The Lowdown on Honolulu's Luxury Market
I was intrigued by some of the data detailed in the 2010 Luxury Home Real Estate Market Report released by Prudential Locations early last month, and thought I'd pass along a few of the more intriguing highlights:
- I think, locally, there’s a perception that most of Oahu’s luxury homebuyers are Asian or Mainland investors. And, certainly, those two parties are significant players in the luxury-market segment—since 2008, California and other Mainland buyers have made up 22 percent of the market; buyers from Asia total another 10 percent. However, the largest group of luxury buyers—64 percent—came from Hawaii. Thus far, this year’s data is trending the same, with a slightly higher percentage of Asian buyers and a minor decrease in Mainland buyers.
- Luxury homes are moving fast. The current days-on-market stats, which detail the number of days a typical house takes to sell and enter into escrow, indicate a big drop in the amount of time in which luxury homes are sitting on the market. According to the report, current sold-time levels have reached their lowest point in 10 years.
- During the past year, the majority of luxury home sales—74 percent—have been in the $1.2 to $2 million range. This statistical nugget could partially be the result of the “trading-up” trend: buyers taking advantage of ridiculously low interest rates to upgrade to nicer digs.
- Not only are luxury homes selling faster; fewer price reductions are being made. Thus far this year, about 25 percent of high-end homes have had a list-price reduction before selling, a marked decrease from mid-2009, when close to 50 percent of luxury-home listings were reduced in price before finally selling.
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