In my most recent blog, “Hawaii Real Estate is on Fire!” Click Here, I talked about how the real estate market in Hawaii is just going crazy in terms of record-breaking median sales prices for single family homes, double digit multiple offers, high demand, and low inventory. Well, now I’m here to tell you that the information is true, in general and at a high level. However, Real Estate is LOCAL. So when you drill down into specific neighborhoods and specific price points, the story can totally change and not be exactly the same.
Let’s take for example the Region of Diamond Head. The median price for single family homes in Diamond Head for September 2020 was $1.15 Million, that’s a big difference from the $880,000 median price for Oahu for the same period. Although it’s higher, the supply demand dynamics are very different. Months supply of inventory for Diamond Head single family homes was 4.5 months vs 1.9 months for the entire island of Oahu. If you get even more granular, the difference is more evident and the statement that the Hawaii real estate market is HOT in September 2020 is very much a generalized statement.
For one of my sellers, I recently dug even deeper into the Diamond Head market to look at single family homes, above $1.3 million, 4 bedrooms or more, with 2000 to 2500 square feet of living space. The median sales price for this subgroup was $1.65M for September 2020. The months supply of inventory was 3.3 months, not too shabby for sellers, but relatively higher than the 1.9 months of inventory for the island. Days on market for Diamond Head was 95 days, and that is a really big difference compared to the 9 days on market island wide.
Source: Infosparks
Although these statistics are very different, you must consider that this Diamond Head submarket is very unique. As such you can’t just compare it to the island-wide statistics and say, “Oh, we’re in bad shape.” The next step as part of this analysis is to look at the trends for those numbers over time and try to see where we’re heading. In the case of median days on market, we see that 95 days on the graph is not an outlier at all but its actual right in the middle of this fluctuation between zero and 200 days.
Source: Infosparks
Now looking at months supply of inventory, we see 3.3 months is well within the range of the last 15 months of statistics and actually looks on the lower end of the range. That being said, home owners in this price range in Diamond Head should feel relatively confident that the supply and demand is in equilibrium and in their favor I’d say. However, they can’t expect their listing to go into escrow in 9 days. This is definitely a small niche market and they’re listing may sit for a while. Pricing it right will be important but regardless, it is a different animal than the single family homes in Central Oahu getting 22 offers after 4 days on market. It will probably take a little longer to sell, but if you get a good Realtor to help you price it right and market it properly, you can expect it to sell in a reasonable amount of time.
So, that’s the skinny on Diamond Head, greater than $1.3M submarket for September 2020, again VERY different from when you look at island-wide statistics. I hope you enjoyed it. Don’t forget to click the subscribe and bell buttons to get reminders of my weekly videos that come out every Monday.
Thanks for watching and in the words of the English Philosopher, Aldous Huxley, “There are things known and there are things unknown, and in between are the doors of perception.”
