Hawaii homes in top third of priciest markets

Hawaii's home prices did not fall within the 10 most expensive nor least expensive markets in the U.S., according to Coldwell Banker's annual home price comparison index.

The average sales price of a home on Honolulu in 2008 was recorded at $780,000, which falls in the upper-third tier of the market, right below Washington, D.C., at $785,000 and Pasadena, Calif., at $794,500.

La Jolla, Calif., recorded the highest average sales price, at $1.8 million, which is $1.7 million higher than Sioux City, Iowa, which recorded the lowest average sales price of $133,459.

Not surprisingly, eight out of 10 of the nation's most expensive housing markets were in California, while eight Midwestern cities were among the 10 most affordable home markets.

Kihei on Maui, however, came close, recording an average sales price of $934,950, but short of the $1 million mark for all of the top 10 most expensive markets in the nation. In total, 13 U.S. markets exceeded the $1 million average price for a home.

Kihei was listed as Hawaii's most expensive market, while Honolulu was listed as the most affordable within the state.

The Coldwell Banker home price comparison index offers an apples-to-apples comparison of 2,200-square-foot, four-bedroom, two-and-a-half bath homes in 315 U.S. markets, including Puerto Rico.

The cumulative average sales price recorded by the index was at $403,738, 4.4 percent lower than a year ago.

Jim Gillespie, president and chief executive of Coldwell Banker Real Estate in Parsippany, N.J., said he believed this was the smartest time in his 33 years in real estate to buy a home.

"Combined with the amount of homes on the market and historically low interest rates, the correction in prices has brought affordability levels down," Gillespie said.

Half of the market surveyed showed an average price for a home at less than $300,000, he added, showcasing the affordability of homeownership across the nation.

Hawaii, however, does not fall anywhere close to that definition of affordability. The median home price of a home on Oahu was recorded at $636,000 in the second quarter of this year, according to the Honolulu Board of Realtors.

The market here continues to cool down, with home sales dropping 33 percent last month.