2008 October | Honolulu Real Estate Views

Archive for October, 2008

Lessons From A Honolulu Home Sale

October 30th, 2008 categories: Honolulu Real Estate 101

This past September I was hired to sell a home located on Honolulu’s Waialae Nui Ridge (CLICK HERE FOR A CMA). It was a 3 bedroom 3 bathroom split level home that sat on 7,700 square feet of land and showed impeccably. The list price was $1,145,000 and it sold in 5 days for $1,200,000. Note that we had multiple offers and this was an important factor in getting the price to move above full list price. There are many questions that arise from this sale and here are a few of them.

1. September was one of the worst months in economic history, how were we able to sell so quickly and at a price that was higher than the original list price?
2. Isn’t the market “bad” and isn’t it a bad time to sell?
3. Aren’t all of the buyers waiting to see what happens with the economic bailout?

Awesome kitchen!

Here are 5 lessons from this sale.

Lesson 1. I expected the property would sell in the range of $1,100,000 to $1,200,000. I recommended a list price of $1,100,000 and the seller chose to list at $1,145,000. In this market a property has to be priced exactly (if not below) where it is expected to sell. If properly priced, Honolulu homes and condos will sell and they will sell fast.
Lesson 2. Proper pricing took away any buyer’s ability to sit and wait. This property was a good enough value that buyers had to fear losing it if they chose to wait to make an offer. In fact, one of the first buyers to see the property waited a few days and seemed very disappointed to have missed the opportunity.
Lesson 3. By receiving offers immediately, the days on market remained very short. If a property is on the market too long, it is very likely that a seller will receive less money. For some reason to many days on market, allows a buyer to believe that they can offer a lower price. In today’s world, with proper marketing, a seller should receive written offers within 2 to 3 weeks of coming on the market. If activity is low or if no offers are made, then the price is probably too high.
Lesson 4. This home showed very, very well! The owner took the time to organize, de-clutter and have the home cleaned before we began showing. Just like selling a detailed car, a clean and well showing home will garner more interest and money than one that shows up like a fixer upper.
Lesson 5. The six P’s can make you money (Prior-proper-planning-prevents-poor-performance)! By taking the time to prepare the home and properly price, we were able to get sold in a market that some believe to be difficult.

If you would like to discuss selling your Honolulu condo or home, call me at 808-737-2093, as I would love to talk with you.

Spoken by Keahi Pelayo | Discussion: 1 Comment »

Honolulu Condo Deal Of The Week!

October 29th, 2008 categories: Honolulu Condominiums

On Monday of this week, a buyer client of mine closed one of the better deals I have seen in sometime. The unit is 2 bedroom 2 bathroom high floor apartment at the Mauna Luan Condominium in Hawaii Kai. It listed for $560,000 and closed at $509,000 (a 9.1% reduction in price!). In my opinion, the unit had the best remodel I have ever seen at the Mauna Luan. The kitchens, bathrooms, bedrooms, ceilings and just about anything you can think of were replaced in 2005. Though the Mauna Luan was built in 1975, this condo felt like it was brand new. I do not know how much the seller spent to put it in this condition, but it was easily $150,000 to $200,000 worth of work. It is difficult to tell, but at the peak of the market it may have sold at $600,000 (plus or minus $25,000).

CLICK HERE FOR A CMA ON THE MAUNA LUAN

New cabinets in the kitchen.

So why report this? There are a number of lessons from this sale. Here are a few of the more important. Please remember hindsight is 20/20 and we will never know if my hypotheses are correct, but I offer them anyway. Read the rest of this entry »

Spoken by Keahi Pelayo | Discussion: 1 Comment »

Honolulu 3 bedroom Condominium Investment

October 29th, 2008 categories: Buying Honolulu Real Estate, Honolulu Condominiums

This 3 bedroom 1.5 bathroom condominium is offered at $350,000 and it is in a Honolulu condominium called Terrace Towers. At 918 square feet it comes with one open parking stall. The kitchen and bathroom cabinets were changed in 2006 and the unit would make an excellent home for a first time buyer or rental income property for an investor. I checked with a local property manager and he felt that the unit would rent in a range between $1900 and $2300 per month. The following is a brief analysis of a possible investment scenario based on a rental rate of $2200 per month.

Monthly Expenses
Maintenance fee $379
Property Taxes $95
General Excise Tax $104
Total $578

Monthly Rent $2200
Less Expenses $578
Net Income Before Mortgage Payments $1,622

An investor mortgage payment of $1,622 at 6.5%, amortized over 30 years will carry a mortgage of $256,000.

Based on a new loan of $256,000, a buyer of this property would need a down payment of $94,000.

CLICK HERE FOR AN MLS FACT SHEET

Terrace Towers is a healthy walk from the University of Hawaii, two blocks from Iolani School and 5 to 10 minute drive from Ala Moana Shopping Center or Waikiki. There are four different freeway entrances a 1 to 2 mile drive from your parking stall. Do you have a student ready to attend one of the very close universities? Why pay for a dorm when you could own an investment? Call me at 808-737-2093 or toll free at 877-737-2093 to see if this might meet your investment needs.

Note-please don’t rely on this information to make your investment decision. Make sure that you confirm the validity of the numbers contained in this analysis.

Spoken by Keahi Pelayo | Discussion: 1 Comment »

One of Kailua’s Best Condominium Projects

October 28th, 2008 categories: Honolulu Condominiums

As you come over the Pali to Kailua, there seems to be just one high rise condominium and that is Windward Passage. Most brokers agree that it is one of the (if not the) most desirable condominiums in the area. The ongoing redevelopment of Kailua Town makes the future of this project very bright. You may have heard that DR Horton has purchased all of the older 2 story apartments on Kailua Road across from the school. If you have not been to this area recently, I am happy to report that they have all been torn down and construction of a new condo project seems to be underway. When this construction is finished the entire area will be upgraded and this improvement should have a very positive impact local real estate values.

Over the years this unit has been a rental and could be moved into right now or someone might do a total remodel. It has the convenience of a stack washer and dryer, large storage closet in the unit and a second bedroom that can be opened to the living room. Here are more specifics.

2 bedrooms
2 baths
964 square feet interior
92 square feet of lanai
1056 square feet of total area
2 covered parking
$367 monthly maintenance fees (includes basic cable, hot water, water & sewer)
$149 a month current taxes

The building offers the luxury of being able to walk to dining, shopping and entertainment. The grounds are large and well maintained and offer the following amenities.

Dog run
Heated pool
Tennis courts
Sauna
Exercise room
Secured access entry (via fob)
Plenty of guest parking

WINDWARD PASSAGE COMPS

For more details or to schedule a showing, please call me at 808-737-2093.

Stylish Honolulu 3 Bedroom Unit in Nuuanu

October 28th, 2008 categories: Honolulu Condominiums, Honolulu Real Estate 101

Guess what this blog is about? Yes, you’re right, I have just listed a very special
Nuuanu Parkside three bedroom unit for sale. The last three bedroom to sell closed in July of 2006, and it sold at $5950,000. This apartment is listed for $600,000! Because there are just four units per floor, each of them is a corner end unit. This means that the bedrooms, the living room and kitchen all have excellent views of Punchbowl, the city, ocean, downtown and, in the evening, city lights. On top of this, each of them has its own lanai. The lanai off of the living room is perfect for dining with a view. An elegant entry begins your enjoyable walk through a very usable and private layout. The master bedroom is on the Ewa side of the apartment with the second and third bedrooms are the perfect distance away for privacy. It’s simple elegance is complimented by engineered maple wood flooring, white solid surface counter tops, Jennair cook top and a kitchen with a view from two windows. The coup-de-grace is that this unit comes with two side by side covered parking stalls! One of my core beliefs is that an individual apartment unit is only as good as the overall quality of the building it is in. Be happy because this is a terrific building.

Begin with a secured entry which is manned 24/7 by security staff, a covered circular drive allows your guests to enter the clean and elegant lobby out of any potential weather. Guest parking, car wash area, gated parking structure, heated salt water swimming pool, a legitimate work out room, wine room with a personal storage locker for your fine wine, business center (with desk, computer, fax machine & copier) and party room, private park with gazebo for your barbecuing pleasure, round out a nearly perfect residence. You get the point…this is a terrific building.

To say you don’t see these units sell very often is to be understated. In fact, since January of 2006, only five units have sold. Four were two bedrooms and one was a three bedroom. TO SEE THE COMPARATIVE MARKET ANALYSIS OF THESE SALES JUST CLICK HERE. Three bedrooms may be even more rare, since there is only one three bedroom per floor. I did a search for 3 bedroom sales back to 2004 and found that there have be four sold. By my estimate, on average, one three bedroom per year sells at Nuuanu Parkside. Sooooo, if you want to be in a three bedroom in this building…call me now to see it.

Spoken by Keahi Pelayo | Discussion: 1 Comment »

Great View Home In Aiea (Newtown) $699,000

October 28th, 2008 categories: Buying Honolulu Real Estate

This 3 bedroom 2 bathroom 1,744 square foot home is located at the end of a cul-de-sac on a 6,561 square foot rim lot. This location offers fabulous views and a level of privacy that is hard to find. It is priced at $699,000 and can be moved into right away. The kitchen is very usable with a large dining area located just beyond the pass through. The two-car garage is big with high ceilings and it has access right into to the kitchen for easy unloading of groceries. Vaulted ceilings throughout the home make it feel much larger than one might expect for its square footage. Please call me at 808-737-2093 to schedule a showing.

COMPARABLE SALES FOR THE AREA.

Other Properties Available For Sale
Makakilo Gardens-$249,000
Terrace Towers-$350,000

Spoken by Keahi Pelayo | Discussion: No Comments »

Real Estate Myths Busted!

October 28th, 2008 categories: Rants & Riffs

Frontdoor.com is a very interesting Internet site. It has excellent tips for buyers and sellers of condos and home. One of its recent posts talks about the “10 Real Estate Market Myths”. In a world awash in negativity, it is nice to hear some positive clarity. The first myth they debunked is below.

“Peak-to-trough home price declines to date have been about 20 percent. Wrong. Measurements of home price declines can be skewed depending on which homes in which markets are being measured. For instance, the Case-Shiller Index, which indicates that home prices are down 20 percent, is heavily skewed towards homes with subprime loans and other distressed home sales. These troubled homes have experienced a steeper decline than home prices in general, says Yun, adding that both government data based on loans backed by Fannie Mae and Freddie Mac and data from the National Association of Realtors suggest much more modest price declines. TIP: If you’re selling your home, the best thing to do is price your home right.”
CLICK HERE TO READ THE ENTIRE POST.

To find out the truth about Honolulu homes and condos, call me at 808-737-2093 or toll free at 877-737-2093.

Spoken by Keahi Pelayo | Discussion: No Comments »

Buffett Sees Buffet!

October 27th, 2008 categories: Rants & Riffs

One of the richest men in the U.S., Warren Buffett, sees a great deal of opportunity in our stock market. A Bloomberg.com article says the following.

“Warren Buffett said he’s buying U.S. stocks and, if prices stay attractive, his personal investments, as distinct from his stake in Berkshire Hathaway Inc., will soon be wholly in American equities.

Writing in the New York Times, he said he’s following the principle: be fearful when others are greedy, and greedy when others are fearful.

Exaggerated concern about the long-term prosperity of the many sound U.S. companies is foolish, and most will probably be setting profit records in years to come, Buffett said.”
CLICK HERE TO READ THE ARTICLE

I am similarly bullish on core Honolulu real estate and here is why.

1. Low interest rates-with the Fed injecting a great deal of money into the economy, I believe we will have low interest rates in the short to mid-term. This means, when confidence returns, buyers will be able to buy with very low monthly payments.

2. Demand-even with all that has occurred in the financial markets, my sense is that buyers are tentative, but they still want to buy because living in Honolulu is so desirable.

3. Low supply-though supply is up some, in comparison to historic numbers, it is at a moderate level. This means that our market could turn very quickly.

4. Hawaii-this is Hawaii…need I say more. Our appeal to those who do not live here is strong. A newly minted prosperity happens around the world, in the past, those nouvelle riche will want to own in paradise.

Since values are flat and may be moving incrementally down and there is a good selection of inventory, I believe this is an opportune time to buy. Call me at 808-737-2093 (toll free 877-737-2093) to discuss taking advantage of this market.

Spoken by Keahi Pelayo | Discussion: No Comments »

Strengthening Yen Good For Honolulu Real Estate

October 24th, 2008 categories: Honolulu Real Estate 101, Rants & Riffs

Since the late 1980’s Japanese investors have been significant players in the Honolulu real estate market. A recent article at Bloomberg.com shows that the yen is at a 13 year high against the dollar.

“The yen climbed to a 13-year high against the dollar as a worldwide drop in stocks encouraged investors to dump higher-yielding assets and pay back low-cost loans in Japan.

Japan’s currency surged to the strongest in six years against the euro as the prospect of a deepening global recession prompted the unwinding of carry trades. The pound fell below $1.53 after the U.K. economy shrank in the third quarter. The dollar rose to a two-year high versus the euro as investors sought refuge in the greenback.”
CLICK HERE TO READ THE ENTIRE ARTICLE

When other parts of the US real estate market are slow, in the past, international interest in Hawaii has helped to drive home and condo values. So the weakness in the dollar may in fact bring further foreign investment to Honolulu.

Today’s picture was taken from a lot on Portlock and it is looking toward Hanauma Bay.

View from Portlock toward Hanauma Bay

Spoken by Keahi Pelayo | Discussion: No Comments »

View Of Honolulu From Portlock

October 24th, 2008 categories: Views of Honolulu

I had a chance to visit a fabulous nearly 30,000 square foot ocean front lot in the Portlock area. This picture was taken on the ocean side of the lot looking back at Honolulu.