Archive for the 'Rants & Riffs' Category
Bernanke’s Attitude Pointing To Buying Honolulu Real Estate
February 10th, 2010 categories: Rants & Riffs, The Market
The New York Times online is reporting that Fed Chair Ben Bernanke is looking for ways to slow the economy.
“Increasing that interest rate, he said, will have the effect of pushing up other short-term interest rates, including the benchmark fed funds rate – the rate at which banks lend to each overnight.
It is even possible, Mr. Bernanke said, that the Fed “could for a time use the interest rate paid on reserves, in combination with targets for reserve quantities,” to communicate its policy stance to the markets. Since 1994, the fed funds rate has been the much-watched centerpiece of statements by the Federal Open Market Committee, the Fed’s key policy-making arm.” CLICK HERE TO READ THE NEW YORK TIMES ARTICLE
Why would Ben want to slow the economy? Could it be that he sees the “I” word on the horizon? I believe he is concerned about inflation. If inflation kicks in you may want to put your money into assets that appreciate. Real property is a terrific place to consider.
More specifically, you may want to consider buying a Honolulu home or condo as a rental property. Here are the potential benefits.
1. It gives you a hedge against inflation.
2. There is a very limited supply of developable land and, therefore, the lack of possible new housing in core Honolulu means our market is less susceptible to significant value drops.
3. Demand for housing in Honolulu’s core has never been met. Things that slow our market are lack of financing, high prices and fear (the first Iraq war & last year’s financial upheaval as examples).
4. If you are sitting on cash, after the cost of managing and maintaining a rental property you may receive a better return on investment that you could receive from putting your money in the bank.
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.
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Real Estate Underdog Fighting For All Of Us!
February 8th, 2010 categories: Rants & Riffs
Your right to own and control your property is one of the key constitutional rights that the founders of the United States wanted to assure through the constitution.
Since I am in real estate everyday, I see how our property rights are constantly challenged by governmental agencies a the necessity for them to approve of the things that we do with our land. The Maui News is reporting that a landowner on the Valley Isle has had enough and is challenging the County of Maui’s twice denying him a water meter for his 2.2-acre lot.
“Through his attorney, James Fosbinder, Davis is asserting constitutional claims of uncompensated taking and violation of equal protection and due process. The claims attack the validity of the Upcountry water meter waiting list and, potentially, East Maui Irrigation Co.’s access to water for Hawaiian Commercial & Sugar Co.” CLICK HERE TO READ THE ENTIRE MAUI NEW ARTICLE
Mr. Fosbinder deserves our support and prayers because should he win this suit, a blow will have be struck against the tide of regulation that has been slowly eroding our property rights.
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.
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The Kooks Are Targeting Real Estate For Tax Increases!
February 8th, 2010 categories: Rants & Riffs, The Market
Every January Honolulu taxpayers should be very concerned because the Hawaii State Legislature goes into session. If you have been watching the news you might be aware that all levels of Government are experiencing revenue short falls. Rather than curbing spending, the majority of our elected officials are marching lockstep toward raising taxes to cure the problem they created. Today’s Pacific Business News is reporting that representative Rida Cabanilla is proposing to levy a new tax of 1% of any commercial or residential property sale.
“The proposed tax, which would take effect July 1 and sunset after five years, would be on the gross proceeds of a sale, minus a real estate salesperson’s commission and conveyance tax, and would apply to both commercial and residential properties.” CLICK HERE TO READ THE ENTIRE PACIFIC BUSINESS NEWS ARTICLE.
I am not going to bore you with all of the reasons that this proposal is bad for real estate and the Hawaiian economy. Unfortunately, Hawaii’s governmental officials are blind to the idea that they need to decrease spending first. Then they need to reduce taxes so those of us that work at expanding the economy and jobs, can help to grow the state out of economic doldrums. Think about it.
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.
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Capital Gains Tax Going Up?
February 3rd, 2010 categories: Rants & Riffs, The Market
I have been selling real estate for 27 years and it seems the general trajectory for long-term capital gains taxes has been down. In 1983, when I started in real estate, I recall a capital gains rate of 48%! According to the Wall Street Journal, the President’s new budget is proposing an increase.
“Under the budget plan, capital gains and dividends would be taxed at 20%, up from 15% now, for people at those income levels.” CLICK HERE TO READ THE WALL STREET JOURNAL ARTICLE
What impact could this have on Honolulu real estate?
1. People will be more likely to hang onto their investment properties. Believe me, for investors, the capital gains tax is a serious consideration and some will decide not to sell. This could lead to lower inventory in our market.
2. Investors will sell and complete IRC Section 1031 Tax Deferred Exchanges. An exchange allows a seller to sell and buy another property while deferring any capital gains tax they may have been due under a normal sale.
3. If the State of Hawaii proportionally increases their capital gains tax, then the overall tax burden will be even greater and the disincentive for investors to sell will increase.
Here is my editorial comment, I don’t see how raising taxes in any manner is going to improve the economy. If anything, the Feds should be looking at decreases in taxes to spur the private sector creation of jobs and opportunity.
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.
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Yahoo! Honolulu Real Estate Market Is Smoking!
February 3rd, 2010 categories: Rants & Riffs, The Market
The Honolulu Advertiser and Pacific Business News are both reporting really good news.
“O’ahu’s housing market started the year on a positive note, as the median price of previously owned single-family homes sold in January jumped 10.8 percent to $597,500 from $539,500 a year earlier.” CLICK HERE TO READ THE HONOLULU ADVERTISER ARTICLE
“January’s sales numbers for both single-family homes and condominiums are very encouraging for the Oahu real estate market,” said board President Brian Benton. “Competitive pricing, current inventory levels, and the extension of the federal tax credit seem to be turning house hunters into first-time home buyers.” CLICK HERE TO READ THE PACIFIC BUSINESS NEWS ARTICLE
Here are a few questions. How long will the Honolulu real estate market remain strong? Why isn’t it stronger? Could buyers be missing the boat on low prices? Think about it.
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.
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Southern CA Market Good For Honolulu Real Estate
February 1st, 2010 categories: Rants & Riffs, The Market
The link between tourism, real estate in Honolulu and Southern California is very strong. That’s why I was encouraged to read in the Los Angeles Times that their real estate market is getting better.
“Rock-bottom interest rates and stronger sales in higher-priced neighborhoods helped Southern California’s housing market post robust gains in the typically sleepy month of December, new data show, and experts say the momentum is continuing — ushering in an early start to the spring home-buying season.” CLICK HERE TO READ THE LOS ANGELES TIMES ARTICLE
Let’s root for a strong turn in their market; it will be really good for Honolulu and the rest of Hawaii.
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.
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BusinessWeek Says Pearl City One Of Fastest Growing Cities!
February 1st, 2010 categories: Neighborhoods, Rants & Riffs
BusinessWeek ranked the top 50 fastest growing cities in the US and Honolulu’s Pearl City made the list! CLICK HERE TO READ THE BUSINESSWEEK ARTICLE.
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.
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Direction of Honolulu Real Estate Foreclosures…Up or Down?
January 28th, 2010 categories: Rants & Riffs, The Market
Which headline concerning foreclosures in Honolulu is correct?
Foreclosures running high-Honolulu Star Bulletin
Honolulu ranks lower in foreclosures-Pacific Business News
Here is what the Star Bulletin reported.
“Although Honolulu finished 2009 with fewer foreclosures per household than the national average, the city’s foreclosure activity increased at more than six times the national pace over the last 12 months and is expected to worsen this year.” CLICK HERE TO READ THE ARTICLE.
Here is what Pacific Business News reported.
“Despite a surge in foreclosures in 2009, Honolulu’s foreclosure rate ranked 128th out of 203 of the nation’s largest metropolitan areas, according to new statistics from RealtyTrac.” CLICK HERE TO READ THE ARTICLE.
Which paper is right? Read both articles and you can see how they are both right. The one you agree with may be an indication of your mental outlook. If you agree with PBN, then you may have an optimistic view of the future. It is the other, the opposite might be true.
SEARCH FOR YOUR HONOLULU 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.
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Honolulu Real Estate Part Of National Momentum
January 28th, 2010 categories: Rants & Riffs, The Market
I write this as I listen to our President’s State Of The Union Speech. As I have said in past months, Honolulu has been experiencing low levels of inventory and I wonder why the Honolulu real estate market isn’t stronger? Maybe strength is on the way! The Wall Street Journal reports the following.
“Inventories of homes listed for sale are down sharply across the U.S. and have reached very low levels in some areas, including Boston and Sacramento, Calif. The decrease in supplies has sparked a return of bidding wars on lower-end properties in some neighborhoods, but the national picture is mixed.” CLICK HERE TO READ THE WALL STREET JOURNAL ARTICLE.
Back to the speech, it sounds good, but it doesn’t square with what has been happening in the last year. Government is not the answer! I challenge any of you that are reading this post to think of something that the Federal Government is doing with a high level of excellence (outside of the military and law enforcement). Why would we give anyone that has not been doing a good job more to do? I believe in the people of the United States. We need to get Government out of the way and turn the energy and effort of our citizenry to work to get us out of the financial mess we now find ourselves in.
What does this have to do with momentum in the real estate market? I believe that the market is not stronger because of the unknowns that have been injected into the economy by the President. If he would just stop yapping (he has given more than 400 speeches in his first year in office), maybe we would start feeling some certainty in our markets and economy. As we gain confidence, so will the market. Think about it.
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.
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Proposed Tax Increase To Hit Many Honolulu Home Sellers!
January 14th, 2010 categories: For Sellers, Rants & Riffs, The Market
Today’s Honolulu Star Bulletin is reporting that one of our State Legislators is proposing a tax increase on “high-priced homes”.
“Rep. Rida Cabanilla, the House housing chairwoman, said she would propose a hike in the conveyance tax on homes priced more than $600,000, as one of the options for addressing homelessness.”CLICK HERE TO READ THE HONOLULU STAR BULLETIN ARTICLE.
Given that the median price of a house on Oahu has been bouncing between $550,000 and $600,000 for the last 6 months, I don’t understand why Ms. Cabanilla would want to expose the vast majority of home sellers to her knew tax. Clearly, Honolulu homes in the market segment that she is targeting are not luxurious by any means. Since her proposed tax would be assessed at the sale of a property, this penalizes sellers that should not necessarily be viewed as being the wealthy (not that I think it is right to tax the wealthy). In fact, if a person purchased their home 20 or more years ago, it could easily be worth more than $600,000. During these slow economic times, we don’t need to place any further tax burden on the Hawaii real estate market. If you would like to let the Representative know your thoughts, feel free to contact her using the information below.
Representative Rida Cabanilla
42nd Representative District
Hawaii State Capitol, Room 442
415 South Beretania Street
Honolulu, HI 96813
phone 808-586-6080; fax 808-586-6081
E-mail repcabanilla@Capitol.hawaii.gov
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.
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