Honolulu's single-family home and condominium sales were almost cut in half last month as unit counts plummeted to their lowest levels in more than a decade.

Single-family home sales plunged a dramatic 46.5 percent to 122 sales from the year-ago 228 transactions while condominium sales fell to 159 transactions, a 50.9 percent fall from the previous year's 324 sales, according to resale figures released yesterday by the Honolulu Board of Realtors.

Honolulu's January residential real estate results reflect the incredibly weak consumer confidence that was plaguing the market in November and December when buyers were inundated with reports of rising unemployment, business closures, stock market declines and uncertainty about the political transition, said John Riggins, owner of Kapolei-based John Riggins Real Estate.

“;A lot of people are like a deer in headlights - they are paralyzed and not sure what to do,”; he said. “;We have to get over the paralysis before things can get better.”;

Just how bad is the market right now? It's “;very, very weak,”; said Harvey Shapiro, research economist for the Honolulu Board of Realtors.

The last time single-family home sales fell below 122 transactions was in February 1998 when the Asian financial crisis caused sales to drop to 115, Shapiro said. Similarly, the last time condominium sales fell below 159 was in August 1997 when the number dipped to 144, he said.

Still, the current market slide is different than in the 1990s when a preponderance of Asian buyers dropped out of the market and a lack of sales combined with inventory build-up caused severe price contractions, said Chason Ishii, president of Coldwell Banker Pacific Properties.

“;This time around we haven't had that kind of inventory build-up so the adjustment on pricing will not be as dramatic,”; Ishii said.

Last month, market pressure caused the median price paid for a single-family home to drop 10.1 percent to $539,500 from the year ago $600,000, Shapiro said. The median price paid for a condominium dipped 5.8 percent to $305,000 from the year ago $324,000, he said.

  “;It appears that the housing market in Hawaii is now following the same pattern as on the mainland, namely very slow sales and diminishing prices,”; Shapiro said.

In this market, slowing sales appear to be linked to poor consumer sentiment rather than a glut of inventory, he said. In January, sellers actually put 70 fewer single-family homes and 140 fewer condominiums on the market than they did in December, Shapiro said.

On the brighter side, the current market has created new opportunities for some buyers who were unable or unmotivated to get into the previous market, said Scott Higashi, executive vice president of sales for Prudential Locations LLC.

“;There is a bit of a perfect storm with interest rates as low as they have been going combined with price drops in several areas in Oahu,”; Higashi said. “;Some buyers can get a little bigger house in a different neighborhood for roughly the same mortgage.”;

The incentives are there for buyers who want to trade up, make 1031 exchanges or get into the market for the first time, Higashi said. But, economic uncertainty has continued to cause buyer hesitation, he said.

“;Folks want to make sure that their jobs are OK before they make a substantial financial commitment like buying a home,”; Higashi said. “;They are shaken by what they've seen and some of them want to hold onto their cash.”;

As a result, Honolulu's real estate market mainly saw activity from buyers who were looking to trade up or down due to lifestyle changes in January, Ishii said. There was not much activity from investors or international buyers, he said.

While the market is unlikely to show marked improvement until 2010, an increase in the number of pending sales in January could mean that the market will expand somewhat in the coming months, Ishii said.

“;We've seen a lot of activity since the major interest rate drops came into play,”; he said.

Going forward, sales activity is likely to improve from January's low; however, pricing may post further decline, Ishii said.

  “;Sellers have begun to understand that the market has shifted and are willing to take or entertain offers that are considerably lower than their list price.