The Perfect Storm in Hawaii Real Estate
Prices Staying up, and the storm is coming...
This should be good news for The Hawaii Real Estate Market and indeed all the units that are on market right now. There is kind of a perfect storm at this time that is good for buyers and sellers because of these 3 things:
1- The interest rates are still low but will start rising because of bond rates (Basically after the US Gov. stops buying mortgage back securities, the free market will have to drive up the interest rate to bring in private investors) call me or email me for more info on this.
2- Inventory is still very small, we have less than 5 months of inventory in condos and homes and it is normally a sellers market under 6 months.(I am seeing bidding wars on the best priced condos and homes, while others that are too high are being left alone) This rewards people who are well informed on the market and the value of their unit. Even with the inventory small, there are some great homes out there for purchase.
3- Government incentives that will only extend through April 30th, 2010. This is the famous First Time buyer's credit, that has now been extended to people who want to buy a new home and have owned their current home for more than 5 years.
How does this help buyers and sellers at this point, doesn't someone have to lose for others to win?
....NO, right now buyers are seeing prices that have rolled back to 2006 or earlier, so they get a great price in a Hawaii home. Those who buy now can do so with a low interest rate and get the government incentives. By buying now you hedge your money against the coming inflation, remember, all things rise on inflation, so if you already have a home, it's value usually goes up at a similar rate to inflation.
Sellers can sell at or near their list price because there is very little inventory of competing properties. I have even seen bidding wars in areas where there is little or no inventory. This is good for sellers because they can demand a good price for a good home, I cannot stress the importance of being at or below market value in order to get a lot of activity on your home as soon as listed. If you don't have an offer in 2 weeks, you are likely above the market.....
Please email me if you do not understand how some of these dynamics function, we can sit down and I can explain it...