Is the luxury housing market slowing down? The Honolulu Board of REALTORS® recently released January’s Local Market Update. As I was reading this report, I noticed a few things.
In the Kapahulu – Diamond Head region, there was a 44% decrease in closed sales and a 10% decrease in the median sales price (single-family homes) from the same time last year.
In addition, within the Waialae – Kahala region, there was a 30% decrease in closed sales and a 7% decrease in the median sales price from the same time last year.
The development of Kakaako has created an influx of luxury condos. It seems like the increase in supply has made it difficult for Sellers to offload their luxury homes. More so, the influx of new luxury condos has slowed the appreciation of some luxury condos.
Scrolling through the MLS, two penthouse units at Koolani sold within the past 180 days. Penthouse Unit 2 sold for $2,136,000. This was $352,000 below the original asking price. In addition, Penthouse Unit 6 sold for $2,300,000. This was $350,000 below the original asking price.
There are four active Koolani penthouse listings. The median list price is $2,285,000, with a low of $1,890,000 and a high of $3,500,000.
At Keola Lai, the 3-bedroom units have been hit-or-miss. There are currently three active 3-bedroom listings on the market. The median list price is $1,049,000, with a low of $990,000 and a high of $1,150,000.
In 2016, only one 3-bedroom unit sold for $1,150,000. To put things into perspective, the owner who sold his unit in 2016, purchased the unit in 2008, from the developer, for $1,030,000. In other words, this is only $19,000 less than the current median list price for the active 3-bedroom units currently on the market.
Has the luxury housing market reached it peak? It'll be interesting to see where 2017 takes us.