Hawaii Real Estate: Buyer’s or Seller’s Market?
If you’re interested in Hawaii real estate, it’s essential to understand buyer’s and seller’s markets. These real estate trends impact everything from the price homes sell for to the way people negotiate sales. Since the Hawaii real estate market is constantly shifting, it never sticks with one trend for a very long time. Keep reading to see whether industry experts think Hawaii is in a buyer’s or seller’s market right now.
What Are Buyer’s and Seller’s Markets?
In the Hawaii real estate world, buyer’s and seller’s markets refer to two common market conditions. A buyer’s market occurs when the supply of homes outweighs the demand for homes. In a buyer’s market, homes stay on the market for a longer amount of time and sell for less money. Buyers can make more demands and have more available choices, so it’s called a buyer’s market.
Meanwhile, a seller’s market happens when the demand for homes is higher than the supply for homes. Sellers have a lot of interested buyers, so this market works well for them. They can list their homes for higher prices and can close deals faster. In a seller’s market, there is often a higher volume of real estate transactions because a lot of buyers are competing for homes while sellers rush to sell their houses for a high price.
Is the Hawaii Real Estate Market a Buyer’s or Seller’s Market?
After a few years with a seller’s market, Hawaii’s real estate market is currently leaning towards being a buyer’s market. Several factors are starting to result in less buyer demand. Rising interest rates and inflation mean that many people can no longer easily afford to buy a home. Furthermore, the end of COVID-era safety measures means that fewer people are stuck at home and interested in upsizing to a new property.
The Hawaii Statewide Real Estate Report from Locations.com shows how the declining interest is affecting sales. Overall, there were 233 fewer finalized Hawaii house sales in February 2023. The median sale price has dropped from $950,000 in 2022 to 875,000 in 2023. Furthermore, houses are now sitting on the market for an average of 48 days instead of 17.
All of this sales data creates a buyer’s market for the state of Hawaii. Though there are still a lot of sellers trying to list properties, there are fewer buyers available. This leads to buyers taking more time as they shop around and negotiate for the perfect deal.
Different Parts of Hawaii Are Following Different Trends
Keep in mind that Hawaii real estate is unique. Every part of the state doesn’t follow the same trends. Instead, different neighborhoods and islands have drastically different markets. For example, Ewa Beach currently has a high housing inventory and a reduced amount of demand, so it’s in a buyer’s market. Other regions that are buyer’s markets include Lahaina, Hauula, Koolauloa, and Haleiwa. However, Hawaii Kai still has a very low inventory with a lot of demand, so it is in a seller’s market. Kohala, Mililani, and Ewa are also examples of regions that are currently seller’s markets.
For the most part, whether or not a neighborhood is in a buyer’s or seller’s market depends on how desirable it is. Quieter suburbs with older homes and less proximity to tourist destinations are in buyer’s markets. Meanwhile, regions near city centers and tourist attractions still have robust seller’s markets. Denser regions with a high population and limited amount of space often tend to be seller’s markets.
How to Find a Strategy That Fits Your Real Estate Market
Ultimately, understanding how buyer’s and seller’s markets work allows you to fine-tune your real estate strategy. The first thing you’ll need to do is consider the area you want to work in. Though most of Hawaii is in a buyer’s market, a few of the big cities and touristy areas are still a seller’s market.
Take a look at the number of listed homes and the average days on the market. If there are fewer finalized sales, lower prices, and listings that stay around for longer, you’re in a buyer’s market. Meanwhile, if your region has a lot of sales, very high prices, and listings that disappear in days, you’re in a seller’s market. Once you figure this out, you can adjust your strategy.
Buying Hawaii Real Estate in a Buyer’s Market
If you’re interested in buying Hawaii homes, now is the time! You have a lot of inventory to choose from, so you can hunt for your dream home. Another perk of being in a buyer’s market is that you can often make a lower offer or negotiate more contingencies without losing out on the house. Just make sure you aren’t getting too overconfident. Hawaii is still a very desirable place to live, and the market is only just starting to veer toward being a buyer’s market. You still need to offer a competitive price and act fast when you find a house you love.
Selling Hawaii Real Estate in a Buyer’s Market
Though you might need to put a little more effort into selling, being in a buyer’s market is no reason to give up. Instead, you just need to be patient and ensure you’re offering potential buyers a lot of value. Doing things like repairing a property or updating it with a fresh coat of paint can make it stand out from other competitors. You can also use modern marketing techniques to ensure as many potential buyers as possible see your Hawaii property.
Buying or Selling Hawaii Real Estate in a Seller’s Market
If you’re in one of the few Hawaii locations that’s still a seller’s market, expect things to move a lot faster. People who sell now can often ask for big prices and get away with skipping nonessential repairs. However, it’s still worth having a great agent because the right negotiation tactics can lead to an impressive closing price for you. If you’re thinking about buying a home in a seller’s market, it might be worth waiting a few months. Research suggests most of Hawaii will swing to a buyer’s market soon, so you might find better deals in the future.
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