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Hawaii ranked 4th in growth of personal income for the first quarter, according to a report released Thursday by the U.S. Bureau of Economic Analysis.Hawaii’s personal income grew 1.6 percent from the fourth quarter of 2007 to $52 billion.

As of January 1, 2010, building permitswill not be issued for homes that do not have solar water heaters.   Is this a good move?

Is the real estate market coming to life on the mainland?  Maybe, maybe not.  One things for sure, there are a few signs of life in hard hit areas of the country.

I said last month, that one of the first signs of a recovery in real estate is when the number of sales increase.  We saw that last month, but it was too early to say there could be light at the end of the tunnel.  Now this month, we see California Sales Up 18%, National Home Sales Increased 2% in May, and Pending Home Sales Up 6.3%.

Now, I am not saying all is rosy in the housing market, (so don’t bash me yet) but for prices to level out on the mainland, the demand side must begin to increase and not decrease.  Is this what is happening?  It may take some time to get there.

Bargain hunters have entered the market en masse, especially in areas that have experienced double-digit price declines, but it’s unclear if they are investors or owner-occupants.

Home buyers are starting to get off the fence and into the market, drawn by drops in home prices in many areas and armed with greater access to affordable mortgages.

What you’re seeing in some of the hardest hit markets, like California and Florida, is that Americans still love bargains.

In the American Express commercial, Jerry Seinfeld put the nossel into his car’s gas tank and began to pull the handle to fill his tank up as he screamed out, “Release the Hounds!” That statement reminds me of the anticipation of the wave of Chinese toursit expected to come visit the U.S. in the upcoming years.  In a sign of things to come, China has opened up vacation package tours to the U.S.  Is this the beginning stage of the boom to be?  The beginning to “Release the Hounds?”  The first arrivals are already here as isles welcome the influx of tourist.

Chinese tour groups left for Hawai’i and other places in the U.S. yesterday under a new agreement that the American travel industry hopes will bring in billions of dollars.

An initial group of more than 200 tourists was flying in from the cities of Beijing, Shanghai and Guangzhou for a 12-day visit that will take them to destinations such as Hawai’i, New York, Washington and Los Angeles. The trips cost about $4,000 each.

Chinese with visas have long been permitted to travel to the U.S. but the agreement signed last December considerably eased the way by conferring China’s “approved destination status” on this country.

Chinese travelers on average spend upward of $6,000 per visit to the U.S. — more than residents of any other nation — according to U.S. Commerce Department calculations.

Some of those who have had already arrived and have had a chance to do some sightseeing say they believe Hawai’i will become a major tourist destination for Chinese travelers.

I know it is just a start but changes seem to be occurring monthly with regards to an ease in visiting restrictions.  Ultimately the economic upside of this will prevail.

The first group to arrivewill be this week and will be greeted by Gov. Linda Lingle.  FHB changes to accept China Union Pay bankcard.

Honolulu is the #1 city to live in in the U.S. and the 12th best in the world.  I must admit, I agree with this. (slight-bias)  This would explain why I became a  ”Permanent Tourist”. 

I originally came to Hawaii as a favor to a friend for 3 months after graduating college with a round-trip ticket in hand and the full intention of leaving after 3 months.  A few thousand waves later and I am still here.

I just celebrated my 9th year here and never used that return trip ticket.  It is framed on my wall now. 

Want a new stove that cooks faster, is safer and more efficient than anything before?

Magnetic induction may just be the next “thing” to arrive.  I am sure most of us would have to give it some time before it is affordable enough to make sense.

An induction cooktop looks a lot like an electric smoothtop, but what goes on beneath the surface is very different…Put a pot made of a magnetic material - like iron or steel - onto that field and the energy gets transferred to it in the form of heat. Nothing else gets hot, only the pot, and you can adjust the field and the heat with the knob, just as with your old stove.

Magnetic Induction offers several advantages over gas and electric.

The rankings are out for the World’s Best Places to Live. 

Mercer Consulting’s annual roundup of the global cities with the best quality of life is here, and Zurich once again comes out on top. The best place in the U.S.? Honolulu at No. 28.

This along with Best Life Magazine’s vote of Honolulu as the #1 City To Raise A Family and The Housing Predictors voted Honolulu as the Hottest Real Estate Market in 2008.

Can you say, ”Tri-fect-a!”  Not bad for this year.

Question: I recently went to several new development projects to look at the home options they have and didn’t want to bother my Realtor.  The next time I was out with my Realtor looking at homes I let her know this.  She didn’t seem pleased for some reason.  My wife and I were trying to decide to purchase in the new development or outside of it.  After that day we never heard from our Realtor again.  Did we do something wrong?

Answer: No, you didn’t do anything wrong, but it sounds like your agent didn’t take the time to fully explain the real estate process, and unrightfully bailed on you.

When it comes to new development projects (new condo high-rises, new home subdivisions, Resort developments) on Oahu, the developers will pay a commission to your agent IF you are accompanied by your Agent on your first visit to the project and you register at that time with your agent. It doesn’t cost you any more money to do so, and there is a benefit: Representation, or someone to look after your best interest, and the hundreds of pages of documents that go along with a development.  Because the amount of paperwork to comb over from development projects can be a daunting task, most buyers don’t look through the papers thoroughly.  The free representation is, by far, worth it.

These developments attempt to get you to come to their developments where they can register you in their database.  Once you have visited the development on your own and are in their database the seller/developer will no longer pay an independent agent, like myself, to represent your interests.  Just remember when you work with an in-house resort/development agent, they do not have your best interest at hand, and they have a fiduciary relationship to represent the seller exclusively.

Please contact your Realtor before walking into or calling a sales office at any development project if you want independent representation without additional cost to you.  Also, read the developers fine print addition:

WARNING: If your initial contact with a developer’s sales team is on your own, in-person, you will, without your consent, lose your right to independent buyer representation paid for by the Seller/Developer at no additional cost to you.

Since Agents don’t get paid a dime for showing homes — only for selling them, I can only assume that your Realtor lost motivation to work hard in finding you a home, since he/she felt they may be doing pro-bono work if you decided to buy in the development project and was too afraid to mention that he could represent you on the new development project at an additional cost to you (You pay your Realtor directly in addition to the purchase price of your new home for representation).  Anyhow, this could have been avoided with proper communication.

Question:“My Realtor recommended that I start looking at properties and then after we have seen some various options, we would speak with a lender about financing. Is this the industry standard? And do you recommend the same-thing? In other words, at what point in the buying process should I speak with a lender about financing?”

Answer: These are great questions, and the most important questions I have been asked yet. 

Is this the industry standard? First off, there is no industry standard for when you should speak to a lender, but there is a common sense standard:)  which I will get into in a minute.

Do you recommend the same-thing?No I don’t! Now the common sense factor comes in to play.  How can you start looking at buying something if you don’t know how you will pay for it? if you can afford it? and what the best way to pay for it is?

At what point in the buying process should I speak with a lender?  My recommendation, is that you speak (and by speak, I mean have a consultation) with a lender 6 MONTHS ahead of the time you plan to start LOOKING at properties to purchase or plan on making your move.  6 months seems like a long time out, but it is necessary if you want to make sure you get the best possible interest rate and the lowest mortgage payment.  I have yet to have a client who wants to have a higher mortgage payment than they have to.

Getting your finances in order, to me, is the single most important part of the buying process and planning and preparation is the key to getting your finances in line.  If you have credit issues that need to be cleared up, whether they are from your own doing, from a mistake that was made by a company or from someone who stole your identity, it could very easily take that long to clear-up. 

Since your mortgage interest rate has a direct correlation to your credit scores (FICO scores), then the better your credit scores are the better your interest rate will be.  By speaking with the right lender 6 months ahead and allowing them to look at your credit, they can make sure you are in the best position possible and help you to work on your credit if necessary.

There is another reason to speak with a lender 6 months out. It is called mortgage planning.  I recommend making sure you have mapped out the proper loan program for your needs.  Speaking with a lender about your goals are important to make sure you choose the best loan for your needs.  How long are you going to hold the property? Do you need down payment assistance that you need to apply for?  What type of property are you going to purchase? What are your future plans? etc. 

The right lender will be able to save you thousands of dollars by making sure you choose the right program for your needs.  By looking at your goals 6 months ahead of time, the lender can make sure you will be able to qualify for that program.  Are there unique requirements or any changes that you need to make now to get you to qualify for that specific loan program when the time comes for you to purchase?

Want to make sure you save the most amount of money and don’t spend more each month than you absolutely have to?  This is the number one way, ahead of buying a home for an undervalued price.

I can put you in contact with great lenders that help with just these very situations. Call me and I can give you their phone #.

Here we go with another month of market stats to look at.  The Oahu market is very interesting at the present time.  With home prices falling around the country, it is amazing to see how well Oahu has held up.  We continue to see the same trend that has gone on since the begining of the year with the number of sales continuing to decrease, while the median sales prices hold firm.  I will also highlight a few items separate of the stats in this article that may be of interest to you.

….May housing statistics…… showed the continuing downward trend for sales on O`ahu. Dana Chandler, President the Board, said, “We continue to have a decline in buying demand for residential properties in the O`ahu housing market, but the median prices have been holding up remarkably well. The inventory of homes and condominiums available for sales has been rising and while this could lead to weaker prices, it hasn’t occurred yet. This continues to be a stable environment for both buyers and sellers.”

Here are several articles that relate to May’s stats:
Harvey Shapiro’s Summary
Housing Prices Stable But Sales Plummet (Honolulu Advertiser)
Home Prices Steady As Sales Drop (Honolulu Star Bulletin)

** The newspapers describe this month compared to the same month last year.  I will cover the year to date numbers from this year to last (Jan. 1, 2008 - May 31, 2008 vs Jan. 1 2007 - May 31, 2007) Looking at year to date numbers gives a much more accurate account of the market. 

View the Stats at May’s Market Stats.   You can also view all previous months stats and quarterly stats at THE Resource Center.

On page 3 of 20 we see the year to date sales info.  For SFH’s the number of property sales is down 24.5%, while the median sales price, year to date is $630,000, down .8% from the same time last year.  For condos, the number of sales is down 25.8%, while the median condo price is up 2.5% to $330,000.

On page 4 of 20 the graph shows the trend in the number of sales as we continue our trending decline in the number of sales.

The graph on page 6 of 20 shows the leveling or flattening out trend of sales prices.

On page 6 of 20 we see the median number of Days-On-Market (DOM) for both SFH’s and condos.  Both increased but are still at good levels, as SFH’s stay on the market for an average of 52 days before going into escrow and condos stay on the market an average of 41 days before going into escrow.

On page 14 of 20 we see that inventory increased for both SFH’s and condos.

On page 18 of 20 we see the months of inventory remaining for both SFH’s and condos. This means, if we didn’t bring any more properties on the market, how many months would it take to sell the existing properties for sale.  A balanced market is 6-7 months worth of inventory.  For SFH’s we have 8 months of inventory and for condos there is 7.1 months of inventory remaining.

On page 19 of 20 we see the months of invetory remaining breakdown based on area of the island, type of property, and price range.  The $1.0 million plus property price range, there is 17.5 months of inventory.  The next highest is 7.1 months of inventory for the $700-999,000 price range.  The North Shore and Windward Oahu top the charts for SFH’s months of inventory remaining.

In other news:

As seen on the Today Show, Honolulu was voted the Top City In The US To Raise A Family.

Have you ever wondered if investing in Oahu real estate is actually a better investment than other options?  I compared the historical info of buying a home on Oahu as an investment and compared it to two other investment options.  Check out the results.

Have you wondered when the housing troubles on the mainland will end?  The end may be in sight.

Talk about a creative way of selling your home.  Have you ever thought about raffling your home off?  Well….it is being done now!