COVID-19 is reshaping our economy. There's contrasting news because millions of Americans are losing their jobs, but yet the stock market is rallying. In terms of real estate, there are a lot of uncertainties. However, as we worked our way through this pandemic, we do know the following...
The Honolulu Board of Realtors recently released April's housing statistics. The median sale price for single-family homes and condos both went up, while closed sales for both went down over 20%. In addition, new home and condo listings were down 40%. Apparently this has been a trend in other cities across the nation too.
Do you remember the 2008 housing crisis? Some experts think the COVID-economy could be just as bad. What's interesting is Oahu real estate was barely affected during the housing crisis. Oahu real estate prices did not drop significantly because some people view Hawaii as a "safe" place to live and invest.
Although you may disagree with how our elected officials are handling the COVID-19 pandemic, one positive statistic is Hawaii has less cases than other states and cities. Out of state investors could view this as a selling point; they could buy a "pandemic house" in Hawaii.
Since we're an island, we only have so much buildable space. Due to the lack of housing inventory, prices tend to appreciate over the longterm. This is one of main reasons why people like owing real estate in Hawaii.
Despite the everyday chaos, there are people who are buying real estate. During the 2008 housing crisis, people said we would never see rates that low again. Well, that's not true. A handful of my clients recently re-financed. Most of them locked in rates in the low 3% range, while a few were able to lock rates in the 2% range.
If you're interested in buying, it's critical that you evaluate your employment situation. Hawaii's unemployment rate is upwards of 35%. If you feel confident in your situation, there should be less competition since we have a fearful buyer pool.
If you're looking to sell, you have to analyze your competition. You could increase your chances of selling if your home is unique compared to the other listings on the market. Although prices did increase in April 2020, there is still a risk that your home might sit.
Stay safe and healthy. We are in this together.