Hawaii is a popular vacation spot, with lovely weather and beautiful beaches, but its housing market can be a tough coconut to crack. High home prices and low inventory make it particularly difficult for first-time homebuyers. So how will Hawaii’s housing market trend in 2019?
Housing markets fluctuate over time, and sometimes during the year. They’re influenced by things like unemployment rate, as people don’t buy homes when they’re unemployed, job growth and available inventory.
2019 Real Estate Market Forecast for Hawaii
Millennial buyers with growing families will be seeking to upgrade from first-time homes in 2019. They’re expected to take out over 45% of mortgages in 2019, even though mortgage interest rates will climb in 2019. If you think your home might appeal to a millennial buyer, now could be the time to sell.
Hawaiian home values rose 3.3% last year and will rise another 2.8% in 2019. Homes spend roughly three months on the market before they sell.
Honolulu prices haven’t grown much in the past year, likely because the median home value is already $672,700. Hilo home values rose 4.7% in 2018, and are predicted to rise another 4.1% in 2018, and homes in Kapolei lost 0.5% in value with another 0.2% expected.
Unemployment is much lower than the national average, at 2.7%, but the state lost 8,000 jobs in the last year. Population growth has been gradual, rising just 5.2% between the 2010 and 2015 censuses. All of this has combined to create a competitive market with low inventory, where locals compete for properties against foreign nationals and investors.
When Is the Best Time to Sell a House in Hawaii in 2019?
The best time to sell a house in Hawaii doesn’t follow the pattern set by the rest of the United States. May and June are the best months elsewhere, but in Hawaii, it’s December, January and February.
Visitors from the mainland pour into the islands during the cold months, and often end up deciding to purchase vacation properties. Demand is high but, since there are typically fewer homes on the market, you’ll have fewer other homes to compete against for buyers.
Professionals often suggest taking two months to perform minor repairs, including cosmetic work to prepare to have your home on the market. If you need to move by a specific date, lay out a specific time based on the typical closing timeline and work backwards from there to decide when to list.
When Is the Best Time to Buy a House in Hawaii in 2019?
If you’re a visitor looking for a vacation home, you might have to shop during the busy season. But full-time residents can wait until the market swings in their favor. Once the tourists have cleared out, you’ll have less competition for houses.
There is a significant military presence in Hawaii, and home buying also spikes at the end of summer when military families want to get settled and enroll their kids in school. Try to avoid house hunting during late July through August, if you can.
While buying in the off-season does reduce the amount of available inventory, the reality is that it’s a seller’s market in Hawaii. It’s never going to be easy to get a great deal on a house, but you can reduce other home buying costs by working with a low-commission, flat-fee realtor or asking about a home buyer’s rebate. And with interest rates rising, it might not be a good idea to keep waiting to enter the market.
Timing a home purchase value to try to get the best deal takes skill, so consult with a local realtor when deciding when to buy.
The housing market in Hawaii is unique in several respects; limited land on the islands, restrictions on development, and the number of out of state buyers. It’s a complex market not well-suited for owners to sell their homes themselves. Partner with a local real estate agent to navigate the market successfully.
A local real estate agent has their finger on the pulse of what’s happening on your island and in your neighborhood. It takes years to gain this in-depth knowledge, which is why Clever only draws our partners from the top agents at major brokerages such as Century 21 and Keller Williams.
If you’re selling, your agent will put together a Comparative Market Analysis which takes data from recent local sales to help you decide on the best price for your home. If you’re buying in a less-than-favorable market, you’ll need to draw on every ounce of your agent’s negotiation skills. Either way, they work on your behalf to achieve an optimal outcome.