January 2015 E-Mail Update
Here is our 1/14/15 E-Mail Update. It is sent after the statistics for the preceding month have been posted on the Board of Realtors Website. To be removed from the mailing list; send us an e-mail stating that. Please include your first and last name to make it easier for us to find you in our database.
Please use the following link to access our most recently published quarterly newsletter:
Oahu’s sellers market closed out 2014 on a strong note. The median price of a single family home was $690,000 in December, $5,000 higher than December 2013. The median price of a condo jumped close to 10% and eked out a new record of $361,250, eclipsing the previous record of $360,000 set in June. The number of sales in December for both single family homes and condos were essentially unchanged when compared to December 2013 figures. Inventory still remains tight with months of remaining inventory standing at 2.6 for single family homes and 3.0 for condos. A neutral market, one where neither buyer or seller is considered to have the upper negotiating hand, typically has 6.0 months of remaining inventory.
The Hawaiian goddess, Pele, continues to toy with the town of Pahoa like a cat with its prey. The lava flow from Kilauea resumed its slow march toward the town after the lowest portions of the lava flow stalled in November. Malama Market, Ace Hardware, and Lex Brodie’s Tire Company have moved their inventory from the Pahoa Marketplace stores to other stores on the Big Island and offered employees working at the Pahoa Marketplace positions at other locations. Some smaller businesses and franchises have also closed up shop ahead of the lava’s expected arrival. A majority of residents, on the other hand, plan on staying put until the lava reaches their property or the county orders them to move.
Hawaiian Airlines carried its 10 millionth passenger in December, the most passengers flown in a single year. Hawaiian Airlines has taken advantage of the closing of Aloha airlines and ATA during the last economic downturn by adding more flights and seats to and from Hawaii.
Hawaii produced 18% of its electricity from renewable sources, surpassing its interim goal of 15% by 2015. While reducing dependency on oil is a laudable goal, not all of the renewable sources are from solar panels or wind farms. Some of the electricity that Hawaii counts as renewable comes in the form of steam plants that burn garbage on Oahu and sugar cane waste on Maui.
State employers received some welcome news for 2015. The unemployment contribution rates for Hawaii employers will drop about 22% in 2015, saving employers about $100 per employee next year. Hawaii’s unemployment rate has dropped to 4.1% from 6.8% four years ago (9,700 new jobs were created in 2014). The state of Hawaii actually had to borrow about $183 million from the federal government to pay jobless benefits when the unemployment insurance trust fund went bankrupt in December 2010. The trust fund contained more than a half billion dollars in 2008 before being wiped out by a 19 month recession and the federal governments expansion of unemployment benefits in reaction to the “great recession.” The trust fund has currently grown to nearly $400 million, about 12 months of unemployment benefits.
In more good news, Hawaii has topped the United Health Foundation’s list of healthiest states for the second year in a row. Hawaii’s strengths include low obesity rates, low rates of preventable hospitalizations, and low rates of cancer deaths. Hawaii offers a fantastic climate for people to remain active outdoors all year long.
Hawaii was ranked as the fourth-worst state for small businesses according to the Small Business and Entrepreneurship Council’s Small Business Policy Index. “Most business owners (including this one) understand the array of costs and burdens imposed by the government,” the report says. “Taxes and regulations, for example, drain enterprises of vital resources, distort decision-making, and redirect resources and energies away from maintaining, improving and/or expanding a business.” This quote not only applies to traditional for-profit businesses located on Hawaii, it also applies to every real estate investor that owns property in the state.
The Honolulu Authority for Rapid Transportation recently put out its first bid for three rail stations after cancelling the initial bids for nine rail stations when the lowest bid came in over $110 million more than budgeted in August.
People driving along King Street are adjusting to a slower form of traffic. The City of Honolulu opened the first bike lane in Honolulu to mixed reviews and some confusion. Some motorists have been parking in the bike lane next to the parking meters that are located along the sidewalk versus the lane adjacent to the bike lane. City officials hope to eliminate the confusion before handing out $200 fines for parking in the bike lane. The fee was recently raised due to complaints of drivers parking in the Lanikai bike lane in Kailua.
The City and County of Honolulu announced plans to replace 52,000 city-owned streetlights with LED fixtures over the next four years. The LED lights reduce energy consumption by an average of 50 percent and have a payback period of four years. The City projects it will save approximately $3 million per year once the retrofit is complete. Something to think about doing in your own home.
The University of Hawaii recently submitted a budget proposal from 2015 to 2017 and asked for an additional $75 million to fund operations over the next two years. The University of Hawaii System typically receives approximately $400 million from the Legislature every year. The request for additional funds was made despite President David Lassner’s reluctance to raise the cost of tuition despite rising costs associated with utilities and facilities maintenance.
The Polynesian Cultural Center in Laie is nearing completion of a five-year redevelopment of the iconic tourist attraction on the North Shore. Two anchor stores for the new Hukilau Marketplace opened in December and other stores and vendors will start operations over the next few months. New bathrooms have been added that will be open to all travelers in the hopes of attracting more business to the shops and restaurants.
Wingstop has recently opened two franchises on Oahu with plans to open two restaurants on Oahu before expanding to the neighbor islands. In addition to chicken wings, Hawaii will have two sides that other Wingstop restaurants don’t offer – rice and macaroni salad.
Oahu is following the trend of craft beers with three new planned additions in 2015. Stewbum & Stonewall Brewing Company plans on opening for business in Kaneohe by selling kegs to local bars. Waikiki Brewing Company will be serving beer at Cheeseburger Waikiki on Kalakaua Avenue. Lanikai Brewing Company is building out its facility with plans to start as a brewery selling retail, offering beer tastings, and tours.
Lanikai Beach in Kailua recently made Harper’s Bazaar’s list of the world’s ten best beaches. The beach has become so popular over the past couple of years that drivers often have to wait in traffic for close to an hour to get out of the small neighborhood of Lanikai.
If you need assistance buying, selling, or managing Oahu property, we want to apply for the job of assisting you.
Hau’oli Makahiki Hou!
Tim & Tracey