[x_section style=”margin: 0px 0px 0px 0px; padding: 45px 0px 45px 0px; “][x_row inner_container=”true” marginless_columns=”false” bg_color=”” style=”margin: 0px auto 0px auto; padding: 0px 0px 0px 0px; “][x_column bg_color=”” type=”1/1″ style=”padding: 0px 0px 0px 0px; “][x_text]2015 marked the fourth consecutive year of price appreciation for residential real estate Statewide, with Oahu reaching record levels for single family median sales prices. Neighbor islands are recovering, with prices about halfway between 2006 highs and 2011 lows. Commercial real estate has also seen improvements with higher rental rates and lower vacancies overall.
Residential
In 2015, 79% of Oahu’s neighborhoods had a positive change in median price over 2014, with 40% of them having double digit price appreciation. 1 in every 4 single family homes and 1 in every 5 condominiums are selling above the list price. The price range of a property will determine how to act in 2016 as affordability becomes a restricting factor and fewer can purchase the higher priced homes.
Here is my opinion with regard to residential housing in 2016:
☻ Buyers- “Competition is fierce under $1M and more cautions above $2M”.
☻ Sellers- “Not just anything will sell. Be smart about pricing and presentation.”
☻ Builders- “It’s a good time to sell your inventory.”
☻ Investors- “Think about a long-term hold.”
Commercial
Commercial real estate continues to improve overall. The industrial sector is performing well with a slightly lower vacancy rate of 2%, and increasing rents of roughly $1.16 in Honolulu. The retail market remains active with a low vacancy rate of 4.6% and asking rents as high as $6+ psf. The low vacancy in regional retail centers and the addition of Ala Moana’s new Ewa wing were the talk of the town. The office market continues to progress but is being held back by greater office space efficiency and the cost of construction for tenant improvements. Multi-family apartments are still in high demand.
Here are a few thoughts on commercial real estate in 2016:
☻ Landlords- “Do your best to retain good tenants.”
☻ Tenants- “Be aware of higher CAM and construction costs.”
☻ Investors- “Look for quality investments for the long-term.”
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