Honolulu homes' list prices drop


POSTED: Thursday, November 19, 2009

Nearly one-third of Honolulu real estate listing prices have dropped in the last six months, with the average decline in the 10 percent range, according to online real estate marketplace Trulia.com

Twenty-seven percent of Honolulu listings dropped their prices between June and November, earning the city a ranking of 31 out of 50 cities that experienced significant reductions in their listing price.

The percentage of Honolulu listings experiencing a price drop was a little higher than the national average of 25.6 percent reported by Trulia; however, the city was better positioned than 40 percent of the top 50 major metro areas across the nation that have experienced price reductions above 30 percent.

In terms of actual price drops, Trulia said Honolulu was on par with the nation's average 10 percent price reduction.

The Northeast continued to see the highest price reductions, with 29 percent of the listings experiencing at least one price cut between June and November. Price reductions in the Midwest impacted 28 percent of the listings, while 25 percent of listings in the West and 24 percent 1/2 of listings in the South experienced price drops.

Despite the pickup in real estate sales in Honolulu and nationwide, Trulia expects that the price drops could continue.

Low mortgage rates and expansion of the tax credit to trade-up buyers could inspire more sellers to list their homes, resulting in significant inventory increases in the next four to six months, said Pete Flint, Trulia co-founder and chief executive officer.

“;Inventory levels this quarter are poised to be atypical of a normal real estate market, which could create tremendous pressure on sellers to price their homes competitively and move their property before the tax credit expires on April 30th,”; Flint said.

It's imperative in this market that sellers price their homes competitively, said John Riggins, owner of John Riggins Real Estate.

“;There weren't any Oahu neighborhoods that saw price increases last year and only a very few have begun to show increases in the last few months,”; Riggins said. “;Most sellers are still going to have to list their homes below the last comparable sales in their neighborhood.”;

One of the short-sale properties that Riggins is marketing has already experienced three price adjustments, he said. The property, which went on the market at $529,000, was lowered to $519,000, $517,500 and finally to $510,000, he said.

“;To sell in this market, a house has to show like a model and be priced right,”; Riggins said. “;If not, the listing is going to get shopworn.”;