Archive for April, 2009
Buy Honolulu Real Estate Versus Stocks?
April 16th, 2009 categories: For Buyers, The Market
For reasons expressed in earlier blog posts, I am a mid to long-term bull on Honolulu real estate as an investment (lack of supply, never met demand, jobs, education, etc). Until the recent financial debacle in the stock market, many people saw it as becoming a foolproof way to invest for the long-term. The closing of Enron and Aloha Airlines highlight that even with market declines the value of real estate in Hawaii has never gone to zero. In other words, the value of your investment in real estate could drop lower than the amount you paid, but could the sales price of that real estate go to zero? I think not.
Here’s the rub. Most people don’t pay cash for their home, so if property values drop below the amount owed by the owner of the property, and the owner wants to sell, then they have a problem. If the owner that is underwater does not have to sell, then there is a “paper” loss, but no real loss because it takes a sale to make the loss real. In Honolulu, if you are in this sort of negative equity position, and are not selling, your balance sheet and ego are taking a hit. But I am willing to bet that your home will be worth significantly more 10 years from now than it is today. I will make an even larger bet that your home will be worth a major fortune (in comparison to what you paid today) 20 years from now.
In summary, short-term, real estate values can go down and if you need short-term appreciation you could be a very unhappy investor in any market. However, over the long haul, in Honolulu, real estate values have risen. Do you wish you purchased more real estate in 1999, how about 1989 or 1979? Another way to fashion the same thought, if you invested in a property today, do you think it will be worth more in 2019 or 2029…get the point?
CLICK HERE TO SEARCH FOR YOUR NEW HOME
If you would like to discuss your real estate needs, feel free to call me at 808-737-2093 or toll free at 877-737-2093. You can email me at keahi@lava.net.
| Discussion: 3 Comments »
Repeal of Law Good for Honolulu Homeowners!
April 15th, 2009 categories: Rants & Riffs
Act 228 which passed in the last legislative session was a mess. It required that any owner of a home 50 years or older, provide the State with archival photos of their home before any construction permit was granted.
“The repeal of Act 228 ends what some historic preservationists described as a well-intended but poorly executed effort to document Hawai’i’s architectural history.”
CLICK HERE TO READ THE HNA ARTICLE
I knew a number of people that were attempting to get permits during the laws existence and it was adding at least 90 days to the permitting process. 90 days of additional interest, 90 days of lost marketing time, 90 wasted days! The repeal of the law will be good for Honolulu homeowners and the contracting business. Hip-hip-hooray!
CLICK HERE TO SEARCH FOR YOUR NEW HOME
If you would like to discuss your real estate needs, feel free to call me at 808-737-2093 or toll free at 877-737-2093. You can email me at keahi@lava.net.
| Discussion: 1 Comment »
Leverage Is Still Good!
April 14th, 2009 categories: For Buyers, Mortgages & Financing
One of the beauties of real estate is that you can use a few dollars to control a much larger number of dollars. For example, you buy a $300,000 FHA approved condominium and use a down payment of $9,000 (3%); you have just used $9,000 to control $300,000. This is called leverage. What is the magic of leverage?
Let’s say your $300,000 Honolulu condominium appreciated at an average of three percent (3%) per year for the next 10 years. The valuation of the unit would look something like this. Read the rest of this entry »
| Discussion: 1 Comment »
California Shift Bodes Well For Honolulu Real Estate
April 13th, 2009 categories: The Market
It is believed that the Honolulu real estate market lags California by six months to a year. If this is the case, then the news I have been hearing anecdotally could mean that our market could be firming sooner rather than later. My broker network in California has been telling me that sales have been brisk, prices have begun to rise and inventory is dropping. A recent article at Forbes.com further confirms this feedback.
“Statewide, existing home sales have jumped 30% over the past year, taking the inventory from an estimated 16.7 months to less than seven months.”
CLICK HERE TO READ THE ENTIRE FORBES ARTICLE
If you are a buyer, today’s interest rates and a market somewhat favorable to you may mean that the next few months may be good time for you to buy. Think about it.
CLICK HERE TO SEARCH FOR YOUR NEW HOME
If you would like to discuss your real estate needs, feel free to call me at 808-737-2093 or toll free at 877-737-2093. You can email me at keahi@lava.net.
| Discussion: 1 Comment »
Trillion New Billion?
April 10th, 2009 categories: Rants & Riffs
To me, it seems that our government has replaced a billion dollar allocation with a trillion dollars. I have been trying to get my arms around this concept. I heard one that said if you spent a million dollars every single day since Jesus was born, it would have taken until today to spend a trillion dollars. While surfing the net, I ran across a great illustration of a trillion dollars that paints a picture of just how much it is.
CLICK HERE TO SEE IT
| Discussion: 2 Comments »
Disclose, Disclose, Disclose in Honolulu Real Estate
April 9th, 2009 categories: For Sellers
Buyer beware? Not really, a recent Realtor Journal article walked through some very good guidelines Sellers and Broker/Agents should follow regarding disclosures concerning the background and condition of a home or condominium. Below is a modified version of the 8 rules advocated by the Realtor Journal. Read the rest of this entry »
| Discussion: 1 Comment »
Dropping Inventories Good For Real Estate?
April 8th, 2009 categories: The Market
The Honolulu Advertiser reported “Wholesalers cut their inventories in February by the steepest amount in more than 17 years”. This has to be good for the economy and as the economy improves the Honolulu real estate market should follow.
“The sixth straight monthly drop in wholesale inventories also can be viewed as positive in the long-term because once stockpiles have been adjusted for the economic slowdown, businesses may be able to increase orders for new goods. But in the short run, the reductions will lead to fewer orders and less production.”
CLICK HERE TO READ THE ENTIRE HNA ARTICLE
Call me an optimist, but it makes sense to me that as inventory drops manufacturers will need to build more stuff. In order to build more stuff, they will have to hire more people. As jobs are created and more stuff is built, then the economy should shift? Let’s all work toward making this happen.
CLICK HERE TO SEARCH FOR YOUR NEW HOME
If you would like to discuss your real estate needs, feel free to call me at 808-737-2093 or toll free at 877-737-2093. You can email me at keahi@lava.net.
| Discussion: 2 Comments »
Manoa Vintage Home For Sale!
April 7th, 2009 categories: For Buyers, Homes For Sale
If you follow my blog you know that I have a soft spot in my heart for vintage Honolulu houses. Many of my posts include pictures of homes that I see during my daily sojourns around town selling real estate. Most of them capture my imagination, but many of them are not available for sale. Today is different!
This home is listed by another broker and is offered at $850,000. It is located in the center of Manoa (very, very desirable area if you are not from Honolulu) and has many of the classic characteristics that mark a home as being special. Read the rest of this entry »
| Discussion: 1 Comment »
Honolulu Real Estate At A Bottom?
April 7th, 2009 categories: For Buyers, For Sellers, The Market
Brian S. Wesbury and Robert Stein posted an article at Forbes.com entitled, “The Recovery Begins”. Amidst the uncertainty and negativity that can be found in people and the markets, it is refreshing to find an optimistic view of the place in which we find ourselves. They make a very good case that the Federal Reserves’ recent monetary policy is beginning to work. Read the rest of this entry »
| Discussion: 2 Comments »
Downtown Honolulu From Dowsett Point
April 6th, 2009 categories: Rants & Riffs
Dowsett Point is a condominium that is walking distance from downtown Honolulu. Today’s picture was taken from the lanai of one of the mezzanine units. The unit offers nearly 180-degree views from Bishop Street to the Pali.
| Discussion: 2 Comments »
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