O‘ahu in 1978: Housing Prices on the Rise in Hawai‘i
In the late 1970s, Hawai‘i’s housing prices hit an all-time high. Fast forward four decades, and we’re still singing the same tune.
When it comes to the housing market in the Islands, the 1970s were not much different from 2019. Real estate wasn’t cheap. A population surge sent housing prices skyrocketing, according to HONOLULU’s June 1978 issue.
HONOLULU dove into the numbers (and residents’ nightmarish housing stories) in its guide to renting, buying and selling in Hawai‘i.
A 1978 advertisement lauding Mililani Town’s “unusual and creatively-designed” patio homes.
It’s a seller’s market. Demand is gobbling up the inventory—particularly in single-family homes and pushing prices up.
According to the Multiple Listing Service figures for sales during the last half of 1977, the average cost of a single-family home on O‘ahu reached an all-time high of $100,000. This zoomed up from $85,612 a year ago.
The situation is even wilder on Maui, where single-family homes are averaging $104,600 and condos $109,353. At Wailea, people are standing in line in hopes of having their names drawn from a hat for the privilege of buying a one-bedroom condo for $150,000 (double what it was four years ago when it went on the market).
[For comparison], in Atlanta, a ranch-style home with three bedrooms, two baths, a family room with a fireplace, on a half-acre, fee-simple wooded lot costs $50,000. But in Hawai‘i, a two-bedroom, one-bath ‘patio home’ (single-story townhouse) in Mililani on a fee-simple 1,847-square-foot homesite, costs the same.
Studies show that Hawaii will need around 85,000 new housing units by 1985 if current population growth patterns continue.
With the prices of everything going up, will people continue to pay them for the privilege of living in the islands?
“Probably,” says Vi Dolman (president of the Honolulu Board of Realtors), “my feeling is: It’s better to live in a grass shack in Hawaii than in a castle in Kansas.”
In the 1970s, a woman could get a nice pair of leather shoes for about $15, a gallon of milk was about $2 and most people in Honolulu paid about 80 cents for a dozen eggs, all of which probably doesn’t sound too bad compared to today’s prices. And in 1981, by the way, mortgage rates nationally were approaching 18 percent.
Today, our interest rates are much lower but housing in paradise still isn’t considered affordable by most people’s standards. We pay a monthly median of about $1,500 for rent and $2,300 for mortgage, according to U.S. Census data. The Honolulu Board of Realtors reported that median sales prices for single-family homes went from $755,000 in 2017 to $790,000 last year.
A search on Trulia for homes in Honolulu shows sales prices easily topping $1 million. Could you afford the $6.8 million five-bedroom, eight-bathroom home in Kāhala or even the $2 million four-bedroom, one-bathroom “fixer-upper” in Waikīkī?
Will those drop? One of the 1978 headlines might lend a clue—“The Great Delusion: Prices Will Come Down.”