buy a beach house, Vacasa report says. Kauai was No. 6 on Vacasa's list of the best places to buy a beach house in 2019, which analyzed home prices and capitalization rates for vacation rental properties.Is it a good time to buy a house on Maui? ›
High demand for housing will keep prices stable on Maui. Even though home prices have risen, the low cost of borrowing means there are still some good deals out there.Is Airbnb profitable in Hawaii? ›
Rental Income Can Provide a Cash Flow
The money is like an extra income each month, and it may grow when rent rises in line with the market. Rents in Hawaii often rise, so your monthly cash flow may rise over time. The average rent for a one-bedroom Airbnb Honolulu Hawaii is roughly $2,000 as of July 2021.
When will the MAUI Housing Bubble BURST? - YouTubeWhat is the minimum wage in Maui? ›
Hawaii's minimum wage is currently $10.10 an hour.
Maui Real Estate in High Demand
The “knowns” in the market are that we are squeezed for inventory and Maui is in high demand, feeding the price escalation. What's more, we have yet to see the return of international buyers to the market, which will only add to the demand side of the equation.
If you decide to rent, you're looking payment of just under $2,000 per month, and that's if you pay the median price. To keep the utilities running in a small apartment in Honolulu, you're facing a cost of around $285 per month.What is a livable salary in Hawaii? ›
|1 ADULT||2 ADULTS (BOTH WORKING)|
|0 Children||2 Children|
According to the Hawaii Department of Business, Economic Development & Tourism's (DBEDT) self-sufficiency income standards, the average resident needs to make $17.63 per hour in 2020 to enjoy a living wage. This would cover expenses like housing, food, transportation, healthcare and other expenses.What is a good salary in Honolulu Hawaii? ›
A person working in Honolulu typically earns around 80,000 USD per year. Salaries range from 20,200 USD (lowest average) to 357,000 USD (highest average, actual maximum salary is higher). This is the average yearly salary including housing, transport, and other benefits.What is a good salary in Oahu? ›
|Annual Salary||Monthly Pay|
- Waikiki. Although homes in Waikiki lost an average value of 2.8% last year, forecasts over the next 12 months put the region at a smaller loss of 0.6%. ...
- Pearl City. ...
- Hilo. ...
- Kahului. ...
- Urban Honolulu Metro.
If you're just looking at the sheer number of incidents on each island, Kauai is the safest island to live on. In 2020, the Kauai Police Department reported the lowest number of violent crime incidents and property crime incidents of any of the four major islands.Which Hawaiian island has the lowest real estate prices? ›
Generally, the lowest housing costs are on the Big Island, which is considered the cheapest Hawaiian island to live on.
- Hilo. Hilo is the largest city on the Island of Hawaii. ...
- Waianae. What if you could live in a cheaper area but still be on the same island as Honolulu? ...
- Kailua. Kailua is a nice community even closer to Honolulu. ...
- Kahului. ...
- Waimea CDP (Kauai County)
- Hana, Maui.
- Hilo, Island of Hawaii.
- Kahuku, Oahu.
- Kapa'a, Kauai.
- Wailuku, Maui.
- Waimalu, Oahu.
Best Places to Live in Hawaii
On the beautiful island of Oahu, there is Kailua, Hauula, Makaha, and, of course, the famous Honolulu. If you're looking for beautiful towns on the island of Kauai, definitely head to Waimea, Hanapepe, Wailua, and Hanalei. Hana, Maui is another incredible choice.
Hana is easily one of the cheapest places to live in Hawaii. The median housing price of $459,100 is well below the state average, and the $941 median monthly rent is, too.Are Hawaii property taxes high? ›
The state of Hawaii has the lowest property tax rate in the nation at 0.28%. Despite this, the median annual tax payment in the state is $1,871, which is much higher. This is because Hawaii has the highest median home value in the U.S. at $669,200.Are taxes high in Hawaii? ›
Hawaii has a 4.00 percent state sales tax rate, a 0.50 percent max local sales tax rate, and an average combined state and local sales tax rate of 4.44 percent. Hawaii's tax system ranks 41st overall on our 2022 State Business Tax Climate Index.What is Hawaii's minimum wage? ›
Hawaii enacted the nation's first statewide $18 minimum wage law, with Gov. David Ige's signature of a bill aimed at fighting poverty among the islands' workers. The measure, HB 2510, will raise the state's minimum wage gradually from $10.10 per hour, first to $12 on Oct.Are houses expensive in Honolulu? ›
Honolulu is the third-most expensive city to buy a home, with buyers paying a median of $684 per square foot to buy a 1,000-square-foot home, according to a report by the moving and storage website move.org.What is the hottest month in Hawaii? ›
The hottest month of the year in Honolulu is August, with an average high of 87°F and low of 76°F.How much do you need to retire in Hawaii? ›
Hawaii. The average annual retirement income in Hawaii is $119,004 to live comfortably. Hawaii's average retirement age is on the older side at 66 years; however, it has the highest life expectancy of any U.S. state at 81.50 years. To live comfortably in this period, one would need to save $1.84 million before retiring ...
According to a 2017 study by the U.S. Energy Information Administration (EIA), an energy bill in Hawaii goes for an average of $149.33 per month. That's almost $38 more expensive than the $111.67 national average.Will Maui real estate market crash? ›
When will the MAUI Housing Bubble BURST? - YouTubeWhy is Hawaii real estate so expensive? ›
Essentially, Hawaii severely limits the supply of land available for housing, which is a main reason the median housing cost per square foot in 2018 was $547 on Oahu, $548 on Maui, $456 on Kauai, and $282 on the Big Island — all much higher than the national figure of $114 at the time.Are house prices going to crash? ›
Based on this data, Capital Economics has forecast house prices to rise throughout 2022, before falling by 5% in 2023.What is the average cost of a home in Hawaii? ›
As of December 2021, the median price of a home in Hawaii was $1.06 million, according to real estate firm Locations Hawaii.Will housing market crash Hawaii? ›
HONOLULU (HawaiiNewsNow) - Mortgage rates continue to rise, but that's not expected to cool Hawaii's hot housing market. According to Freddie Mac, 30-year-mortgage interest rates now stand at 5.23%. However, real estate experts and bankers don't think that will force down record high prices.Will the housing bubble burst? ›
Actually, economists do not think it will. Housing economists point to five main reasons that the market will not crash anytime soon: low inventory, lack of new-construction housing, large amounts of new buyers, strict lending standards and a drop in foreclosures.Whats the cost of living in Hawaii? ›
Hawaii cost of living is 170.0.
|COST OF LIVING||Hawaii||United States|