Hawaii Housing Market Crash or Are We In a Bubble?

Hawaii is the real estate market about to crash? If you're like most Americans today 
you may be asking that question,   is the real estate market about 
the crash or are we in a bubble? Aloha I'm Stephen Proski with Real Estate 
Kailua Kona and Corcoran Pacific Properties   welcome back to our YouTube channel If this is 
your first time here I would recommend that you   hit the subscribe button below because I am 
posting videos about the Kailua Kona area   each and every Thursday and i think 
you don't want to miss anything. So let's deal with the elephant in 
the room. Are we in a housing bubble   and is the market going to 
crash that's the big question.  So the housing market has been extremely 
strong over the past several years   fueled by low interest rates and a sizable 
number of Americans desire to purchase a home.   A contributing factor was the pandemic and the 
availability of people to work from their home Unlike in 2006 when the housing market   crashed there were many contributing factors 
to that situation that are not current today Nope in 2006 the real estate market was being 
overbuilt with new construction and it was so   so easy to obtain financing to purchase a home. 
If you could fog a mirror you probably could get   a mortgage back then, I'm telling you.

It was 
not the real estate market that caused the crash   in 2006 it was the mortgage industry funding 
risky loans with little to no down payments. Having been through that market 
myself I can honestly tell you   we are not in that same situation as back in 
2006. According to Lawrence Yun the National   Association of Realtors Chief Economist 
this is not a bubble and this isn't 2006. What's the difference between then and now?   "Lending" Yes credit remains tight and 
the lenders aren't issuing risky loans.   Today's market boils down to simple economic 
principles, principles of Supply and Demand.
  With a sharp increase of interest rates 
over the last six months coupled with   rising inflation this definitely has slowed 
our real estate market down here in Kailua Kona   and the rest of the country as well but 
it has not stopped our real estate market.

No, properties continue to sell and yes they 
may be sitting on the market a little bit   longer than six months ago but, they are still 
selling. Prices as we all know were rising   faster than anyone could anticipate because 
the demand was high and the inventory was low Again the basic economic principles of Supply 
and Demand. This is not the first time our real   estate market has gone through an adjustment 
and it's probably not going to be our last. The National Association of Realtors is still 
predicting price growth between 3 and 8 1/2   % in 2022 for the entire country. That's 
lower than last year's incredible growth   but, it's still growth. Yes Kailua Kona is a 
destination location and people still want to   live where everyone else gets to vacation Yes people still buy and sell real 
estate here on the Big Island.   It's still moving…..

We have little to no new 
construction and a limited supply of housing.   The medium sales price for a single family home 
in July 2021 was $900 000 and condo sales were   around $420,000 dollars on average. Median 
sale prices in July 2022 for single family   homes jumped up to 1.3 million dollars in 
Kona and condos rose to $515,000 dollars. Prices are climbing they're 
not dropping. In a few months   the mainland will be 
experiencing cold weather again,   thus bringing winter visitors back and more   than likely demand for housing 
in Kailua Kona will increase And what about our international buyers? 
We have not seen that population here   since the beginning of the pandemic.

What 
will happen when they return to the scene.?   Does make you think about that 
for a little bit doesn't…. Yes the real estate market is changing. 
In the past several years we were very   very strong sellers market, so maybe the tide 
will turn and will shift to a buyer's market. I don't have a crystal ball so let's 
all pause for a minute here in Kona   and see what the future holds with our real 
estate market there's no need to freak out   and put the brakes on. If you're a buyer buy. If you're a seller   sell. In my 26 years of selling real estate 
people buy and sell in all kinds of market   and this will probably continue today whether 
you think we're in a housing bubble or not If you like this video and want to see 
more about the Kailua Kona area please hit   the subscribe button below and if you have any 
questions or comments please post them as well Mahalo till next time Aloha!.