The current median home sale price, $775,200, is down from 16.3% to 8.3% within a month. Also, homes have been sitting on the market for 80 days. All this indicates that Hawaii’s real estate market is slightly less competitive.
Additionally, only 1,035 homes were sold in June 2024, down from 1,210 in the previous year. Sellers are receiving fewer offers. This decline suggests sellers are receiving fewer offers, mainly due to the recent NAR settlement. Concerns about selling prices and agent compensation have contributed to this market sluggishness.
The NAR settlement has removed the buyers’ agent compensation from the MLS. This may drive down home prices further. As a result, buyers will have improved affordability along with low mortgage rates.
Here are some tips for you to sustain in the market:
- If You Are a Home Buyer: With an inventory of 6K properties and the potential for further price drops, now is a good time to buy your new home. The low interest rates at 6.25%-6.90% are also in your favor. Consider negotiating for seller concessions to further benefit from the purchase.
- If You Are a Home Seller: The correction in home prices is long overdue. In the wake of the NAR settlement, home prices may drop a little more. If you’re a seller, you can still make profits on home sales before prices potentially drop.
So, How Is the Real Estate Market in Hawaii?
Balanced! The number of homes for sale increased in June 2024 by 29.4% compared to the previous year. This is the 8th consecutive month the housing market has witnessed such growth. Single-family homes for sale are up by 8.1% and condos are up by 0.5%.
- Median Days on Market: The median days on the market for homes for sale are 80 days, up by 17 days YoY. This trend suggests a cooling demand in the Hawaii real estate market.
- Housing Inventory and Supply: As a buyer, you have more options now as the housing inventory is up by 40.1%. There are 6K homes for sale in Hawaii with an average supply of 7 months.
- Average Home Prices: The average median home price in Hawaii is $775,200. But, it is expected to decrease due to a rise in inventory in the latter half of 2024. The sale-to-list price ratio is at 98.0%, with a decline of 0.78 pt YoY.
- Home Sales: As per June 2024 data, home sales decreased by 14% YoY! Only 951 homes were sold, compared to 1,210 last year.
- Average Rent Prices: Rental costs vary statewide. An average tenant in Honolulu pays $2,138, while the one living in Oahu pays $2,522. You should check the rent rates in your region.
Why Is Hawaii a Buyer’s Market Now?
Buyers have more housing inventory to explore. The additional housing supply can balance the Hawaii real estate market and stabilize home prices in check. Let’s look at some more facts:
- More Days on the Market: Homes are spending more days on the market. This is visible in metro cities like Honululu, Kailua, and Hauula where the average days on market is between 47 to 78 days.
- Low Housing Demand: The demand in Honululu is low with only 258 homes sold in June, down from 359 last year. Similarly, only 29 homes were sold in Kailua, up from 28 last year.
- More Homes Have Price Drops: In June 18.0% of homes experienced price drops, compared to 14.2% last year. This trend indicates a gradual shift toward a buyer’s market.
- Low Mortgage Rates: Mortgage rates remain near historic lows, ranging between 6.25%-6.90%. So, this is a great time to lock in a low rate and get pre-approved for a mortgage now.
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Hawaii Housing Market Predictions 2024
Here are the predictions for Hawaii’s housing market in the remaining months of 2024 and 2025:
- Number of Home Buyers Will Increase: As inventory grows and homes stay on the market, more home shoppers are expected to re-enter the market.
- Interest Rates are Expected to Drop: Mortgage rates hit 6.34% in July, 2024. NAR predicts the average interest rate will drop to 6.3% by year-end. This will encourage more buyers to apply for loans.
- Home Prices Will Drop: After a period of sluggish growth, home prices are expected to begin a gradual decline.
- iBuyers Will Continue to Make Lowball Offers: iBuyers like Opendoor and Offerpad, which once offered 104.1% of market value in 2021, now offer around 70%. Such lowball offers to sellers will increase opportunities for individual buyers.
Bonus Predictions: Buyer Broker Commissions Will Be Zero!
In a shocking turn of events, the NAR settlement has completely eliminated buyer agent fees from the MLS. Let’s understand its impact:
- Buyer Agents Will Be Affected: With buyers now responsible for directly paying their agents, many may choose to find their homes on their own. This may very soon render buyer agents obsolete.
- Seller Concession Will Increase: Without the obligation to pay buyer agent commissions, sellers might see increased requests for seller concessions and offline transactions. Additionally, builders are offering significant concessions to attract buyers, further influencing the market dynamics.
- Builders Will Compete More: Home builders are persuading buyers to buy new construction homes with mortgage buydowns worth $30K!
- Sellers May Offer Fees for Services: Sellers may offer at least 1%-2% fees to the buyer agents in order to sell their homes quickly. Increasing competition from builders may also cause sellers to pay extra fees to buyer agents.
Curious what the NAR lawsuit is about?
Check out our video to find out why NAR chose to settle and eliminate the buyer-broker compensation rule.
Is the housing Market in Hawaii Going to Crash
A housing market crash in Hawaii is unlikely. Hawaii home values have been up by about 8.3% YoY. Both local and international buyers are actively pursuing property ownership in this tropical locale, often resulting in competitive bidding.
Hawaii listed as the 17th best state to live in the US. Well-liked tourist locations with thriving vacation rental markets are Maui, Oahu, and Honolulu. So, it is unlikely that Hawaii’s housing market would crash anytime soon.
If you are looking for a home in the Aloha State, find your dream house here.
2024: Is It a Buyers’ or Sellers’ Market Now?
The housing market is expected to lean more in favor of the buyers in the latter half of 2024. Home prices are decreasing, and the number of homes for sale (6K) has increased by 29% year over year. Buyers now have more choices.
With mortgage rates around 5.84%, buyers have more purchasing power, and more homeowners are likely to list properties on Hawaii MLS. The 27.2% increase in new active home listings in Hawaii (currently at 1,343) has also brought back home shoppers. The properties for sale in Hawaii will increase.
So, whether you are looking for a condo in Honululuor a single-family primary home Kailua, you will find your dream home in upcoming months.
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Disclaimer: This article is for informational purposes only. It does not constitute an offer, solicitation of an offer, or any advice or recommendation. Houzeo doesn’t provide any legal or financial advice. The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Houzeo Corp., its affiliates, or its employees. However, the author does not make any representation or warranty, express or implied, as to the information’s accuracy or completeness, nor does the author recommend that the attached information serve as the basis of any investment decision.
Frequently Asked Questions About Hawaii Real Estate Market
When will the housing market crash in Hawaii?
Not for the next few years. Hawaii's housing market will not crash in 2024. Despite low housing demand and modest home prices, Hawaiians have managed to keep the market afloat.
What are the real estate housing market 2024 predictions for Hawaii?
2024 is a balanced market with 5-6 months of supply. Here's our forecast for Hawaii housing market in 2024 are: (1) Home buyers have returned to the market. (2) housing inventory will increase more (3) Property prices in Hawaii will increase marginally (4) Buyer agent commissions will be zero!
Is it a good time to buy a house in Hawaii?
Yes! Currently, the homes for sale are at around 6K which is up by 29.4% YoY. Low home prices and low mortgage payments have made the home buying affordable. More buyers will return in the second half of 2024, so we'd recommend you to buy a house now.
Is it a good time to sell a house in Hawaii?
If you want to sell a house in Hawaii now, you have to be very quick to list before the home prices drop. You can find out your home's market value with home worth calculator. It helps to know if the property prices in your area.
