LIHU‘E — Single-family home sales on Kaua‘i moved at a molasses-like pace in the first quarter of the calendar year, as evidenced by a more than 55 percent drop in transactions when compared with the same period a year ago.
And with long-term interest rates firmly parked above 6 percent, odds of home sales picking up are dodgy at best given the cost to finance a home purchase has jumped considerably in the past year.
A total of 67 homes were sold in the three-month period ended March 31, 2023, compared with 151 in the three-month period ended March 31, 2022, according to monthly data pooled from multiple sources by Hawai‘i Realtors in Honolulu. That marked a decrease of 55.63 percent.
At the same time, the median price of a single-family home dropped 16.67 percent to $1,000,000 from $1,200,000.
“More of the same,” said Jimmy Johnson, broker in charge at RE/MAX Kaua‘i, on the housing market. “No real price change or affordability.”
The condominium market was a little busier with a total of 88 sold in the three-month period ended March 31, 2023, compared with 122 in the three-month period ended March 31, 2022. That marked a decrease of 27.87 percent.
Buyers also paid more despite picking up fewer condos, as the median price climbed 11.56 percent to $661,000 from $592,500.
Rough start
Single-family home sales started off the year on a rocky note, sinking 69.23 percent in January and 45.45 percent in February. Total home sales in March landed somewhat in between, down 52.73 percent.
The condo market was less temperamental, with sales off 7.69 percent in January, before plunging 45.45 percent in February. Total condo sales in March dropped 25.00 percent.
Looking ahead, there isn’t much to suggest the housing market will rebound in the months ahead given its state of malaise. And, the cost to finance a home purchase isn’t likely to get cheaper given the status of long-term mortgage interest rates.
The 30-year, fixed-rate mortgage inched up to 6.43 percent in the week ended Thursday, April 27, from 6.39 percent in the week ended Thursday, April 20, according to data from Freddie Mac, the mortgage giant. The most recent rate was also up more than 1 percentage point from the same period a year earlier, when it measured 5.10 percent.
On the bright side, it appears the national housing market has found itself on more suitable footing, which could help keep mortgage rates in check.
“Incoming data suggest the housing market has stabilized from a sales and house price perspective,” said Sam Khater, chief economist of Freddie Mac, in a statement that accompanied mortgage rate data. “The prospect of lower mortgage rates for the remainder of the year should be welcome news to borrowers who are looking to purchase a home.”
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Wyatt Haupt Jr., editor, can be reached at 808-245-0457 or whaupt@thegardenisland.com.
