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July 2023 Email Update

The June median price for single-family homes was $1,050,000 (4.5% less than June 2022) and for condos was $470,000 (4.5% less than June 2022).  Demand continues to drop significantly prior with 30.5% fewer single-family homes selling and 24.9% fewer condos selling than in June 2022.  Fewer families are moving since they are unwilling to trade their current 2.5% mortgage rate on their existing home for a 7.0% mortgage rate on a new home.  17.1% fewer single-family home listings and 22% fewer condo listings were added to the market in June.  Total inventory has crept up further with 14.8% more single-family homes and 16.1% more condos available as property takes longer to sell in this high mortgage rate environment.

You can review more detailed current and past real estate market data on our website using the link below.

Monthly Statistics

The national median price for existing home sales posted its biggest year-to-year decline since December 2011.  The May 2023 median price was 3.1% lower than the previous year as rising mortgage rates have slowed the housing market.  Existing home prices have dropped year-to-year for the fourth straight month and were expected to be larger but more homeowners with low fixed mortgage rates are staying put keeping the supply of homes low.  Bidding wars still exist in certain locations.

The Wall Street Journal described in a recent article what Stott Property Management, LLC has seen over the past two months with some of its rentals.  Tenants are gaining the upper hand as the COVID fueled rent increases have faded.  Asking rents declined 0.6% in May compared to the same month one year ago resulting in the first decrease since 2008 other than a brief drop during the pandemic shutdowns in early 2020.  One landlord recently refused to negotiate when a tenant balked at an 11% rent increase resulting in an unnecessary vacancy.  The tenants noticed that the advertised rate was lower after they moved, and they would have stayed had they been offered that rent while they were still living there.  Stott Property Management, LLC has recommended keeping the rent that same when offering one-year lease extensions for many rental properties.  One owner asked after hearing the recommendation when Tim had recommended raising the rent three months earlier.  Tim mentioned the change in the market and cautioned that a vacancy would cost more than any potential rent increase would be.  Tim suggested only raising the asking rent if the tenant moved and the property became vacant.  Vacancy rates have risen 2.6% as tenants move back in with family or find roommates to share the expense.  The fall in asking rents follows the national median sales price decline of 1.7%, the largest yearly drop in eleven years.

The Hawaii Authority for Rapid Transportation started service on Skyline (the train service’s new name) on Friday, 6/30/2023, four years later and $5.5 billion more expensive than advertised in 2004 by then Mayor Mufi Hanneman.  The project confounded four mayors and was the nail in the coffin of Kirk Caldwell’s failed campaign for governor.  Tim and Tracey joined 71,000 others in riding the train system from rusted out Halawa stadium to Kapolei and back.  The views were inspiring and the absence of development around the stations was evident.  Most stations were blocks away from any shopping and restaurants.

Skyline 

HART’s woes with the rail project continue as an eminent domain dispute with Ward Village developer Howard Hughes Corp. proceeds to court and $100 million spent on moving utilities will go to waste since the rail will end before reaching that area.
 
Construction began on a new affordable rental housing tower after a three-year delay.  The original plan called for three towers near the Halawa rail station and was rejected by the neighborhood board for the same reasons other boards reject the housing.  The project included too many units and too little off-street parking.  For some reason, council members can’t fathom that people with lower income still need cars to get to work.  The revised project calling for only two towers and more parking was approved by the neighborhood board last year.  The tower is scheduled to be ready for residents in the summer of 2025 with monthly rents projected to be as low as $493 for a studio and $1,418 for a four-bedroom unit.
 
Mayor Rick Blangiardi signed the fiscal year 2024 budget totaling $3.41 billion, a 2.7% increase over the previous year focusing on affordable housing and public safety.  The budget includes a $350 property tax rebate for all property owners that have a homestead exemption.
 
The Honolulu City Council approved a reduction in property tax rates for Residential A properties from $4.5 per $1,000 of value to $4 per $1,000 of value, saving property owners who have not filed for a residential property tax exemption $500 per year in taxes.
 
The City and County of Honolulu reopened its rent and utility relief program to 2,000 applicants on June 13th and closed the site just two hours later after reaching capacity.  The program is being funded by $25 million in state and city recovery funds.
 
The state Department of Health approved the Joint Task Force-Red Hill defueling plan which will take place with the following steps.

  1. Repairs to Red Hill facility and pipelines.
  2. Operational plan to drain surge tanks at Joint Base Pearl Harbor-Hickam (separate of Red Hill Fuel Tanks).
  3. Fill repaired pipeline with fuel to prepare for tank draining.
  4. Operational plan to drain main Red Hill tanks and tank bottoms.
  5. Removal of fuel from pipelines using gravity drainage.
  6. The operation plan to remove the final 100,000 to 400,000 gallons of fuel remaining in pipelines and surge tanks following gravity drainage.

 
The Honolulu Planning Commission reviewed the city’s request for a two-year extension to find a replacement site for the Waimanalo Gulch Sanitary Landfill in Kapolei.  The city is focusing its search for a new landfill on federally owned property under purview of the military.  Development costs for the new site are expected to range between $60 million and $80 million.

Kamaaina, Hawaii residents, will now be able to visit Hanauma Bay Nature preserve from 6:45 am to 1:30 pm without having a walk-in ticket or making an online reservation.  The previous rule allowed residents to visit the park without a ticket or on-line reservation until 9:00 am.  Active-duty military still get free admission with ID but must make an on-line reservation.

Hanauma Bay Oahu Hawaii | 4K Drone Video

U.S. Marines stationed at Kaneohe Marine Corps Base are cleared to operate their new Reaper drones, MQ-9A remotely piloted aircraft, and received its first two Reapers in April.  The new drones replace the RQ-21A Blackjack drones the Marines previously used and can fly much higher, for longer distances, and can be refueled in the air by tanker planes.  The Marines are transitioning from desert warfare and returning to their Naval roots with an emphasis of island and coastal operations.  Marines train to disrupt supply lines and use missile batteries to attach enemy ships with an emphasis on the South China Sea.

Kilauea started erupting again June 7th drawing large crowds to witness thirteen-to-thirty-foot lava geysers that added thirty feet to Halemaumau’s crater floor.  The eruption is currently contained in Halemaumau crater and provides no threat to surrounding neighborhoods.  The brief eruption paused on June 20th.

KÄ«lauea eruption overflight video - June 7, 2023

Arizona State University is dedicating $25 million to build a new facility in Kailua-Kona (on the Big Island) to house 300,000 coral colonies and help restore a 120-mile stretch of coral reef on the western side of the Big Island.  The new facility will have the capacity to grow one million coral colonies per year.  Scientists from Asner labs created detailed maps of nearshore coral reefs of the main Hawaiian Islands taking pictures with a laser-guided imaging spectroscopy camera to a depth of fifty feet.  The study documented vast areas of coral decline and degradation from overfishing and rising ocean temperatures.  Hawaii reefs have lost over two-thirds of their reef fish over the past fifteen years.

The state is partnering with a Big Island company to establish a 2.5-acre sandlewood seed orchard as an effort to restore native forests across the island chain.  Sandlewood is considered a hemiparasitic plant because it pulls some of its water and nutrients from adjacent “host” trees.  Iliahi (sandlewood in Hawaiian) was highly sought after for its fragrant wood and oil and its nuts were an important food source for Hawaiians.  The oil was used for waterproofing, to treat skin ailments, and making tools and crafts.  The company started with 3,900 sandal wood on another 3,000 acres of land and has grown the nursery to over 150,000 trees.  The company, Haloa Aina, has orders for 160,000 seedlings this year.

Kaena Point Natural Area Reserve celebrated its 40th anniversary with a thriving albatross colony.  An estimated 30,000 seabirds’ nest in the reserve and ninety-eight albatrosses had nests this year.  No seabirds nested in the area 40 years ago when the reserve was created, and the number of nests returned as vegetation returned.  The area is the only protected place in the world where the public can walk un-escorted on a trail next to nesting albatrosses.

Honolulu entrepreneur and fellow Hawaii tennis player, Tom Park, and his partner, Justin Park (unrelated), visited Chicago to collect the James Beard award for Outstanding Bar in early June.  The Parks started the bar, Bar Leather Apron, seven years ago in Downtown Honolulu.  The 25-seat bar serves custom cocktails and has an extensive collection of fine whiskeys.  The website is provided below.

Bar Leather Apron

Kailua based Lanikai Brewery is expanding its operations on Oahu through a crowd-funding initiative to open tasting rooms and restaurants in Haleiwa, Hilo, and another unnamed location on a neighbor island.  The fundraising campaign ends July 9th and the minimum investment for a share of the company is $250.  The company hopes to raise $1 million through the campaign.  Lanikai Brewery currently delivers beer to 332 sites around the country.  The website is provided below:

Lanikai Brewing | Become An Owner

Tim and Tracey watched Kailua’s Fourth of July parade as it returned from its three-year absence.  Here are some pictures of the event.

Tim & Tracey's Fourth of July 

Take a look at our Another Day in Paradise's Video

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